Power of Attorney (15:IV)
A Power of Attorney (POA) is a legally-binding document that allows a capable adult (called the ‘adult’) to grant the authority to other capable adult(s) (called the ‘attorney(s)’) to make financial and legal decisions on their behalf. A mentally capable adult does not give away their authority to an attorney. Rather, the effect of a POA is to share the authority with the attorney. POAs can vary in scope, depending on the:
- Specific needs of the adult
- Types of decisions an attorney is permitted to make
- Time period (i.e. ongoing or set for a limited period)
- How many attorneys are appointed
- Need for unanimous decisions or task-specific roles
The adult can make very individualized and specific provisions in a POA. For example, a POA can be very narrow in scope, allowing the attorney(s) to do one specific act (e.g. cashing a pension cheque, transferring property, or paying insurance). Alternatively, the adult can make a POA that is intentionally broad in scope, allowing the attorney(s) to handle all financial decisions on their behalf.
Anyone aiding another to create a POA should ensure that the adult understands and appreciates the nature and consequences of a POA. Also, note that an adult should not be required to have a POA as a condition of receiving any good or service.
The following sections explain: what type of POAs can be made; who is involved in a POA; how a POA can be made, changed, or revoked; the duties and powers of an attorney; and what can be done if an adult is incapable and does not have a valid POA in place.
A. Types of POA (POA)
There are two types of POAs. It is important to find out what type of POA would best suit the adult’s needs. The first is governed by Part 1 of the PAA, and is sometimes called a “General POA”. The second is governed by Parts 2 and 3 of the PAA, and is sometimes called an “Enduring POA”. The key difference between the two is that a POA under Part 1 ends once the adult becomes incapable, while a POA under Parts 2 and 3 continues even when the adult becomes incapable. Questions to ask include:
- What tasks does the adult want the attorney to be able to perform?
- When does the adult want the attorney to begin to act?
- Does the adult want the POA to be used for a limited time only?
- Does the adult want the POA to be in effect immediately or only when they become incapable?
- How will incapacity be decided?
- Does the adult’s powers terminate if and when the adult becomes incapable?
The two types of POA are as follows:
- General: General POAs are governed by Part 1 of the PAA, and by common law for agency relationships. They are effective immediately, or as specified on the document, and ongoing until the loss of capacity, revocation or death. The test for capacity for making general POAs can be found in the BCLI’s Report on Common Law Test of Capacity. General POAS are rarely used in incapacity planning, as they become no longer in effect when an adult becomes incapable (which is often when a POA is most needed).
- Enduring: Enduring POAs (EPOAs) are governed by Parts 2 and 3 of the PAA. These can be effective immediately, or “springing”. (See below). Enduring POAs continue in the event that the adult loses capacity, and only ends upon revocation or death. These are the most common type of POA, they allow the attorney to act while the adult is capable and continue when/if the adult becomes incapable.
- NOTE: A “springing” EPOA stays dormant until a future date or event (i.e. the loss of capacity) and ends only upon death. The adult can decide in advance how capacity is to be determined, such as by requiring the agreement of a family member and two doctors. A springing EPOA is not active until the adult loses capacity.
- See Goodrich v British Columbia (Registrar of Land Titles), 2004 BCCA 100. (The BCCA decided that even though the PAA does not explicitly allow for a springing power of attorney, it is nevertheless possible to make one.)
Both general POAs and EPOAs can be limited in relation to assets, duration, or specific types of transactions. For example, an adult could draft a POA for the attorney to manage their bank accounts and pay their bills while they are on vacation, but not give authority to the attorney over their real estate and investments. A bank’s POA will be limited to transactions at that institutions for the accounts identified.
In most cases, the POA will be effective immediately, once signed and witnessed by the adult and attorney(s), and will continue on an ongoing basis.
NOTE: Unless otherwise specified, all usage of the term “POA” in the subsequent sections of this chapter refers to an Enduring Power of Attorney as governed by Part 2 of the PAA.
B. Who is Involved in a Power of Attorney?
Only a capable adult may make a POA. A POA requires at least one person to act as an attorney. The adult may name multiple or alternate attorneys.
In some situations, the Public Guardian and Trustee (PGT) can be appointed as the attorney, particularly where an adult does not have family or friends who can act on their behalf (PAA s 18). The PGT may also become involved where there is financial abuse, neglect or self-neglect, particularly if there are concerns that an attorney is misusing a POA, or failing to fulfill their legal duties (PAA s35).
Below is a brief description of how an adult, attorney(s) and the PGT are involved in a POA. For more detailed information about the mental capacity of an adult, refer to section I. B. 1: Mental Capacity – Power of Attorney, above. For more information about reporting abuse or neglect to the Public Guardian and Trustee, refer to section VIII: Abuse and Neglect in this chapter.
1. The Adult
The “adult” is any adult who makes a POA to appoint an attorney to make financial decisions on their behalf. The Adult must be (PAA s10 and 12):
- An individual who is 19 years of age or older
- Mentally capable of making a POA
- Acting voluntarily, or on their own
The adult must have mental capacity at the time that the POA is signed, understanding the nature and implications of a POA. An adult who has mental capacity has the legal right to make decisions, including the legal right to choose whether to:
- Determine the type, scope or purpose of the POA
- Define the roles and authority of the appointed attorney(s)
- Provide instructions to the attorney(s)
- Express wishes, values and beliefs
- Change or revoke a POA
An attorney is an adult who is capable and willing to carry out the financial tasks and/or make financial decisions on behalf of the adult. An attorney must be: (PAA s 18 and s 19)
- An adult (i. e. at least 19 years of age), the PGT or certain financial institutions
- Mentally capable to carry out the financial tasks
- Able to understand and fulfill their legal duties
- Able and willing to act in accordance with the instructions, wishes, values and beliefs of the adult
- Acting voluntarily/on their own.
Section 18 of the PAA states who may act as an attorney. One or more of the following persons can be named:
- An individual, other than:
- An individual who provides personal care or health care services to the adult for compensation or,
- An employee of a facility where the adult resides and where the adult receives personal care or health services.
- Exception: if the individual is a child, parent or spouse of the adult, in which case they may be named as attorney
- The Public Guardian and Trustee
- A financial institution authorized to carry on trust business under the Financial Institutions Act, RSBC 1996, c 141 [FIA].
The “attorney” in a POA does not need to be a lawyer. However, the adult may wish to appoint their lawyer to act as an attorney.
More than one person can act as an attorney. An adult who names more than one attorney may assign each a different area of authority, or all or part of the same area of authority (PAA s 18(4)). The adult might prefer to define distinct roles for each attorney (i.e. appoint one as the attorney for certain transactions, such as personal banking and a second individual as their attorney over different matters, such as property). The POA should be clear about the roles and responsibilities of each attorney and whether or not unanimous consent is necessary in each type of transaction.
According to s 18(5) of the PAA, where an adult appoints multiple attorneys for all or part of the same area of authority, the attorneys must act unanimously in exercising their authority. The exception to this rule is where the adult specifically does the following in the POA:
- Describes circumstances where the attorneys do not have to act unanimously
- Sets out how a conflict between attorneys is to be resolved
- Authorizes an attorney to act only as an alternate and sets out:
- (i) The circumstances in which the alternate is authorized to act in place of the attorney, for example, if the attorney is unwilling to act, dies or is for any other reason unable to act, and
- (ii) The limits or conditions if any, on the exercise of authority by the alternate.
Where a POA appoints two or more attorneys to act for an adult, all the attorneys will need to be in agreement regarding decisions made for the adult, unless otherwise specified in the POA.
Appointing more than one person has potential advantages and disadvantages. The practice can reduce the potential for an attorney to misuse their power by providing built in scrutiny by a second attorney. However, having multiple attorneys may make the decision-making process complicated and inefficient.
