What Happens If You Don’t have an Enduring Power of Attorney?
When I meet with my clients and explain what happens if they lose capacity and do not have an Enduring Power of Attorney in place, I am frequently met with a look of terror, the colour drains from their face and they say something to the effect of “Wow. I didn’t know that. We have to tell Maud and Arch, they don’t know that either, and I’m sure Jen and Jeff don’t realize that either”. So, with all that uncertainty, I thought it was high time I wrote an article on the matter, in the hopes of educating as many people as possible in this regard.
In a nutshell, if you do not have an Enduring Power of Attorney in place when you lose your mental capacity to manage your own affairs, then the Public Guardian and Trustee takes over your affairs until someone else is appointed by the Court. In the meantime (sometimes several months) NO ONE, not even your spouse or a child, has the legal power to manage your affairs in the absence of an Enduring Power of Attorney or a Court Order. People often think that if you are joint with your spouse on bank accounts or your home for example, then your spouse/joint owner will be able to deal with these things for you if you ever lose capacity. This is not the case. Do not assume that your spouse, parents or kids will be able to make those decisions for you. Your financial information is private. Our Privacy Laws go a long way to protect your information from getting in the hands of anyone but you. The spouse/joint owner will still need an Enduring Power of Attorney or a Court Order to act on your behalf.
An Enduring Power of Attorney is a simple and inexpensive part of your Estate Plan, and is very easy to put in place while you have the capacity to do so, just ask your lawyer to draft one for you. Make sure you appoint someone you trust, AND an Alternate in the event that your first Attorney is unable to act or has predeceased you.
If you fail to prepare an Enduring Power of Attorney while you have capacity, then a Committee will be appointed by the Court. This requires a Court application setting out the circumstances of the case. Also, Affidavits have to be obtained from two doctors proving mental incapacity. Court applications are time consuming and expensive…….and in this instance, avoidable if you do proper incapacity planning.
The best way to ensure that you get to pick the person you want to make financial decisions for you in case you can’t is to have an Enduring Power of Attorney.
This information applies as a general rule but may change depending upon the specific circumstances of your own situation. You should consult a lawyer before acting on any of this information. If you have any questions, please do not hesitate to contact Vanessa DeDominicis directly on 250-869-1140 or firstname.lastname@example.org. Vanessa practices in the area of Wills and Estates with Pushor Mitchell LLP in Kelowna, B.C.