Estate Planning #2 – Power of Attorney
Another possibility that none of us wants to consider but one that most of us probably should, is the question of what happens if we become mentally incapacitated. Who makes decisions about our medical treatment when we are not able to and who looks after our property and finances?
Like most of the questions that come up when considering your estate planning, these ones are much easier if faced early, before they are a necessity. A Power of Attorney or Continuing Power of Attorney for Property is the person or persons you assign to look after these decisions on your behalf when you are not mentally able to. Do not be put off by the word “attorney”, the person you choose does not need to be a lawyer or legal professional. Most often your Power of Attorney will be a friend or family member.
There are two separate legal documents for each of the two types - Power of Attorney and Continuing Power of Attorney for Property. You can name the same person to look after both your personal care and your finances or you can list different people for each. You can also name more than one person as your Power of Attorney if you think the decision-making will be too challenging or time consuming for one person to accomplish.
If you have a particularly complicated financial situation or you anticipate that it would be difficult for someone to carry out your wishes without causing family turmoil, you might want to consider a Trust Company for your Power of Attorney. The company would charge a fee for this service, but their impartiality and professionalism might be worth it to you depending on your circumstances.
You can be as specific as you want to be in your documents outlining your wishes for your Power of Attorney to follow. You can set specific instructions for your care if you are incapacitated or instructions for what to do with specific assets, investments etc. If you do not wish to appoint a Power of Attorney (and there is no legal requirement to do so), you can instead outline these instructions in what is called a Living Will. It is a document to be followed while you are still living, but unable to voice these wishes yourself. Some people choose to include a Living Will with their Will.
However, if you do not have a Power of Attorney established and you do become mentally incapacitated, the government of your province by default becomes your guardian and decision maker. In these instances, a friend or family member can apply to be appointed your guardian, generally a far better option for you and your loved ones.
It is very important that you speak with the person you are considering to select as your Power of Attorney or Continuing Power of Attorney for Property prior to naming them. There is a great deal of responsibility that comes with the role and some people may not be comfortable with it. Some of the decisions that they might face could be very challenging, especially if you have not been very clear in your desires. As well, the circumstances that your Power of Attorney will find themselves in are rarely, if ever, positive ones.
You are not required to have a lawyer do the paperwork to appoint your Power of Attorney and Continuing Power of Attorney for Property however seeking a legal opinion can be beneficial especially if your circumstances are complicated.
For more information, the Ministry of the Attorney General in Ontario has published a booklet which contains detailed information on selecting your Power of Attorney and the forms required to establish your Power of Attorney and Continuing Power of Attorney for Property. It is available online here: