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Difference between revisions of "Four Key Duties of a Fiduciary"

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Four Key Duties of a Fiduciary (view source)

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Note that even if you are not paid for your time, you are entitled to be paid back for any reasonable out-of-pocket expenses. For example, let’s say you use your own funds to buy a journal or chequebook to be used for Martina’s benefit.
Note that even if you are not paid for your time, you are entitled to be paid back for any reasonable out-of-pocket expenses. For example, let’s say you use your own funds to buy a journal or chequebook to be used for Martina’s benefit.
==Duty 2. Manage Martina’s money and property carefully==
As Martina’s attorney, you might pay bills, oversee bank accounts, and pay for things she needs. You might also make investments, pay taxes, collect rent or unpaid debts, get insurance if needed, and do other things written in the power of attorney.
You have a duty to manage Martina’s money and property very carefully. Under [http://canlii.ca/t/849l the law], you need to “exercise the care, diligence and skill of a reasonably prudent person”. As a fiduciary, you must be even more careful with Martina’s money than you might be with your own!
Follow these guidelines to help you make careful decisions.
===List Martina’s money, property and debts===
To make careful decisions, you need to know what Martina owns and owes. Under [http://canlii.ca/t/8p5w the law], you must make a reasonable effort to determine Martina's property (what she owns) and liabilities (what she owes) as of the date when you start to act on her behalf. You also must maintain a list of that property and those liabilities.  
Your list might include:
* chequing and savings accounts
* cash
* investments such as any Guaranteed Investment Certificates (GICs), stocks, bonds, and Registered Retirement Savings Plans (RRSPs)
* real estate
* cars and other vehicles
* insurance policies
* trusts for which Martina is a beneficiary
* jewelry, furniture, and any other items of value 
* unpaid credit card bills and other outstanding loans
===Protect Martina’s property===
Keep Martina’s money and property safe.
You may need to put valuable items in safety deposit boxes or change locks on property. Make sure her home and any other property is heated (in cold weather) and insured.
Make sure bank accounts earn interest if possible and have low or no fees. Review bank and other financial statements promptly.
Find out if anyone owes Martina money, and try to collect it. This may include going to court.
{{PLSTipsbox
| text = Can Martina get any benefits? Find out if Martina is eligible for any financial or health care benefits from an employer or government agency. These benefits might include pensions, disability, social assistance, veterans benefits and housing assistance. Use the federal government’s [http://www.canadabenefits.gc.ca/ Benefits Finder]. Contact [http://seniorsfirstbc.ca Seniors First BC] for assistance. Help Martina apply for any benefits she is eligible for.  
}}
===Make sure bills and debts are paid===
Pay Martina’s bills and taxes on time.
Cancel any insurance policies that Martina does not need.
===Take steps to have the power of attorney accepted===
As soon as you need to act as Martina’s attorney, contact any banks, businesses or people that she deals with and give them copies of the power of attorney. Never give away the original document. You can get certified copies of the original. (A lawyer or notary public can certify a copy as a true copy of the original document.)
Sometimes banks or other businesses won’t do what you, acting as Martina’s attorney, want them to do. A bank may refuse to accept the power of attorney, or may want Martina to sign its own form of power of attorney. This is particularly a problem if Martina has lost the ability to act for herself. You should get advice, as the bank’s form may undo careful planning done for Martina’s benefit.
If someone will not accept your authority to act on behalf of Martina, talk to a supervisor. If they still won’t accept it, talk with a lawyer. Under the law, in Martina’s enduring power of attorney, she can authorize you to do anything she may lawfully do by an agent in relation to her financial and legal affairs.
{{PLSTipsbox
| text = Don’t expect others to know what an attorney is or does. They may not understand that you have been named as an attorney. They may think that you have more authority or less authority than you really have. You may need to educate them. You could show them this guide. You can also refer to the factsheet “[http://www.nidus.ca/PDFs/Nidus_Info_Role_Attorney.pdf Roles and Responsibilities of an Attorney]“ from Nidus.
}}
==Duty 3. Act within the authority you are given and within the law==
An attorney must act within the authority '''given in the power of attorney''' and '''under the law'''.
In managing Martina’s affairs, you must take into account any directions she made in the power of attorney document. Don’t do something different from her directions, even if you have the best intentions.
You must also follow these six guidelines set out under [http://canlii.ca/t/849l the law].
===1. Give priority to Martina’s health and personal care needs===
To the extent reasonable, when managing Martina’s financial affairs, give priority to meeting her personal care and health care needs. Make sure she is safe and comfortable, and her needs are met. Put her well-being above saving money for others who may inherit her money and property.
 
