• substitute decision-maker to make healthcare decisions on their behalf if they are incapable of doing so themself. 
• Retirement Plans and Insurance Contracts which allow an individual to designate a beneficiary to receive the proceeds of certain funds after their passing. 
• Inter Vivos Trusts which allows an individual to gift an asset, or allow someone else to handle an asset, during the individual’s lifetime.

A Guide to Powers of Attorney in Ontario

Clients are often surprised by the range of estate planning tools available. Aside from creating a will to distribute property after your passing, there is other documentation that you should consider preparing, such as a power of attorney. Having a valid power of attorney in your estate plan will allow others to make decisions on your behalf if something happens and you cannot do so yourself.

In a recent blog post, we briefly discussed powers of attorney. This blog post will dive further into the world of powers of attorney in Ontario, providing detailed explanations as to what they are, what types are available, and how they can benefit your estate plan.

What is a Power of Attorney?

A power of attorney is a legal document that grants another person (the “attorney”) the authority to manage your money and property on your behalf during your lifetime.

A power of attorney is typically used in cases where an individual wants to ensure that a trusted person or organization can manage their affairs in the event that they become unable to do so themselves. Generally, the appointed attorney will step in if the individual lacks the physical or mental capacity to manage their affairs themselves.

Types of Powers of Attorney in Ontario

Attorneys have different powers depending on the specific type of power of attorney created; therefore, it is important to have a sound understanding of the different options that are available before preparing the document. Working with an experienced estate planning lawyer will also allow you to ensure that your questions are answered and that you have sufficient information to decide on the best power of attorney for your circumstances.

Some of the common types of powers of attorney are explored in further detail below.

A power of attorney for property will make decisions relating to finances and physical property on your behalf. For example, depending on how a power of attorney is drafted, a power of attorney for property may be able to:

• pay your bills for you;
• manage your finances (including investments); and
• manage and sell your property.

Power of Attorney for Personal Care

A power of attorney for personal care will allow your appointed attorney to make decisions relating to your personal care and welfare. This could include decisions relating to your health care, living arrangements, meals and clothing.

Duration of a Power of Attorney

Beyond choosing the specific types of decisions you want your attorney to make, you can also specify the period of time during which the power of attorney will be effective.

Non-Continuing Powers of Attorney

Non-continuing powers of attorney are valid so long as the individual granting the power is mentally capable of managing their affairs. Non-continuing powers of attorney are often used in cases where the grantor is physically incapable of making decisions (for example, if the grantor lives in one area but requires help managing their affairs in another area).

Enduring Powers of Attorney

Enduring powers of attorney are valid even when the grantor becomes mentally incapable of managing their affairs. In some cases, grantors may specify that an enduring power of attorney only becomes effective when they become mentally incapable of managing their own affairs.

Limited Powers of Attorney

Limited powers of attorney are just that—limited to particular durations or particular scenarios. For example, if a grantor intends to sell a property but will not be physically present during the transaction, they can create a limited power of attorney granting their attorney authority to act on the grantor’s behalf with respect to the sale.

Choosing an Attorney in Ontario

In addition to the type of power of attorney you decide to prepare, it is also important to think about who you plan to appoint as your attorney. Given the significant amount of power granted to an attorney, it is critical to choose a trusted individual or organization and to make them aware of your intentions to appoint them as the attorney beforehand.

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