Set up a power of attorney that works for you

Power of attorney clauses

Not all powers of attorney are created equal, a reality Seana is coming to terms with.

Seana was proactive, ensuring her mother’s affairs would be in order. That included her mother, Beth, granting Seana power of attorney.

Beth, 81, lives independently but has been showing signs of dementia. About a year ago, her doctor assessed her incapable of driving. Beth’s imprudent sale of her vehicle, for 15% of what it was worth, brought her financial vulnerability to the forefront for Seana.

Seana took the power of attorney to the bank so she could access and monitor her mother’s transactions but she came up against a brick wall. The power of attorney contains a clause saying it doesn’t take effect until Beth has become incapable of managing her financial affairs and her lack of capacity is confirmed by a statutory declaration made by a doctor.

Has Beth’s dementia reached the level a doctor would assess her incapable of handling her financial affairs Seana doesn’t know. She’s unable to get her mother assessed because Beth was so upset by her doctor determining she was unable to drive, she now refuses to see the doctor.

Even if the assessment could be arranged, consider the administration and expense of having a statutory declaration prepared and then sworn by a doctor.

It didn’t have to be this way. A power of attorney is effective as soon as it is signed unless there is a clause that says otherwise. Your lawyer or notary shouldn’t put that clause in the document without explaining the implications to you.

My typical recommendation is to avoid such clauses, allowing the power of attorney to take effect immediately.

You won’t need help managing your financial affairs at the time you sign your power of attorney but why put an administratively difficult and expensive roadblock in place for when you do need help? A bonus is you might appreciate help looking after things while you are “snowbirding” in Palm Springs or if you begin to have mobility issues.

Most financial transactions can happen electronically, but some still require you attend in person. Your power of attorney can attend to anything you would otherwise have to do yourself.

So, what’s to stop your children, to whom you appoint power of attorney, from running amuck with your financial affairs before you need their help? It would be unlawful for your power of attorney to take any action without your direction while you remain capable of handling your own affairs. For your own piece of mind, you can choose to hang onto the document, not giving it to those you appoint until you want them to use it.

The power granted in a power of attorney cannot be exercised without having the actual document, or a certified copy, in hand. You can choose, at any time, to revoke it if you have second thoughts. Ensure you get advice about how to do that properly.

So what can Seana do to help protect her mother from financial vulnerability? Maybe her mother would agree to make a new power of attorney that doesn’t contain the restrictive clause. But, of course, she cannot do that if she is no longer cognitively capable. If not, and Seana cannot figure out a way to get her mother medially assessed, Seana could report the matter to the office of the Public Guardian and Trustee, as contemplated by section 32(b) of the Adult Guardianship Act.

I am not familiar with the actual steps the Public Guardian and Trustee’s office would take and how it could somehow secure a medical assessment when Seana is unable to, but I expect those steps would be expensive, paid for out of Beth’s assets.

There are many variations of powers of attorney. It’s not just a matter of choosing whether or not the power of attorney becomes immediately effective.

There is a range of powers you can grant, from very narrow to very broad. Also, if you appoint more than one, they can be required to act with the others or separately.

Ensure, when you have a power of attorney prepared, you are advised about the various options so you can make informed decisions resulting in a document that will optimally serve your purposes.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Changing the executor of your will

Your will's executor

I had three similar inquiries this past week.

Each couple made wills when their children were young. In the horrible event of them both dying before their children grew up, they named a responsible adult in their lives (a sibling or parent) as executor and they named guardians for their children. Their wills had trust provisions ensuring their children’s inheritance would be managed until some appropriate age, typically 25.

Their children are now adults, with children of their own and they now want one (or more) of their children to be executor once the second of them passes away, and they wonder about the trust and guardianship provisions that are no longer applicable.

Do they need to incur the expense of new wills?

Before I answer that, how about high fives to each of them. It is excellent having an estate plan in place when you have minor children. I gave a couple reasons in my July 14 column, but perhaps I should dedicate a column solely to that issue.

It is also good they are consulting a lawyer to review their estate plan. You can read my advice about reviewing your will in my May 5 column. (I would have recommended a review more often than 20 years but better late than never.)

First, I’ll address the inapplicable trust and guardianship provisions.

They’re nothing to worry about. They have become a bunch of irrelevant words that won’t get in the way. There’s no need for a new will to remove them.

The executor provision is more interesting.

