Depending on the manner in which the Enduring Power of Attorney is prepared, it can either be “immediate” or “springing”. You choose whether to allow the person you appoint as your attorney to exercise his or her power immediately after the EPA is signed, or only upon your incapacity.

Immediate Power of Attorney

With an immediate Power of Attorney, the Attorney’s powers come into effect immediately upon signing. Although you continue to have access to all your assets and control over them, your Attorney too has the authority to deal with your business and financial matters. An immediate Power of Attorney gives you the convenience of having someone else sign documents or cheques for you now, even though you are still capable of managing your affairs. This option can be a valuable tool for individuals who are away for extended periods of time and is also commonly used for Donors who have mobility issues or for Donors who find themselves burdened by the responsibilities of the management of their affairs, and would benefit by the assistance of an Attorney.

Springing Power of Attorney

With a springing Power of Attorney, your Attorney’s powers come into effect only if and when you lose the capacity to handle your own financial affairs. Typically, the Power of Attorney specifies how it will be determined that you have lost this capacity. For example, you can state that the declaration of a single physician is required to establish that you have lost capacity or you can specify some other triggering event within the Power of Attorney.

If the Power of Attorney does not state how incapacity is to be determined, or if the triggering event for some reason cannot be met (for example, the EPA states that the declaration of a named family doctor is required, and he or she has died or retired or is not available), then the provisions of the legislation govern the matter, and the written declaration of two physicians will be required. Regardless of whether you grant powers immediately or postpone your attorney’s authority to a future time, the powers granted to the Attorney will continue should you become mentally incapacitated.

If for any reason you lose mental capacity, and do not have an Enduring Power of Attorney in place, it will likely be necessary for an interested person to apply to the Court of Queen’s Bench to be appointed as your Trustee. Depending on how your financial affairs are set up, mental incapacity can make it impossible for your family to deal with even simple routine matters such as paying your utility accounts and credit card bills, renewing your investments, and renegotiating your mortgage. Issues regarding mortgage and loan renewals will arise even if title to your home and your bank accounts are jointly held with your spouse. The Enduring Power of Attorney is a far more convenient and cost-effective way of ensuring that there is someone acting on your behalf and taking care of your affairs should the need arise.

An Enduring Power of Attorney avoids various disadvantages of the court trusteeship appointment which would otherwise be necessary. For example:

• You have the ability to choose whom you wish to have act as Attorney, whether it be a family member or a trusted friend. The persons who have priority under law to apply to be your trustee pursuant to a Court order may not be the persons whom you want dealing with your financial affairs. The Enduring Power of Attorney allows you to maintain a greater deal of control over your property matters.
• The procedure is far quicker than the obtaining of a Court Order. The Attorney’s powers come into effect as soon as the requirements set forth in the EPA are met, (for example, as soon as a physician’s declaration of incapacity is obtained).
• The cost and trouble of requisite Court applications can be avoided. A court appointed trustee generally must return to Court on an on-going periodic basis to have his or her accounting records approved, and to have his or her appointment renewed. The frequency of these required applications is determined by the Court. These reviews are inconvenient and costly, and often prove to be a nuisance and an invasion into the privacy of family financial matters.

With an Enduring Power of Attorney, there is no requirement that the Attorney make periodic accountings to the Court. However, with a Power of Attorney you do retain the protection that the Attorney must provide to the Court a proper accounting of the affairs handled by him or her, upon application by you or any interested person, if a question is ever raised as to whether the Attorney has acted properly. The Attorney must therefore at all times maintain complete and proper accounting records in respect of the affairs handled by the Attorney on behalf of the Donor.

Typically, people choose their spouse, adult interdependent partner (common law spouse), family member or a trusted friend to act as their attorney. You do not have to choose the same person to be both your Attorney under your EPA and your health care agent under your Personal Directive. In some instances it can be preferable to have a different person for each role. You should appoint an alternate Attorney to act in the event that your first choice has died, or is unable or is unwilling to carry out the duties required. You can appoint more than one person to act as co-Attorneys; if you do so, you must ensure that you choose persons who will work well together and will trust and respect one another.

In many instances it can be beneficial to have the same individual or individuals who are appointed as your Attorneys be appointed as the executor or executors under your Will. In that way, the Attorneys who have had control of and responsibility for your affairs during your lifetime, will continue to be responsible for the administration and winding up of your affairs after your death. In choosing an Attorney, you should select someone who will act in your best interests in managing your finances. This person must invest your assets in a manner which provides sufficient funds to meet your needs and the needs of your dependants for the duration of your life. The Attorney must understand that although he or she has control of your assets, they must be used only for your best interests.

An EPA does not give an Attorney the right to make an early distribution of your estate. In exercising their powers and dealing with the Donor’s assets, Attorneys must be cautious to ensure that the Donor’s intentions under his or her Will are not thwarted by the actions of the Attorney. For example if a particular asset is specifically gifted under the will, sale of that asset by the Attorney during the Donor’s lifetime will defeat the gift.

Because there is a possibility that the Enduring Power of Attorney may be in effect for many years, the individual you appoint should be of an age such that it is reasonable to expect that they will be able to carry out their duties until your death. It is important to discuss with your intended Attorneys, your wishes in advance so they will be able to carry out their duties in the way you would have wanted. It is also crucial to ensure in advance that your Attorney is willing to assume this time consuming and significant responsibility.