Acting as power of attorney has its limits

As our loved ones age, many of us find ourselves stepping into power of attorney roles. Many individuals may take on this role without fully understanding what it entails. I previously penned an article entitled “What is a power of attorney and why should you have one?” * In that article, I explain that a power of attorney is a legal document that you (the “grantor”) sign that gives another person (the “attorney”) the power to manage your affairs. That article provides a good overview of what a power of attorney document is and what a grantor must do to make a valid power of attorney document. In this article, I outline some key considerations for attorneys, in particular, what you cannot do when acting as attorney.

As a starting point, an attorney must exercise their authority honestly, in good faith and in the best interests of the grantor. The power of attorney document is key, because it sets out the attorney’s powers. The attorney must follow the directions set out in the power of attorney document. The list below contains some important limits to keep in mind when acting as attorney. This list is not exhaustive, but provides some key considerations for attorneys to keep in mind:

•An attorney cannot benefit themselves. An attorney is required to act in the grantor’s best interest. This means an attorney cannot use the grantor’s money or other assets to benefit themselves. An attorney also cannot put themselves in a conflict of interest wherein the attorney’s interests conflict with the grantor’s interest. For example, an attorney cannot make a loan or a gift to themselves from the grantor’s property. Also, an attorney cannot transfer the grantor’s assets/property into their own name. Keep in mind that the power of attorney document may permit the attorney to do such things, but this depends on the specific powers set out in the power of attorney document.

•An attorney cannot change the grantor’s estate planning. An attorney cannot make changes to the grantor’s estate planning documents. This means that an attorney cannot, under their own authority, change the grantor’s will, power of attorney or health care directive. This power remains with the grantor, and the grantor alone. An attorney is also not typically permitted to change beneficiary designations for the grantor.

•An attorney cannot make health care decisions for the grantor. As outlined in my previous article, the power of attorney document usually appoints both a “personal attorney” and a “property attorney.” Typically, the same person is appointed in both roles. The personal attorney can make day-to-day care decisions relating to hygiene, housing or social activities, for example. That said, a personal attorney cannot make health care decisions for the grantor. This role is reserved for the health care proxy, appointed under a health care directive, or following the default order set out in The Health Care Directives and Substitute Health Care Decision Makers Act, 2015 (Saskatchewan). Of course, if the attorney and health care proxy are the same person, then that person can make both health care decisions and personal decisions.

•An attorney cannot act after the death of the grantor. An attorney can only act while the grantor is alive. The attorney’s power over the grantor’s affairs terminates when the grantor dies. At this point, the deceased’s executor would step in and deal with the deceased’s estate. However, it is important to remember that the attorney has certain responsibilities to keep track of their activities, and to report to the executor and provide an accounting.

The above should not be taken as a complete list; however, it provides some common examples of limits on acting as attorney. Potentially, your decisions or actions as attorney could be subject to court review. If you are uncertain whether you have the power to do something as an attorney, it is always best to consult a lawyer.

The information in this article is not legal advice. We encourage you to consult with your legal advisor for advice specific to you.

* To read this article, visit www.shtb-law.com/articles/what-is-a-power-of-attorney- and-why-should-you-have-one