On January 24, 2024, I attended the Annotated Powers of Attorney for Property and for Personal Care 2024 CPD program hosted by the Law Society of Ontario. The program discussed issues faced by both estate planners and litigators in power of attorney disputes, while providing valuable insights into avoiding those same issues. Below are some of my key takeaways from the sessions.

General Updates:

• “Grantor not Donor”: the name of the person giving the power of attorney (“POA”) has been changed from “Donor” to “Grantor,” which can be important when trying to distinguish between a POA granted under the Substitute Decisions Act (“SDA”) and one granted under the Powers of Attorney Act (“POAA”);
• Continuing Power of Attorney (“CPOAP”): will be terminated by, among other things, the execution of a new CPOAP, unless the Grantor provides that there shall be multiple CPOAPs [see SDA s. 12(1)(d)].

Issues Relating to Powers of Attorney for Property:

• Delayed effectiveness clauses: effectiveness of a POA occurring upon a specific event (i.e. upon a finding of incapacity), be mindful of delay in getting capacity assessments and reports affecting the ability of an Attorney to act, could lose time as a result;
• Capacity: wording must be clear regarding the effect of capacity as capacity is fluid, if specifying the effectiveness of POA upon incapacity then consider what happens if the Grantor loses then regains capacity at a later time;
• POA effectiveness upon a finding of incapacity: Grantors often request springing of effectiveness clause in POA upon a finding of incapacity when the lawyer explains that an Attorney can act even when the Grantor maintains capacity;
• Compensation/expenses reimbursed from Grantor property: Attorney is held to a higher standard if compensation is taken, if no compensation is taken then held to the standard of an ordinary person (SDA s. 33);
• If Grantor has U.S. property: should seek legal advice from a lawyer in the specific jurisdiction, often Canadian POAs not accepted by U.S.; and,
• If Attorney relocates outside of Ontario: be mindful of adverse tax consequences, certainly additional tax requirements, need to report to the IRS and CRA.

Issues Relating to Powers of Attorney for Personal Care:

• Joint Appointments:
  • No legal restrictions on the number of Attorneys a Grantor can appoint;
  • If joint, Attorneys need to act jointly/unanimously unless the POA states otherwise;
  • If more than two Attorneys appointed, and if death/incapacity/resignation of one Attorney, the remaining Attorneys can still act but the planning lawyer should discuss with the Grantor what should happen in that instance;
• Joint and Several Appointments:
  • Majority rules clause:
    • Could include a majority rules clause to prevent a deadlock, provide a mechanism for dispute resolution;
    • Be mindful of using the word “must” in the clause,  rather simplify that any two of three Attorneys can exercise power;
    • Unclear how healthcare practitioners and institutions will respond to such a clause, no available case law yet;
    • Could include a tiebreaker clause stating a specific Attorney’s vote breaks the tie; and,
    • Could include a mediation/arbitration clause.
• Compensation:
  • Additional Challenges with Attorneys for Personal Care:
    • Difficult in proving what work was done, detailed and specific records should be kept; and,
    • Process of determining the appropriate amount of compensation is expensive and difficult.
  • POA should be clear regarding the Attorney’s right to compensation and the quantum of compensation (hourly rate, taken at specific intervals, etc.).

Thanks for reading!

Shawnee Matinnia