NOTE: As of September 1, 2011, a signature by the attorney(s) on the POA is required to signify acceptance of the role and responsibility. If an attorney is not willing to accept this role, then the attorney should not sign the POA.
3. The Public Guardian and Trustee (PGT)
An adult who does not have relatives or friends who are willing and able to serve as an attorney may ask the PGT to consider acting as an attorney in the event of incapacity. According to s 6(c) and s 23 of the PGTA, the PGT may agree to act as attorney for a fee. If an adult needs to appoint the PGT as attorney, contact the Public Guardian and Trustee.
- NOTE:The PGT will only act as a representative for finance – not for health care decisions.
Another circumstance where the PGT may become involved is where an attorney is misusing a POA or otherwise failing to fulfill their legal obligations. Any person may notify the PGT if there is a reason to believe that fraud, undue pressure or some other form of abuse or neglect is being or was used to induce an adult to make, change or revoke financial or legal document. Any person may also notify the PGT where an attorney is:
- Incapable of acting as attorney
- Abusing or neglecting the adult
- Failing to follow the instructions in the POA
- Otherwise failing to comply with legal duties of an attorney
For more information about the role of the PGT where there is financial abuse, neglect or self-neglect, refer to section VIII: Adult Abuse and Neglect in this chapter.
C. Creating a Power of Attorney
The most important aspect of drafting a POA is to ensure that the document accurately reflects the adult’s specific wishes. Questions to ask include:
- What does the adult want to do?
- Does the adult have capacity to make this POA?
- Does the adult understand the nature of this POA?
- Does the adult understand the potential legal impact of this POA?
- Has the adult received suitable independent legal advice?
- What type of authority does the attorney need?
- Does the adult want to limit the attorney’s authority?
- When should the POA be in effect (i.e. ongoing or limited)?
- Has the adult created other POAs?
Any adult can draft a POA. However, it is advisable to consult a lawyer or notary prior to finalizing a POA. Independent legal advice will help ensure the POA only grants an attorney the powers and authority that the adult wants to give.
An adult with capacity is free to choose to sign a POA or not. It is important to be aware of situations where a person may be putting undue pressure (including physical, financial or emotional threats, manipulation or coercion) on the adult. For more information, refer to the discussion of undue influence below in section VIII: Adult Abuse and Neglect in this chapter. Also refer to the BCLI guide on Undue Influence, which is helpful for understanding the dynamics surrounding undue influence in relation to other legal documents like POAs. The Guide can be found at http://www.lawsociety.bc.ca/docs/practice/resources/guide-wills.pdf.
Formalities are the specific requirements for a POA to be considered valid (i.e. whether the POA has to be signed or witnessed). According to s 16 and s 17 of the PAA, an enduring POA must be:
- In writing
- Signed and dated by the adult in the presence of two witnesses (only one witness is required if that witness is a lawyer who is a member of the Law Society of British Columbia or a notary who is a member in good standing of the Society of Notaries Public of British Columbia)
- Signed and dated by the attorney(s) who agree to act in the presence of two witnesses (unless one witness is a lawyer or a notary)
A new POA will need to be signed by both the adult and the attorney(s). These signatures do not need to be in each other’s presence. In other words, the attorney and adult may sign the document separately. However, these signatures must each be witnessed by two capable adults (unless one witness is a lawyer or notary).
As of September 1, 2011, an attorney must sign an EPOA in the presence of two witnesses before assuming their authority (PAA s 17). If a person who is named as an attorney does not sign the POA, then the person is not required or legally able to act as an attorney. If a person named as attorney does not sign, the authority of any other named attorney is not affected (unless the POA states otherwise).
According to s 16(6) of the PAA, the following persons must not act as a witness to the signing of an EPOA:
- A person named as an attorney
- A spouse, child or parent of a person named as an attorney
- An employee or agent of a person named as an attorney, unless the person named as an attorney is a lawyer, a notary, the PGT or a financial institution authorized to carry on trust business under the Financial Institutions Act
- A person who is not at least 19 years of age
- A person who does not understand the type of communication used by the adult (unless interpretive assistance is used)
The PAA provides a standard form that can be used to create a POA. The most up-to-date version of this form is generally also posted on the government of BC website: www.bclaws.ca.
