As life expectancy increases, the loss of capacity to manage one’s own affairs can be a growing concern. With the population aging, chronic and degenerative illnesses that affect mental capacity are becoming increasingly common. In many cases, the onset of incapacity may be a gradual process. The individual, while still competent, realizes that incapacity is likely or even imminent.
Faced with this possibility, many people wish to plan for future management of their affairs by granting an enduring power of attorney (EPA) to a family member or trusted advisor. There is the expectation that this person, called an attorney, will have authority to manage the individual’s financial affairs when they become mentally incapable of doing so themselves.
In Alberta, the financial type of power of attorney is referred to as an “enduring power of attorney”, whereas in Ontario, it’s called a “continuing power of attorney”. Other provinces may have different names. In Quebec, it’s called a "mandate in anticipation of incapacity". For simplicity, this discussion will refer to the power of attorney for property as an “enduring power of attorney” or EPA. The basic features are similar, regardless of the name.
A traditional power of attorney permits an individual to authorize another person to handle his or her financial responsibilities only until the donor loses mental capacity. Upon mental incapacity, the right to manage an incompetent’s personal property can only be legally done through a time-consuming and costly application to the courts for a trusteeship order under the Dependent Adult’s Act or through an EPA.
By creating an EPA, people may legally appoint a person of their choice to handle their financial activities, should a future incapacity occur. Use the Incapacity Planning Questionnaire to help you design your document.
Enduring Power of Attorney (EPA) is a separate document from your will.
The Enduring Power of Attorney:
Strongly consider having your EPA witnessed by a lawyer, so that the lawyer may verify the capacity and free will of the donor. The lawyer who assists you with your will is likely the best person to contact since he or she will already be familiar with your intentions.
Ask the same person or people to act as your attorney and as the executor of your will. There will be a smoother transition if the person winding up your estate is also looking after it through a period of incapacity.
Your appointed attorney will be responsible for administering your property in the case of your incapacity. While you are still capable, take the following steps to ensure the success of that process:
Once invoked, the attorney takes the EPA document to each financial institution to set up their authority to manage any investments held there. The attorney should retain an original, and have each institution make a certified true copy, as needed for their records. Other organizations that may request a copy of an EPA include service companies (for purposes of turning off your phone service, cable service, etc), municipal governments (for the purposes of paying property tax), any company that has services that may require cancellation cancel subscription services, and so on.