About Your Power of Attorney for Property – Top 10 Things to Know

About Your Power of Attorney for Property – Top 10 Things to Know

Posted July 29, 2016 Category: Businesses

If you have written your will within the past 10 or so years, chances are you have also completed your power of attorney for property documents.  In a previous blog I wrote about powers of attorney for personal care and substitute decision making for health care matters and so this blog is dedicated to the top ten considerations you should make while and after completing your power of attorney for property documents.

While it is one thing to write a will to plan for the distribution of your estate to your loved ones on your death, it is quite another to plan for your potential incapacity or disability using power of attorney documents.  A will is effective only on your death, but a power of attorney document is effective only during your lifetime, meaning that it may become a more important tool for your personal well-being than your will.

The most common form of power of attorney for property is called a “continuing power of attorney” (CPOA) and it is effective the moment it is properly executed.  It gives your appointed attorney the same power to manage your property as you have now.

This means that an attorney for property may open and close your bank accounts, redirect your pensions and other income, choose your pension options, deal with your investments, collect your debts, pay your bills, select and pay for your goods and services, start or defend law suits if there are financial implications, lend, sell, store or dispose of your personal belongings, maintain or sell your house or vehicle, obtain information about your property from any person or business, give gifts to individuals or organizations, and access your safety deposit box.

Things to consider:

  1. Appoint Someone You Trust.  Your attorneys will have complete stewardship of your property.  If you have no close relatives living in your area, and you have sufficient resources, you may want to consider appointing a trust company.
  2. Make Your Document an Expression of Your Wishes containing all of the right elements.  Does it specify that the document can be used in the event of your incapacity to manage property?  It should say when and how the document comes into effect.  It may either expand or restrict the powers that are given by law to attorneys. It should address the issue of attorney compensation.  Have you named a primary attorney and an alternate in case the primary attorney cannot act on your behalf?  Like wills, power of attorney documents have become more complex, embracing all manner of property issues so be sure you have a properly drafted document.
  3. Talk to Your Attorney while you still can.  Tell your appointed attorneys that you have designated them to manage your property on your behalf.  Give them a copy of the document and let them know where to find the original.
  4. Tell Your Attorney What You Own and Where To Find It.  Tell your attorneys where your assets are held including your bank accounts, pensions, deeds, ownership papers. Tell your attorneys how you own your assets.  Do you own them jointly, as a tenant-in-common, or by yourself?  Do you own foreign property?
  5. Tell Your Attorney How You Would Want to Live if you lost the ability to live independently.  Would you prefer to stay at home?  Have you made arrangements already? Do you have a certain nursing home or certain assisted living residence in mind?  If you have adequate resources, money should be spent to ensure your quality care in whichever manner you choose.  Your attorneys’ primary obligation is to you, not to the beneficiaries of your estate.
  6. Tell Your Attorneys How to Care for Your Dependents, if any.  The attorneys’ secondary responsibility, after caring for your financial well-being, is to honour your financial obligations to dependents, including required expenditures for their maintenance and education.
  7. Tell Your Attorney That You Want to Have A Say in the decisions being made on your behalf, and unless you are completely mentally incapable of making decisions about your property, your attorney has a duty to involve you.  Since capacity is time, situation and task specific, you may be incapable of physically going to the bank but perfectly capable of making all property related decisions.  Or you may be mentally incapable of making decisions such as which mutual funds to purchase, but mentally capable of deciding to give a gift to a loved one or to sell your house.
  8. Show Your Attorney Your Will so that he or she can take care to ensure that gifts bequeathed in your will remain in your estate until your death.  As long as the proceeds of sale are not required for your care, any testamentary gifts should not be sold during your incapacity.  To ensure that your will retains its meaning, you need to show it to your attorney.
  9. Choose Attorneys for Property and Personal Care That Get Along so that they can work together harmoniously on your behalf.  Some people think it will encourage family bonding by appointing siblings may have a checkered past, but this is a poor time to conduct a social experiment.  Attorneys in conflict will detract from your care and well-being and potentially become a financial drain on your estate.
  10. Tell Your Attorneys to Keep Meticulous Records of all of the transactions that they conduct from the date of the first transaction until they cease to act as your property attorney, and that the record keeping is for their own protection.   Explain to your attorneys that they may be called to account by your attorney for personal care, your dependents, or a number of other interested parties.

Finally, advising your attorney to seek advice and clarity from an experienced estates lawyer once they are called upon to act is always a good rule of thumb which will help protect you and your attorney.

Posted July 29, 2016 Category: Businesses

Newsletter Signup

Sign up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.