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Wednesday, October 21, 2009

What does my Enduring Power of Attorney allow my named representative to do?

I find that clients, whether attending a seminar or meeting with me one-on-one, have a lot of questions about Enduring Powers of Attorney. These documents are not as well known as wills are, so it isn't surprising that people haven't heard or read as much about them.

The person who you appoint as your spokesperson and decision-maker under your Enduring Power of Attorney (EPA) is called your "attorney". That alone causes confusion as those of us who have watched our share of American television are used to the fact that Americans call lawyers "attorneys". Here in Canada the word has a different usage.

Your EPA may be drafted with each and every power and authority for your attorney spelled out. Some don't specify much at all. But every EPA will contain a statement that your attorney can do anything that you can legally do by attorney with your own property and money. People often accept that statement but when we sit down and talk about how those powers could apply to them, they are taken aback by how much authority it really is.

Here are some of the things your attorney could do - legally - with your property once your EPA is in effect and he or she is acting as your attorney:
  • sell, mortgage or rent out your home or cottage
  • deposit or cash cheques made out to you
  • sell your vehicle, motor home, art collection, boat or jewelry
  • run your business, including hiring and firing employees
  • move your investments into other investments of their choice
And of course there are many more as well.

There are restrictions imposed on attorneys by law, but my experience has been that many attorneys don't know what they are and are flying blind. If you have had your EPA prepared by an estate specialist, you may have received a letter or other written material telling you the do's and don'ts of being an attorney. Unfortunately not all lawyers offer that kind of assistance.

As you go through the estate planning process, put some careful thought into who you are choosing as your attorney as you are handing over complete control of everything you own.

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