Although there is no legal requirement to register a POA, an EPOA can be registered through the Personal Planning Registry. More information about this service is available on their website: http://www.nidus.ca.
2. Land Transactions
An adult might authorize the attorney(s) to make a transaction involving land (i.e. transfer of title, closure of sale of property, etc) on behalf of the adult. If the authority of an attorney involves land transactions, then the POA must be executed and witnessed in accordance with the Land Title Act, RSBC 1996, c 250 [LTA].
A POA that grants authority to the attorney to make land transactions will expire after 3 years of its execution. There is an exception to this where an adult signs an EPOA, or the POA expressly exempts itself from these provisions (LTA s 56).
A POA that confers the power to deal with land transactions and registration of land titles must be witnessed and notarized by a lawyer who is a member of the Law Society of British Columbia or a notary who is a member of the Society of Notaries Public of British Columbia. This is because POAs that involve land transactions require more care and consultation to ensure that the adult is aware of the legal impact of conveying this authority to the attorney(s).
3. Banks, Credit Unions and Other Financial Service Providers
Financial institutions and agents (e.g. banks, credit unions, investment advisors, customer service representatives, estate planners, etc.) may ask individuals to complete their institution’s POA. This request normally occurs where an adult wishes to grant the attorney access to bank accounts to pay bills, make transfers, etc. The financial institution may request that the adult and attorney to fill out their institution’s Limited POA. For more information about financial institution’s POA requirements and joint accounts refer to the Canadian Bankers Association website: https://cba.ca/powers-of-attorney-bank-requirements?l=en-us. If the adult signs an institution’s POA, this can sometimes create a conflict between POAs. These important questions should be asked:
- What does the adult want to do?
- What kind of POA should apply?
- Is the financial institution’s form suitable?
- Has the adult received suitable independent legal advice?
The adult should not sign a POA form without seeking legal advice. For more information on preparing documents, consult the Appendix or organisations such as Nidus Personal Planning Resource Centre and Registry. Contact information may be found in section II. D: Resource Organizations of this chapter.
NOTE: It is good practice to notify financial institutions and agents that a new POA has been made and/or that the previous POA has been revoked. This can be done in writing, with a copy of the new POA.
D. Other Jurisdictions
As of September 1, 2011, Enduring POAs (EPOAs) that have been made in some jurisdictions outside of BC, including other Canadian provinces and territories, or some other countries (e.g. United States, United Kingdom, Australia and New Zealand) may be recognized as legally valid in BC. These new provisions are set out in s 38 of the PAA, and subject to the Power of Attorney Regulation, BC Reg 111/2011 [PAR].
Section 4(3) of the PAR currently requires that the EPOA from another jurisdiction be accompanied by a certificate, from a solicitor who is permitted to practice in the jurisdiction where the EPOA was made. The certificate must indicate that the EPOA meets the requirements set out in s 2(a) to (c) of the PAR.
According to s 4(2)(a) to (c) of the PAR, a EPOA from outside BC will be deemed a valid EPOA in BC where it:
- Grants authority to an attorney that comes into effect or continues to have effect while an adult is incapable of making decisions about their own affairs
- Was made by a person who was, at the time of its making, residing elsewhere in Canada or in the United States, the United Kingdom, Australia or New Zealand
- Is in accordance with the laws and continues to have legal effect in the jurisdiction in which it was made
Section 4(4) states that the EPOA is limited by the PAA and the jurisdiction in which the deemed enduring power of attorney was made. Section 4(4) also requires that an attorney and the adult must both be at least 19 years of age before the attorney can exercise any powers or perform any duties.
