Top Reasons Why You Need A Power of Attorney
A Power of Attorney (POA) is a living will that gives trusted persons the authority to manage the property or make decisions regarding the health care of those who have become incapacitated during their lifetime.
There are two types of POAs: power of attorney for property and power of attorney for health care.
Continuing Power of Attorney for property
In the event a person becomes incapacitated or has an illness or infirmity, a continuing POA for Property allows another person to manage one’s finances, including property and bank accounts. This type of POA is ‘continuing’ in the sense that one does not need to be fully incapacitated for the powers to ‘spring up’ and take effect. This document may be used where one still has capacity but, due to illness or infirmity, still needs help looking after his/her affairs.
An attorney for property will be given wide powers to deal with all aspects of one’s financial affairs, including access to bank accounts, dealing with investments, making tax returns, claiming and dealing with benefits, settling any liabilities, and even selling one’s property.
What happens if you don’t have a Power-of-Attorney for Property
Without a Power of Attorney for property, trusted family members will not be able to get access to the bank accounts or manage the assets of the principal if they hold an account solely in their name.
In that case, the Public Guardian and Trustee will become the statutory guardian. A spouse or other family member will have to make an application under the Substitute Decisions Act to the Superior Court to be given the authority to take over the guardianship from the Public Guardian and Trustee.
By having a powers-of-attorney for property, an individual ensures that if anything ever does happen in the future that renders him/her incapacitated, trusted loved ones have the power to look after that person’s affairs in the way that he/she would want. It also minimizes the burden imposed on family members during an already difficult time by eliminating the need to apply for guardianship over one’s property. Having a Power of Attorney therefore provides an individual with the peace of mind that one’s property and finances will remain in order.
Power of Attorney for Personal Care
Unlike a continuing power of attorney for property, a POA for personal care can only ‘spring up’ if you become fully incapacitated. This type of power of attorney allows the trusted person to make decisions relating to one’s medical care and treatment, including where one lives, hospitalization, and the administration of life saving treatment.
What Happens If You Don’t Have a Power-of-Attorney for Personal Care?
If an individual does not have a power of attorney for personal care, the Health Care Consent Act states that a hierarchy of persons will be afforded control over one’s health care decisions.
The hierarchy of persons are
- spouse or partner
- parent(s)
- sibling
- any other relative
The family member entitled to act per statute may not be the person one would have chosen and may not have the same medical or religious views as the person who has become incapacitated or ill. This can be avoided by having a power of attorney for personal care in place.
By having a powers-of-attorney for personal care, an individual ensures that if anything ever does happen in the future that renders him/her incapacitated, trusted loved ones have the power to look after their family member’s affairs in the way that he/she would want. It also minimizes the burden imposed on family members during an already difficult time by eliminating family disputes over health care decisions.
Springing and Limited Powers of Attorney
A springing power of attorney assumes full control of another person’s decisions if that person becomes fully incapacitated. The powers of attorney come into effect at the moment the principal becomes disabled or incapacitated and expires on the principal’s death.
A limited powers of attorney, on the other hand, may act on a person’s behalf for a short or limited period of time usually for a single transaction, such as managing one’s stock, selling a house, or some other limited transaction if the principal is travelling overseas, is having a surgery, or chooses not to act on his own behalf for some other reason. This type of power of attorney can be revoked as soon as the principal requests it.
Do You Need a Lawyer To Get a Power of Attorney?
Not necessarily, but there are good reasons to use a lawyer to draw up these important documents.
Designating a trusted friend or family member as a power of attorney for finances involves filling out a form and having it signed, witnessed and notarized by an adult. You have to be an adult (18 years) and be competent. However the process can be a daunting task, particularly when it comes to complicated financial transactions or matters of life and death. Most people choose to have a lawyer to draw up these important documents.
Kalfa Law Firm can assist you in designating a power of attorney to a trusted friend, advisor, or family member to act according to your specific wishes should you become incapacitated or ill.
-Shira Kalfa, BA, JD, Partner and Founder
Shira Kalfa is the founding partner of Kalfa Law Firm. Shira’s practice is focused in corporate-commercial and tax law including corporate reorganizations, corporate restructuring, mergers and acquisitions, commercial financing, secured lending and transactional law. Shira graduated from York University achieving the highest academic accolade of Summa Cum Laude in 2012. She graduated from Western Law in 2015, with a specialization in business law. Shira is licensed to practice by the Law Society of Ontario. She is also a member of the Ontario Bar Association, the Canadian Tax Foundation, Women’s Law Association of Ontario, and the Toronto Jewish Law Society.
© Kalfa Law Firm 2018
The above provides information of a general nature only. This does not constitute legal advice. All transactions or circumstances vary, and specified legal advice is required to meet your particular needs. If you have a legal question you should consult with a lawyer.
