What Is A Power Of Attorney?


I can’t stress enough how important it is to have your Powers of Attorney in place as part of your estate plan. I routinely speak to clients about how important these documents are, and that age should not be a factor in preparing them. Many people under the age of 40 don’t think it is necessary, and like many people, they put them off because they think they don’t need them yet.

The truth is that none of us know what is around the corner, and having them in place sooner than later is good planning. When clients learn what happens when they don’t have them in place, that seems to be the determining factor in why they decide to prepare their documents. So, what are Powers of Attorney, and what do they do?

Powers of Attorney

Your Powers of Attorney gives someone that YOU appoint the legal authority to act on your behalf and make decisions for you when you can’t. The Substitute Decisions Act governs Powers of Attorney in Ontario. These documents often work together, and when deciding who to appoint to act on your behalf, it is essential to consider a couple of key points:

  • How close and available is the Attorney. Are they residents of Ontario?
  • Are you appointing the same person/persons in both documents?
  • Do you want two people to act jointly?
  • Do you trust the person/persons being appointed? Do you have backups?

When we prepare your Powers of Attorney, we canvass these issues carefully. An Attorney can be appointed either jointly or jointly and severally. The difference between these is that both have to agree when appointed jointly. Where both are appointed jointly and severally, one can decide unilaterally. Depending on the Power of Attorney in question, choosing one may be appropriate. It will depend on the circumstances.

In Ontario, the Substitute Decisions Act provides for two types of Powers of Attorney:

  1. Power of Attorney for Personal Care

Your power of attorney for personal care is a document that appoints a person or persons of your choice to make decisions relating to your personal care and health when you are mentally incapable of doing so yourself. The term “Attorney” often confuses people because they assume the word means “lawyer”; however, your “Attorney” is an agent who acts on your behalf and acts in your best interest. The types of decisions your Attorney will make may include such things as:

  • Hygiene
  • Medical decisions and medication
  • Personal safety
  • Diet and nutrition
  • Clothing
  • Housing – including transitioning to long term care/assisted living

Your Power of Attorney is a document that empowers you to anticipate in advance what types of decisions you want made on your behalf. These decisions may include specific directives on procedures that you do not want, such as blood transfusions or being supported by artificial life. It is important to note that this document requires that a qualified medical professional assess you before it can be acted upon. This means that the person making the Power of Attorney (grantor) must be found mentally incapable of making decisions themselves first.

2. Continuing Power of Attorney for Property

A Power of Attorney for property is a document that appoints a person or persons of your choice to make decisions relating to your finances and property. A Power of Attorney for property is normally called a Continuing Power of Attorney, which “continues” into incapacity. This document can be used as soon as it is signed by the grantor and should be kept in a safe place and used responsibly. The document can also be drafted so that it only becomes effective upon incapacity, much like a power of attorney for health decisions.

A Continuing Power of Attorney for Property gives your attorney the ability to do anything with your property and finances which you could do yourself. This includes:

  • Paying bills
  • Giving investment instructions
  • Managing accounts and portfolios
  • Selling and buying Property
  • Dealing with creditors

The only thing that your Attorney can’t do is execute a will on your behalf. Your Attorney has a duty to account for all expenses and transactions that they conduct on your behalf while they are acting under the Power of Attorney. Once you pass away, the document is no longer valid and your estate trustee under your will is responsible for managing your affairs.

Additionally, a Power of Attorney can be prepared for a limited purpose. For example, you may be out of town and need someone to deal with an investment or sale of a property. A Limited Power of Attorney can be prepared for a specific purpose and time period that is only for the specific asset.

When we prepare Powers of Attorney, we conduct a comprehensive review of your circumstances and come up with a plan that makes sense for you and provides you comfort knowing your affairs are in order.

Ready to Get Started?

It all starts with reaching out for a consultation. Leslie meets with you to fully understand your family, estate, and tax situation to help you develop an intelligent solution.
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