E. Acting as an Attorney
Below is a description of the various duties and powers held by an attorney. In most POAs, the attorney(s) will immediately be able to act on behalf of the adult. However, in some types of POAs (e.g. a Springing or Limited), the terms of the POA will specify a “triggering event” or date when an attorney has the authority to act on the adult’s behalf. Regardless of when an attorney is permitted to act, the following duties and powers apply.
The primary responsibility of an attorney is to act in accordance with the adult’s instructions, wishes, beliefs and values. The PAA explicitly sets out a number of statutory duties and powers. According to s 19(1) of the PAA, an attorney must:
- Act honestly and in good faith
- Exercise the care, diligence and skill of a reasonably prudent person
- Act within the authority given in the POA
- Keep prescribed records and produce these records for inspection and copying upon request
An attorney must act in the adult’s best interest, taking into account the adult’s current wishes, known beliefs and values and explicit directions in the POA (PAA s 19(2)). Where reasonable, an attorney must give priority to meeting the personal care and health care needs of the adult, foster the independence of the adult, and encourage the adult’s involvement in any decision-making (PAA s 19(3)).
Concerning the adult’s personal property and real property, an attorney must keep the adult’s property separate from their own property (PAA s 19(4)). If the property is jointly owned by the adult and the attorney as joint tenants, or has been substituted for, or derived from, property owned as joint tenants, an attorney must also:
- Only invest the adult’s property in accordance with the Trustee Act, RSBC 1996, c 464 [TA]
- Not dispose of property that is subject to a specific testamentary gift in an adult’s will
- Keep the adult’s personal effects at the disposal of the adult
If an EPOA explicitly says that an attorney will be exempt from these provisions, then the attorney is not legally obligated to fulfill these duties.
An adult may grant general or specific powers to an attorney in a POA. An attorney may also be permitted to exercise statutory powers to act on behalf of the adult. According to s 20 of the PAA, an attorney named has the statutory power to:
- Make a gift or loan, or charitable gift, if the POA permits or certain conditions set out in the PAA are met (see below)
- Receive a gift or loan, if the POA permits
- Retain the services of a qualified person to assist the attorney
- Change or make a beneficiary designation, in limited circumstances (see below)
The scope of an attorney’s powers can be limited or expanded in the express wording of a POA. An attorney is exercising authority improperly if:
- The attorney acts when the authority of the attorney is suspended or has ended
- Or the EPOA is not in effect, is suspended, terminated or invalid
3. Gifts, Loans and Charitable Donations
An attorney may make a gift or loan, or a charitable gift from the adult’s property if the EPOA permits the attorney to do so, or if (PAA s 20):
- The adult will have sufficient property remaining to meet the personal care and health care needs of the adult and the adult’s dependents, and to satisfy other legal obligations
- The adult, when capable, made gifts or loans, or charitable gifts, of that nature; and
the total value of all gifts, loans and charitable gifts in a year is equal to or less than a prescribed value (set out in s 3 of the PAR)
According to s 20(2) of the PAA, an attorney may receive a gift or loan, if the EPOA permits.
4. Creating a Will and Designating Beneficiaries
Attorneys are not allowed to make a will on behalf of an adult. According to s 21 of the PAA, any will that is made or changed by the attorney on behalf of an adult is not legally valid. Further, if the adult has given instructions prohibiting delivery of the will to the attorney(s), then a person must not provide the will to the attorney(s).
An attorney is also not allowed to dispose of property that is designated as a testamentary gift in the adult’s will. Section 19(3)(d) of the PAA provides an exception to this only where the disposition is necessary to comply with the attorney’s duties. According to s 20(5), an attorney is allowed to change a beneficiary designation, in an instrument other than a will, in very limited circumstances set out in s 20(5)(b) of the PAA, including:
- A change to a beneficiary designation if the court authorizes the change
- The creation of a new beneficiary designation if the designation is made in
- An instrument that is renewing, replacing or converting a similar instrument made by the capable adult, and the designated beneficiary remains the same
- A new instrument that is not renewing, replacing or converting a similar instrument made by the capable adult, and the newly designated beneficiary is the adult’s estate
Where there exists a POA, an attorney may execute a deed under the seal of the attorney on behalf of the adult (whether an individual or a corporation). According to s 7 of the PAA, as long as it is within the scope of the attorney’s authority, such a deed is binding on the adult and hasnthe same effect as if it were under the seal of the adult.
