General-information disclaimer: This article provides general information about Ontario law and is not legal advice. Legal outcomes depend on the specific facts. Obtain advice about your own situation.
Many people prepare a will and assume it covers decision-making if they become ill. A will only operates after death. A continuing power of attorney for property is a separate document used during life to authorize another person to make property and financial decisions within the authority granted.
The person chosen can have significant power, so the appointment deserves careful thought.
A realistic scenario: what can go wrong without advance legal planning
The following is a fictional/composite scenario created for education.
An older homeowner has a stroke and temporarily cannot manage banking or sign documents. The family assumes the adult daughter can simply step in because she is the closest relative. The bank asks for legal authority. No power of attorney exists, and the family must explore other legal options while bills and property matters continue.
What you should know
1. What it covers
Property can include banking, investments, bills, real estate and other financial matters. The document can be broad or contain limits.
2. Continuing authority
A properly drafted continuing power of attorney can remain effective during incapacity, subject to the terms and Ontario law.
3. Choosing the attorney
Trust, judgment, availability and record-keeping ability matter. The closest relative is not automatically the right choice.
4. Multiple attorneys
People may appoint more than one attorney and specify whether they act jointly or otherwise, but practical signing and decision issues should be considered.
5. Duties and records
An attorney does not become the owner of the grantor’s property. The attorney has legal duties and should maintain appropriate records.
6. When it begins
The document can be designed to operate immediately or according to specified conditions. The practical consequences should be understood before signing.
Practical checklist
- Choose someone trustworthy and organized.
- Name an alternate if appropriate.
- Discuss whether authority should begin immediately or later.
- Keep the original accessible but secure.
- Review the document after relationship, health or asset changes.
The practical lesson
A power of attorney is a planning tool for incapacity, but because it can grant substantial authority, it should never be treated as a casual form.
Get help before the issue becomes urgent
Thomas, Efraim LLP offers a free Will and Powers of Attorney review and a free 30-minute consultation to discuss whether your current documents still fit your circumstances.
