Do I need a Personal Directive & Enduring Power of Attorney?
Unlike a Will, which takes effect after you pass away, a personal directive and an enduring power of attorney guide personal and financial decisions that are made on your behalf while you are still living, but mentally incapable of making decisions on your own. Both are legally binding documents and are good in both short and long-term scenarios. Both documents are also essential elements in estate planning.
Planning ahead is the smart thing to do. Most of us believe that in the event that we are unable to make decisions for ourselves that our spouse or family will automatically be able to assist us. However, this is not necessarily true, and why we believe every Albertan who is 18 years of age or older should have these documents. If you have an accident or become ill, and lose your capacity to give instructions then these documents are crucial.
If you do not have a personal directive or an enduring power of attorney in place, a friend or family member may have to apply to court to become your guardian or trustee. This process is inconvenient, expensive and takes time. Further, the person that has priority to apply to be your guardian may not be the person whom you would have appointed or wanted to make decisions for you. Additionally, depending on how you have your financial affairs set up, mental incapacity could make it virtually impossible for your family or friends to deal with the simplest of tasks such as paying a bill. As such under the Laws in Alberta, you can plan in advance and appoint another person or persons to act on your behalf should you ever become mentally incapable of making decisions for yourself.
A Personal Directive allows you to name someone you trust to make decisions relating to your personal and health care matters, should you lose the mental capacity to do so. The person you appoint to make those decisions is known as your Agent. It is advisable to appoint an alternate Agent to act, should your Agent predecease you, or for any reason be unwilling or unable to carry out the appointed duties.
The Personal Directives Act sets out the decisions which an Agent can make on your behalf, and may include instructions regarding end-of-life scenarios. You can of course restrict the powers of your Agent to the specific powers you choose, or you can authorize your Agent to make all such decisions on your behalf.
Your appointed Agent must be 18 years of age, and must be mentally capable to make the necessary decisions on your behalf. Typically spouses name each other as Agent, but you may name an adult child, other family member or friend. It is extremely important that whomever you appoint is willing to assume the role as your Agent, should the situation arise.
Additionally, if you choose to appoint more than one Agent, you can specify whether they are to make decisions jointly, or solely if one of them becomes unwilling or unable to act.
If your personal directive comes into effect, and your condition improves so that you regain the ability to make decisions for yourself, your Agent’s authority to make decisions ceases.
Enduring Power of Attorney
An Enduring Power of Attorney continues beyond incapacity. An enduring power of attorney allows you to name someone you trust to make decisions relating to your financial and legal matters, should you lose the mental capacity to do so. The person you appoint to make those decisions is known as your Attorney. Your Attorney will have very wide powers such as, the authority to sell real estate, obtain information from CRA, or make gifts to your children. Similar to a personal directive, you may appoint someone you wish to be your Attorney such as a family member or trusted friend. As well it is advisable to appoint an alternate Attorney to act, should your Attorney predecease you, or for any reason be unwilling or unable to carry out the appointed duties.
Again similar to a personal directive, your appointed Attorney must be 18 years of age, be mentally capable of making the necessary decisions on your behalf, know that they are named as your Attorney and have consented to assume the role should the situation arise.
An enduring power of attorney typically indicates how incapacity is to be determined. However, if it does not, or the triggering event cannot be met for whatever reason, the provisions of the legislation will govern the matter, and the written declaration of two medical practitioners will be required.
Keep in mind that generally speaking the majority of people appoint the same person for both the personal directive and enduring power of attorney, however this is not required. The documents are to work in tandem, and in some instances it can preferable to name a different person for each document.
Both a personal directive and an enduring power of attorney can be cancelled at any time as long as the maker has the mental capacity to do so.
If you need help with your estate planning contact the lawyers at Don Scott McMurray Law Office at 780 750 9888.