6. Delegating and Retaining Services
An attorney is not allowed to delegate their authority to another person. According to s 23 of the PAA an attorney must not delegate powers and authorities to others, unless expressly empowered to do so in the POA. An attorney may delegate financial decisions concerning investment matters to a qualified investment specialist (e. g. mutual fund manager) in accordance with the PGTA or the TA, s 15.5.
An attorney is permitted to retain services. According to s 20(4) of the PAA, an attorney may retain the services of a qualified person to assist the attorney in doing anything the adult has authorized.
An attorney who acts in the course of their legal duties is not liable for any loss or damage to the adult’s financial affairs, if the attorney complies with the following (PAA s 22):
- The statutory duties of the attorney, as set out in s 19 of the PAA
- Any directions given by the court under s 36(1)(a) of the PAA
- Any other duty that may be imposed by law
To protect innocent persons from liability arising from transactions made after the POA relationship has been terminated, BC’s PAA modifies the common law regarding the effects of termination. If the attorney or a third party has acted in good faith, the PAA shifts the loss from the attorney or third parties to the adult.
Section 3 of the PAA protects the attorney from liability for acts done in good faith and in ignorance of the termination of their authority. Section 4 protects third parties who deal in good faith with the attorney, where the third party and attorney are unaware of the termination.
NOTE: Section 57 of the LTA provides that the principal may file the termination of the agency in the Land Title Office. Filing the notice protects the principal from registration of “instruments” (as defined in the LTA) executed by the attorney after the termination of their authority, even though the attorney and a third party may have been ignorant of the termination.
8. Records and Accounts
The adult’s account must be kept up to date (PAR s 2). The adult’s assets and accounts must also be kept separate from those of the attorney and any third parties (PAA s 19(4)). Per s 2 of the PAR, all assets belonging to the adult held by the attorney, and all books, documents, and account records entrusted to the attorney must be available for production to the capable adult at a reasonable time (usually during annual reviews).
9. Expenses and Remuneration
Payment to an individual (as opposed to the PGT) for service as an attorney under a POA is less common. However, s 24 of the PAA allows for an attorney to be compensated where authorized in an EPOA, provided that the rate or amount is set out in the EPOA. An attorney may also be reimbursed for reasonable expenses properly incurred in acting as the attorney.
F. Changing, Revoking, or Ending a POA
A POA will be suspended or end in the following circumstances (see s 29(2) of the PAA):
- Death of the adult or the attorney
- Bankruptcy of the adult
- Court appointment of a committee
- Revocation by the adult, who is still capable
- Resignation of the attorney(s)
- If the attorney is the adult’s spouse and their marriage (or marriage-like relationship) ends
- If the attorney is a corporation and that corporation dissolves
- If the attorney is convicted of a prescribed offence, or an offence where the adult is the victim
- Per s 19.1 of the PPA, a POA is suspended if the PGT becomes the statutory property guardian
Adults who are making a POA should be informed of the procedure for ending (revoking) or changing the POA. Likewise, adults should also know how an attorney may resign. In many situations, adults are unaware of their right to end a POA. As long as an adult has capacity, they can revoke a POA. Details of how this is done appear below.
1. Revocation by an Adult
An adult who has capacity can change, revoke or end a POA at any time. A POA must be revoked in writing. This is called a “Notice of Revocation”. Telling someone that the POA is no longer in effect is not enough. Each attorney must be given a signed Notice of Revocation (PAA s 28(2)), and the revocation will not be effective until such notice has been given (PAA s 28(4)).
