Duties of a Property Power of Attorney

A Property Power of Attorney is a crucial legal tool that enables an individual, known as the Attorney, to act on behalf of another person, referred to as the grantor. This document is designed to grant the Attorney the authority to make decisions and manage the grantor’s financial affairs when they are unable to do so themselves.

As an Attorney, it is paramount to understand the significance and seriousness of the role. The Attorney essentially steps into the shoes of the grantor, and with this role comes a great deal of responsibility. Acting diligently and sensitively is crucial, as the decisions made by the Attorney can significantly impact the grantor’s life and well-being.

The Attorney is held to the highest standards of honesty, integrity, and trust. It is essential to act honestly and in good faith, always keeping the best interests of the grantor in mind. Furthermore, the Attorney must exercise the care and skill that could reasonably be expected of a person with their experience and expertise.

It is important to note that while the Attorney assumes control of the grantor’s income and assets, they do not become the owner of these assets. Ownership remains with the grantor, and the Attorney is responsible for managing them in a manner that is in the best interests of the grantor.

Powers of an Attorney

The powers granted to an Attorney are outlined in the Power of Attorney document. Unless restricted by the document, an Attorney has broad powers to act on behalf of the grantor in relation to their property and financial affairs. These powers include but are not limited to, opening and closing bank accounts, redirecting pensions and other income, applying for benefits, choosing pension options, dealing with investments, collecting debts, paying bills, filing income tax returns, buying goods and services, starting or defending lawsuits, selling or disposing of personal belongings, and maintaining or selling a house or vehicle. However, an Attorney cannot make or change an existing will.
It is important for Attorneys to understand the extent of their powers and to exercise them responsibly and in accordance with the grantor’s wishes.

Accounting

Attorneys are required to keep careful records of all transactions involving the grantor’s property. This includes maintaining a list of all assets and liabilities, as well as detailed records of all financial transactions conducted on behalf of the grantor. These records must be accurate, up-to-date, and available for inspection if required or whenever the grantor asks.
It is also a good idea to keep copies of invoices and bills you have paid on the person’s behalf, cancelled cheques you have written on the grantor’s behalf, and copies of cheques you received to the grantor’s benefit. You should retain the accounts and records until you no longer are acting as Attorney and either the Courts have approved your accounts, or you have been provided with a release signed by the grantor or a legal representative of the grantor.

Effective Date

Unless otherwise specified, the powers granted to a Property Power of Attorney come into effect immediately upon the document being executed. However, suppose the document specifies that it only comes into effect upon the grantor’s lack of capacity. In that case, two qualified healthcare professionals will have to each do independent assessments of the grantor and declare in writing that the grantor is incompetent before the authority in the Power of Attorney is triggered.

Compensation

Attorneys may be entitled to compensation for their services. If the Power of Attorney document does not authorize this compensation, then the compensation is limited to the amount authorized by law, which is 2.5% of the money received each month by the Attorney and 2.5% of payments made each month by the Attorney on behalf of the grantor for dealing with property and financial matters.
If there is more than one Attorney, the fees should be divided equally unless otherwise agreed or determined by the court.

Termination of Authority

A grantor can terminate a Power of Attorney at any time or it will be automatically terminated on the death of the grantor.
Regardless, a final accounting must be provided within six months of termination of an Attorney’s authority (such as when the power of Attorney is revoked, or when the grantor passes away), except for when the Attorney is also the sole beneficiary of the grantor’s estate.

Disclaimer: This Blog is intended to provide readers with general information. Each client’s circumstances and legal solutions might vary. For further details, please reach out to us to learn more.