===2. Invest carefully===
Under [http://canlii.ca/t/84f1 the law] in BC, when investing Martina’s property, you must “exercise the care, skill, diligence and judgment that a prudent investor would exercise”. This is a high standard. The exception to this rule is if the enduring power of attorney document says something different.
If you make investment decisions for Martina, talk to a financial professional. The BC Securities Commission‘s [https://www.investright.org investRIGHT website] provides tips on investing and knowing your financial advisor. Discuss choices and goals for investing based on Martina’s needs and values.
===3. Foster Martina’s independence and involvement in decisions===
As Martina’s attorney, you have a legal duty, to the extent reasonable, to foster her independence and encourage her involvement in any decision-making that affects her.
You should practice “supported decision-making” with Martina if at all possible. Supported decision-making is when people use friends, family members and professionals to help them understand the situations and choices they face, so they can make their own decisions. We all do this to some extent. Martina just may need more of this support.
Being as independent as possible and making your own decisions is an important aspect of mental health. Try to help Martina recognize her concerns, goals and values. Explore the range of choices with her, and have her make the decision herself if at all possible.
A “[http://seniorsfirstbc.ca/for-professionals/supported-decision-making/gradual-counselling/ gradual counselling]” approach might help Martina. In this approach, you clarify and reflect her thoughts and feelings. You help her to recognize the pros and cons of various options, and how they relate to her goals and values.
===4. Avoid changing Martina’s plans for her property when she dies===
If any of Martina’s property is part of a specific gift in her will, you should not dispose of this property unless necessary to meet your duties as her attorney.  
{{PLSTipsbox
| text = If you are considering a decision that would change Martina’s plans for her property when she dies, you should get legal advice.
}}
===5. Allow Martina to access her property===
To the extent reasonable, keep Martina’s personal effects at her disposal.
===6. Keep Martina’s money and property separate===
Never mix Martina’s money or property with your own or someone else’s. There are two exceptions to this rule: if the property is owned jointly, or the enduring power of attorney document says you can.
Mixing money or property makes it unclear who owns what. Confused records can get you in trouble with Martina’s family and also with government agencies such as the [http://www.trustee.bc.ca/ Public Guardian and Trustee].
Never deposit Martina’s money or property into your own or someone else’s bank account or investment account. Avoid joint accounts.
{{PLSTipsbox
| text = If Martina already has money or property in a joint account with you or someone else, get legal advice before making any change.
}}
Pay Martina’s expenses from her funds, not yours. Spending your money and then paying yourself back makes it hard to keep good records. If you really need to use your own money, keep receipts for the expense and maintain a good record of why, what and when you paid yourself.
Keep title to Martina’s property in her own name. This is so other people can see right away that the property is Martina’s and not yours.
{{PLSTipsbox
| text = Know how to sign as attorney. Sign all cheques and other documents relating to Martina’s money or property to show that you are Martina’s attorney. Never just sign “Martina Roe”. For example, you might sign:
“Juan Doe, as attorney under power of attorney for Martina Roe.”
}}
==Duty 4. Keep good records==
As an attorney under a power of attorney, you must keep good records.
Under [http://canlii.ca/t/8p5w the law], an attorney under an enduring power of attorney has a duty to keep these records:
* A current list of Martina’s property and liabilities. This includes an estimate of their value if it is reasonable to do so.
* Accounts and other records showing how you have exercised your authority under the enduring power of attorney.
* All invoices, bank statements and other records to keep track of money you have spent or received on behalf of Martina.
===Practice good record-keeping habits===
Keep a detailed list of everything that you receive or spend for Martina. Records should include amount of cheques written or deposited, dates, reasons, names of people or companies involved, and other important information.
Keep receipts and notes, even for small expenses. For example, write “$50, groceries, ABC Grocery Store, December 2, 2017” in your records soon after you spend the money. Get into the habit of always asking the store for a receipt.
Avoid paying in cash. Try not to pay Martina’s expenses with cash. Also, try not to use her ATM card to withdraw cash or write cheques to “Cash”. If you need to use cash, be sure to keep receipts or notes.
===Keep records of any payments to yourself===
[http://canlii.ca/t/849l The law] says that you can be paid for acting as an attorney under an enduring power of attorney only if the document says you can and sets out the amount or rate. If you will be paid, be sure you charge a reasonable fee based on the amount or rate set out in the power of attorney. It is up to you to keep detailed records as you go along of what work you did, how much time it took, when you did it, and why you did it.  
Even if you are not paid for acting as an attorney, you are entitled to be paid back for reasonable “out-of-pocket” expenses while acting as the attorney. Be sure to keep records of these expenses.  
===If others ask to see your records===
If Martina asks to see your records, you must produce them for her to inspect and copy.
The [http://www.trustee.bc.ca Public Guardian and Trustee]’s office can also review your records to check up on you. If that happens, unless the power of attorney says you can’t share your records or Martina objects, you may want to let another family member or friend of Martina’s see the records as a precaution.




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