If you’re here, you’ve probably been named as a power of attorney – so what next?
If you’ve never acted as a POA before (which most people haven’t!) you might be wondering what that means for you. In this article we’ll discuss everything you need to know about the types of power of attorney as well as the responsibilities of both a power of attorney for property and power of attorney for health and healthcare.
If you've been named as a power of attorney, you might be wondering what responsibilities come with the role. Whether you're appointed for property or healthcare, you'll have legal authority to make crucial decisions on behalf of the person who made the document, often called the 'grantor' or 'donor.'
For property, this means managing finances and investments; for healthcare, it entails making medical decisions. These roles can have different names depending on where you are in Canada. Here is a breakdown on power of attorney by province.
When choosing a power of attorney, it’s essential to consider the qualities that make a good attorney. You can read our tips for choosing the right person in our article “The Most Important Roles For Estate Planning: Who To Choose?”
Why Would Someone Appoint Me As A Power of Attorney?
If you’ve been chosen as a power of attorney for property (in this situation, attorney does not refer to a lawyer), the maker of the document is trusting you to represent them in the event they are incapacitated, specifically for property, legal, and financial decisions. A power of attorney for property is a legal document that gives someone you trust the ability to make decisions on their behalf.
If you’ve been chosen as a power of attorney for healthcare, the maker of the document is trusting you to represent them in the event they are incapacitated. A power of attorney for healthcare is a legal document that gives someone you trust the ability to make healthcare decisions on their behalf.
In either case, the grantor has likely made this decision based on their relationship with you, your ability to make critical decisions, and their wishes.
What Are the Responsibilities & Duties of a Power of Attorney
A power of attorney’s duties and responsibilities will differ depending on whether you’ve been named as a power of attorney for property or healthcare. If you’re named a power of attorney for property, you're tasked with handling the grantor's financial affairs, which may include paying bills, managing investments, and overseeing bank accounts. In more complex situations, you might also be responsible for managing real estate properties, executing business decisions, and even filing taxes on behalf of the grantor. The overarching aim is to make sure the grantor's assets are well-managed and secure, especially if the grantor becomes unable to make such decisions due to mental incapacity or other reasons.
On the other hand, if you're designated as a power of attorney for healthcare, your role is much more focused on the grantor's well-being. You're generally responsible for making medical decisions when the grantor cannot do so. This could include deciding on treatments, choosing healthcare providers, and even making end-of-life decisions if necessary. You're essentially the voice of the grantor in healthcare settings, and your primary responsibility is to act in their best interest medically, following any guidelines or wishes they've previously laid out.
So, while both roles need a significant level of trust and responsibility, they differ significantly in scope and the kinds of decisions you'll make.
What Are the Responsibilities of a Power of Attorney for Property?
As an attorney for property, your responsibility is to manage the property and financial affairs of the grantor on their behalf. This often includes tasks such as:
- Paying bills
- Maintaining property
- Collecting any debts owed
- Applying for benefits
- Selling/rent/renovate property (if necessary)
Note that the ability to care for someone else’ dependants is not granted by power of attorney documents, but may be able to support dependants by stepping into the shoes of the grantor by paying for schooling or activities if that was something that was done prior to incapacitation.
What Are the Responsibilities of a Power of Attorney for Healthcare?
As an attorney for healthcare, your responsibility is to make decisions related to the health and personal care of the grantor. This often includes decisions such as:
- Life Support
Each individual may have their own wishes for their attorneys or representatives. If you know ahead of time that you’ve been nominated, it’s important to discuss these wishes with the maker of the document. This way, you can feel educated and confident to take on the responsibilities in the event of you need to step into the role.
For healthcare decisions, these wishes are often also outlined in the power of attorney document or in a separate advance health care directive. (You may know this as a living will.) This document is legally binding and you must follow the wishes outlined in the POA.
What Are the Limitations of a Power of Attorney?
Unless you specify otherwise in your Power of Attorney documents, your attorney can do nearly everything that you could do as it relates to managing your finances and property or making decisions about your healthcare. It’s important to note that your attorney does not become the owner of your property or assets, including bank accounts. Your power of attorney cannot:
- Make a will for you, or change your existing will in any way
- Update the beneficiaries named on your life insurance plan
- Assign a new power of attorney to someone else on your behalf
- Make decisions on your behalf after death
Frequently Asked Questions About Power Of Attorney Responsibilities
When Does Power Of Attorney Come Into Effect?
Power of attorney comes into effect when the grantor or maker of the document becomes infirm, unable to communicate, or otherwise mentally incapable. This can happen for many reasons, including after accidents or medical emergencies.
Power of attorney is a legal document that you hope never has to come into effect and for many people it never does. An attorney nominated in a POA maintains their power to act until the grantor becomes mentally capable again or passes away. If they pass away, a will then comes into effect.
If a power of attorney is never selected, a family member would need to apply to become a court-appointed guardian to take on a similar role.
Do I Have To Accept The Role Of Power of Attorney?
No – even if you’re named as an attorney on a POA, you do not need to accept the role if you are unable or unwilling. This can be a large responsibility and requires you to make many critical decisions, so you should be confident in your decision if you decide to take on the role.
However, if someone lets you know that they would like to name you as their attorney or representative, it’s important to let them know if you are uncomfortable with the role sooner rather than later. This way they can choose another person and update their documents accordingly.
If the grantor has created their documents with Willful, they will likely also have picked a backup – just in case!
How Much Does a Power of Attorney Get Paid?
In some provinces, the person you choose as your attorney might have the right to get paid, unless stated otherwise in the power of attorney documents. It's always a good idea to discuss this topic with the person you pick as your attorney and include this information in your power of attorney document.
Who Can Override a Power of Attorney?
The grantor can override a power of attorney if they have the mental capacity. It's also possible for someone to challenge a power of attorney.
Prepare a Power of Attorney With Willful
Securing a Power of Attorney is like giving yourself a safety net for life's unpredictable moments. It ensures that someone you trust takes the reins on your personal and financial matters when you can't. Skip the stress of leaving your family guessing— create your legal Power of Attorney online now.