A Power of Attorney is utilized by a person (the “grantor”) to appoint (the “attorney”) to manage the grantor’s property. The attorney can do anything in respect of the property, with the following exceptions:

• Cannot make a will for the grantor
• Must make decisions with reasonable care
• Must not act in conflict with the grantor’s interest
• Must not make secret profits
• Must not make decisions conflicting with the will of the grantor, unless expressed in the Power of Attorney document

Evidently, the grantor can limit the scope of authority granted to the attorney by expressly providing this in the Power of Attorney document. The grantor can restrict the type of property or the timing of the attorney’s authority taking effect. For example, the grantor can specify that the Power of Attorney becomes effective only when the grantor becomes mentally incapable.

There are two situations in which to have a Power of Attorney:

1. The grantor is incapable to manage property (Power of Attorney for Property)
2. The grantor is unavailable to make decisions (e.g. out of the jurisdiction)

Where there is no Power of Attorney, it is much more difficult and expensive to have a substitute decision-maker. There is also unpredictability regarding the person who will ultimately make all property decisions. Furthermore, it is of utmost importance to have a properly drafted Power of Attorney: the grantor requires legal advice to ensure the document meets its intended purpose; the attorney requires legal advice to ensure he/she meets all legal obligations inclusive of proper care, accounting responsibilities, fiduciary duties, and limit of decision- making. Finally, the Substitute Decisions Act, 1992 governs substitute decision-making and, in the absence of a Power of Attorney, the default provisions may not reflect the desires of the grantor.

**The content on this website is not legal advice.