Although the PAA does not set out how a Notice of Revocation is to be delivered to the attorney(s), it is suggested that the adult deliver it by one of the following methods:
- By registered mail to the person’s last known address
- By leaving it:
- With the person
- At the person’s address
- With an adult who appears to reside with the person
- If the person operates a business, at the business, with an employee of the person
- By transmitting it by fax to the person with the number they provided for notification purposes
An adult should check if their POA lists other requirements or steps related to revoking in addition to the requirements from the legislation.
In addition to informing the attorney(s) in writing of the revocation, a capable adult who wishes to revoke an existing POA should:
- Request that the original POA be returned, if it has been given to someone
- Contact all businesses, institutions, and individuals to whom the existence of the POA was known, and notify them in writing that the POA has been revoked, effective immediately, requesting that they destroy all copies of the document which they possess;
- Register the revocation at the Land Title Office (only applies where the POA deals with land transactions)
- Inform Nidus, if the POA was registered with Nidus
2. Resignation of the Attorney(s)
An attorney can also formally resign at any time. An attorney must give written notice to the adult and any other attorney(s). The resignation of an attorney is effective when written notice is given, or on a later date specified in the notice.
An attorney who loses the capacity to fulfill legal duties should resign. Likewise, if an attorney is unable or unwilling to act on behalf of the adult, according to the adult’s instructions, wishes and values, then the attorney should resign.
As of September 1, 2011, s 17(1) of the PAA outlines that an attorney who does not sign a POA is not obligated or authorized to act as an attorney. It is possible to refuse becoming an attorney by simply choosing not to sign the POA. Section 17(4) also states that an attorney who does not sign is not required to provide any notice of any kind but ethically the attorney should let the adult know. If a person does sign the POA, and wishes to resign from acting as attorney, then written notice must be provided to the adult, any other attorneys and, if the adult is incapable, a spouse, near relative or, if known to the attorney, close friend of the adult.
If an adult who has capacity does not want the attorney to act, then the adult can revoke or change the POA. If an Aadult no longer has capacity and others are concerned about the conduct of an attorney, then you may wish to contact the PGT. Refer to section VIII. B. 2: Responding to Adult Abuse and Neglect—Public Guardian and Trustee.
3. Duties After Termination
Even after a POA has come to an end, an attorney may not use any information gathered during the course of duties as attorney for personal or private profit. Nor can an attorney solicit customers from the adult’s business.
Regarding POAs dealing with Land: a POA which authorizes the attorney to deal in land transactions for the adult will expire automatically after three years from the date of its execution, unless it is an EPOA or the document expressly exempts itself from that requirement in s 56 of the LTA.
G. No Capacity and no POA
If an individual does not complete a POA while they are capable, and later becomes incapable of managing their financial affairs, the adult may be able to create an Representation Agreement, which has a lower test of capacity. Alternatively, a capable, interested person can apply to the court for committeeship, in order to manage the incapable adult’s affairs. If the adult owns land or operates a business, a committeeship will be required.
The PGT may take steps to become committee of estate if:
- There is no valid enduring power of attorney
- The individual is incapable
- There is a need for someone to make financial decisions
- There is no suitable person available and willing to apply to be committee
- There are no other less intrusive options
The PGT charges a fee to provide estate management services in accordance with the Public Guardian and Trustee Fees Regulation, BC Reg 312/2000 [PGT Fees Regulation].
H. Note on POAs for LSLAP Students
When a client approaches LSLAP for assistance with creating a POA, the following a series of questions should be asked to ascertain the kind of POA that would best suit the needs of the client without putting the person at risk of being taken advantage of:
- Is the client (mentally) capable, in the view of the clinician, of granting a POA? The presumption is that all adults are capable. The general test is the ability to understand and appreciate the meaning of what they are trying to do in each particular case. Warning signs of temporary or ongoing incapacity can include the following (bear in mind the list below is not comprehensive and the indicators below do not necessarily indicate incapacity):
- Sudden confusion, short term memory problems, disorientation
- Signs of depression
- Appears worried, distressed, overwhelmed
- Signs of substance abuse
- Inability to answer open ended questions
- Refer to BCLI Guide on Undue Influence for a full checklist at: http://www.bcli.org/sites/default/files/undue%20influence_guide_final_cip.pdf
- Why does the client want a POA?
