Do you need a Power of Attorney (POA)? Maybe.
What will happen if you suddenly become incapacitated, but decisions have to be made? You are considering taking that promotion you’ve been longing for since forever, but it would require you to move abroad for a while. Who will deal with issues relating to your property if something comes up? Maybe you are looking to retire soon and would like to spend months at a time travelling, but who will take care of your affairs if you do that? These are all circumstances many of us can easily relate to, so what can we do to prepare for these possible scenarios?
Do you need a Power of Attorney? Depends!
A Power of Attorney is a written document that allows you to authorize any person of your choice – or multiple people – to make decisions and act on your behalf in certain situations. This person is called an “attorney.”
We have to clarify that you are not required by law to have a power of attorney, but it sure helps to have one. For one, should you become unable or incapable to manage your property and/or make decisions for yourself, someone may be appointed to do so on your behalf – and that person may not be the one you would have picked to do the job! Also, if you do not have a power of attorney in place, the individual(s) looking to act for you may be required to apply for the permission to do so.
So, let’s delve into what a Power of Attorney can really do for you.
There are two main types of Power of Attorney instruments in Ontario:
- Power of Attorney for Property
- Power of Attorney for Personal Care
If the power of attorney is a “continuing power of attorney,” this usually authorizes your attorney, the trustworthy person you picked, to act on your behalf should you become incapacitated at a later time.[1]
Under a continuing power of attorney for property, your attorney can do anything related to your property that you could do if you were capable – anything, except make a will for you.[2] For instance, an attorney could sign the legal documentation required to purchase, sell or mortgage your property.
If it sounds like once you have a power of attorney in place, you give up all power, don’t fret! In fact, you may choose to limit what your attorney can do when acting on your behalf. For example, you may choose to only authorize your attorney to act for the purchase or sale of one specific property. Alternatively, you may only need someone to act for you for a specific period of time, such as when you are out of the country. Any restrictions or limitations are often clearly outlined in the power of attorney document.
A power of attorney for personal care, on the other hand, authorizes the attorney to make decisions about your personal well-being when you are not capable of doing so. This may include decisions regarding your health, safety, and/or nutrition. Once again, when drafting the POA you can be very specific to ensure the document reflects exactly what your wishes are; for example, your power of attorney for personal care may also outline your wishes with respect to specific medical treatments. Furthermore, much like the power of attorney for property, the power of attorney for personal care may contain limitations, conditions and restrictions with respect to the attorney’s decision-making.
Before you even start thinking about creating either document, it’s important to remember that there are certain requirements that must be fulfilled before an individual may either a) create a power of attorney for property or personal care and/or b) act as an attorney for someone’s property or personal care. Seeking the guidance of a lawyer will provide you with all the information and considerations you need to decide the best option for your particular situation.
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[1] Substitute Decisions Act, 1992, SO 1992 c 31 at 7(1).
[2] Ibid, at s 7(2).