One way to deal with it is to consider asking the person you have named as executor to not take on the role. In that circumstance, Section 131 of the Wills, Estates and Succession Act kicks in. (https://www.bclaws.gov.bc.ca/civix/document/id/complete/statreg/09013_01#section131).

It says (and I’m paraphrasing) if you die with a will and your named executor renounces executorship or is unable or unwilling to fill that role, the court can appoint someone else to fill that role.

It gives a list of priorities. At the top of the list is a beneficiary who has the consent of the other beneficiaries. Next is a person nominated by a beneficiary, with the consent of the beneficiaries.

Let’s consider how that would play out.

The second of you and your spouse dies. Your sister is named executrix but has agreed not to take on the role. Your children can decide that one or more of them will administer the estate, or they could agree to appoint someone else.

You could be involved in making those decisions now so your children have clarity. As long as everyone agrees, any added expense in the administration of your estate should be minimal.

If you prefer to eliminate uncertainty and have the executor provision in your will properly dealt with, consider making the changes by way of a “codicil”. Don’t let that word scare you. It is simply a document that refers to your will and sets out how it is changed. It doesn’t even have to be called a codicil.

I’ve written about how to do that without the assistance of a lawyer in previous columns, published April 21 and 28.

There might be important reasons, other than executor designation and expired guardianship and trust provisions, to have your will redone. Please ensure you periodically review your will with a lawyer as I’ve recommended in the column I referenced.

If these are the only issues to be addressed, maybe I’ve saved you a few bucks. If you have difficulty finding any of the columns I’ve referenced online, e-mail me at [email protected] and I’ll help you.

If you have any end-of-life related column topics you would like me to write about, please let me know.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Protecting seniors in cognitive decline from being taken advantage of

Protecting seniors

Taking advantage of a senior in cognitive decline is a special kind of ugly.

I recommend giving trusted folks the authority to look after your affairs in case you lose the capacity to do so yourself.

In my last column, I shared a way for a loved one to give a limited, though significant level, of authority even after they have lost capacity to look after their own affairs.bBut giving others authority over your financial affairs leaves you vulnerable.

That leads to the question, what we can do if we believe a vulnerable senior is being exploited by someone who should be a trusted representative?

The Power of Attorney Act (Section 34) and the Representation Agreement Act (Section 30) say a report can be made to the Public Guardian and Trustee.

The PGT is a provincial government-appointed independent agency with a mandate that includes protecting the legal, financial, personal and health care interests of adults with diminished capacity.

Grounds for making a report include your belief a person who was appointed, revoked or changed a Power of Attorney or Representation Agreement of someone who lacked the capacity to do so.

Another is you believe fraud, undue pressure or some other form of abuse or neglect was used to induce someone to make, change or revoke a Power of Attorney or Representation Agreement.

A third is is you believe the person appointed as attorney or representative is abusing or neglecting the person they’re supposed to be acting for, or otherwise failing to comply with their duties.

The PGT must promptly review such a report. It has broad powers to investigate and to take appropriate steps to rectify the situation which could include applying to the court to revoke the authority of the reported representative.

You don’t need to rely on the PGT, though. You can take matters into your own hands and make your own application to the court, pursuant to the Patients Property Act.

The starting point is the court determining if the vulnerable senior is or is not capable of handling their own affairs. If appropriate, the court will appoint you as their representative or “committee”.

If you’re interested in a play by play of how that process works, I invite you to read the legal decision of Seifred v. Arnold, 2021 BCSC 278, which can be found here.

The case tells a tale that will sound all too familiar to some readers.

Mrs. Seifred’s son Daryl had been her power of attorney and health representative for many years. Abruptly, without consulting Daryl, Seifred’s two daughters arranged for their mother to appoint them as her representatives instead of Daryl. They also arranged for her to sell her house and give each of them $50,000.

Then, they moved her to a different city, poisoned her against her son and restricted his access to her.

The daughters, as it turns out, weren’t all bad and Daryl wasn’t an angel.

The judge went through a list of 10 relevant factors when deciding between Daryl and one of the two daughters, as to who would be appointed committee for their mother.

The daughter, a practicing nurse, won out as best advocate for the patient’s medical need. They were tied on ability to provide love and support to the patient but Daryl won out on most of the other factors and he was the one appointed.

You can read the decision for the full list of factors.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Dealing with various forms of representation agreements in B.C.

'Rep-7s' can help