Why you Need a Power of Attorney

Why you Need a Power of Attorney

Having up-to-date powers of attorney in place is an important part of estate planning. Let’s consider what happens if you should become incompetent or incapable at some point in the future—without having powers of attorney in place.

In Ontario, no one has the right to make decisions for you. Contrary to a common assumption, even if you are legally married, your spouse is not your de facto decisionmaker in the event of your incapacity. Similarly, you do not have the automatic right to act on behalf of children or even incapable parents.

One requires either a power of attorney or a court order in order to be able to legally act on behalf of another individual. Of course, a power of attorney can’t be given by anyone who is incapable so it is something that must be already in place if needed.

As an example, many spouses who own their family home jointly are surprised to learn that they would be unable to refinance or sell their home in the event one spouse was incapable and unable to sign the necessary legal forms, unless the authority to act was already granted in a power of attorney.

I recall a case I had several years ago involving an elderly couple. Following an accident, the wife was unable to give her consent to the sale of the family home which the husband intended to sell in order to downsize. While I was able to obtain a court order for the husband allowing him to sell the home, this delayed things and resulted in some additional costs.

So it’s best to take care of things like having powers of attorney in place before there is an issue. Thanks for reading,

Jason

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