- For what purpose does the client require someone else to manage their financial affairs?
- Does the client need to authorize broad powers, or can powers be narrowly defined and still meet the needs of the client?
- What tasks does the attorney need to be authorized to do to meet the client’s needs?
- When does the POA need to start?
- Is it appropriate for the POA to have a built-in expiration date?
- Has the client thought about who they wish to appoint as attorney(s)?
It may be helpful for students to provide information or guidance to clients on who the client should appoint as attorney, to reduce the risk of financial abuse, based on the following considerations:
- Appoint someone who will respect the client’s unique values and interests
- Appoint someone who is familiar with the duties and limitations of the role of attorney, or who will take the time and initiative to become educated about them
- Consider who is best placed to carry out the responsibility of handling the client’s financial matters: Does the person live nearby? Is the person easy to communicate with? Does the person like to deal with finance and money, or have some training or education in this regard?
- A spouse is not always the best choice – a partner could be in a situation of crisis when the older adult becomes incapable and the client should consider whether it is best for the partner to take on the additional responsibility at such a difficult time.
- Appointing more than one attorney could create practical problems. For example, appointing all of the client’s children can create a situation of conflict where it may be challenging for the adult children to come to an agreement. Having two attorneys under a joint power of attorney can also make it harder to make decisions quickly as consultation and discussion will be required to make any decision. Nonethelesss, multiple attorneys can be appropriate in some contexts.
Students should confer with their Supervising Lawyer if there is any doubt that the client understands and appreciates the POA. Also note that an adult should not be required to have a POA as a condition of receiving any good or services, such as residence in an assisted living or community care facility.
1. Misuse and Abuse of a POA
The misuse or abuse of a POA is a criminal act and can be prosecuted under s 331 (theft by person holding Power of Attorney), s 332 (misappropriation of money held under direction), s 215 (failure to provide necessaries of life), or s 380 (fraud) of the Criminal Code.
If a student or client has concerns that a person may be abused or neglected, or is at risk of being abused or neglected, then in most instances the student should discuss these concerns with the client and provide them with access to appropriate support services (e.g., the Seniors Abuse & Information Line at: 604-437-1940 or 1-866-437-1940).
If a crime is suspected, consult with the Supervising Lawyer about how and whether to make a report to the appropriate authority. Students need to remember their legal responsibility to maintain professional conduct and client confidentiality. If there is concern that the adult is not capable, it may also be appropriate to refer the concern to the PGT. For example, s 17 of the PGTA allows the PGT to investigate potential abuse of POA relationships. Similar authority for the PGT to investigate abuse and neglect are provided by s 34 to 36 of the PAA.
Power of Attorney abuse is a constant concern and unfortunately a frequent occurrence. The abuse may manifest in pressure to grant a POA, or misuse of funds or property under a POA. Try to meet with the client alone, or at least without the potential attorney in the room, to be certain that the client truly wishes to create a POA and grant powers to the potential attorney in question. Make sure to inquire about the relationship between the client and the proposed attorney, and be on alert for possible undue influence or fraud. Refer to BCLI Guide on Undue Influence, above, for a full checklist of considerations and what to watch for. For more information about abuse and neglect of older adults, you can also consult the following resources:
- BC Centre for Elder Advocacy and Support: www.bcceas.ca
- Canadian Centre for Elder Law: www.bcli.org/ccel
- Public Guardian & Trustee: www.trustee.bc.ca
- Vancouver Coastal Health: Resource: www.vchreact.ca
- Advocacy Centre for the Elderly website: www.acelaw.ca
NOTE: It is possible, and even common, for an adult to appoint an attorney under the PAA (to make financial decisions) and appoint a different person as a representative, under the RAA (to make health care decisions). This commonly happens where a person who knows the personal wishes and values of the adult is adept at handling health care decisions, and a more financially astute person is chosen as attorney.
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