Why You Need An Enduring Power Of Attorney

By the time you reach late middle age, you are at higher risk of strokes, dementia, Alzheimer’s and other incapacitating illnesses. These sad events can occur quite suddenly, out of the blue.

If something like this happens to you, questions may arise about whether you’re still mentally fit to put paperwork in place authorizing others to act in your place. There may not be enough time to make such arrangements, or it may be too late. And these mental capacity issues can lead to bitter disputes among family members.

In one recent case, two sides of a family were pitted against each other in a heated court battle. One group of siblings argued their mom had lost her ability to make independent decisions by a certain date due to rapidly progressing Alzheimer’s disease. The other faction put material before the court suggesting otherwise. The court heard that what distressed the mom most was the two groups’ fighting.

What should you do to protect yourself and avoid these problems?

The law presumes that an adult person is capable of making independent decisions about their financial affairs. The law also presumes that you’re capable of making or changing an “enduring power of attorney.” This is true unless the contrary is demonstrated. (Similar rules are in place for health care decisions and representation agreements).

So it’s best that you think about whom you would wish to act in your place well before anyone can suggest you’re no longer fit to make that choice. The way to express your choice, so far as your financial affairs (not your health care) is concerned, is through a document called an “enduring power of attorney.”

With a power of attorney, you can appoint someone you trust as your agent or “attorney” to act for you in financial matters. But a power of attorney ends if you become mentally incapable.

Not so for an enduring power of attorney, which must specifically state that your attorney’s power is to continue despite such mental incapacity.

This makes an enduring power of attorney very useful. It allows your attorney to make financial decisions for you, perhaps only once you’re no longer able to – without someone (maybe not who you would pick) having to go to court to be appointed a “committee.” That’s an expensive and time-consuming process, which would otherwise have to be undertaken. (A representation agreement for health decisions also avoids the committee court process.)

As we all know, abuses are sometimes committed by the very people who are supposed to protect your interests, especially if you are vulnerable or elderly. There are rules to help prevent that. Some spell out tests for determining your capacity to sign these estate planning documents, set requirements on who must witness and sign them, and say that except for your spouse, parent or children, paid health care workers can’t act as your attorney (or representative).

You should plan ahead and take action. Your lawyer can explain available options and ensure all rules and requirements are followed.

This column has been written by Janice Mucalov LL.B as part of “You And The Law”. It provides information only and must not be relied on for legal advice. Names of the parties in reported cases have been changed or removed to protect their identity. Lawyer Janice Mucalov is an award-winning legal writer

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