What is an Enduring Power of Attorney?

What is an Enduring Power of Attorney?

General Information about Enduring Powers of Attorney

What is an Enduring Power of Attorney?

An Enduring Power of Attorney, (EPA) is a written, signed, dated and witnessed document that gives someone else the right, while you are still alive, to act on your behalf with respect to your financial affairs. This can include paying bills, depositing and investing money on your behalf, and even selling your house, if your document gives this power.

A Power of Attorney does not give someone authority to make decisions about your health care – for that, you need a separate document, called a Personal Directive.

When you make an Enduring Power of Attorney, you are the “Donor” and you give your authority (“Power”) to another person (“Attorney”) to deal with your financial affairs. Your Enduring Power of Attorney:

  • may take effect immediately once it is signed and will continue even if you lose your mental capacity in the future; or
  • may take effect at some time in the future, when an event you specify occurs, usually your loss of mental capacity. This second kind of Enduring Power of Attorney is sometimes called a “springing” power of attorney, because it “springs” into effect when a specific event happens.
  • In Alberta, the law that creates Enduring Powers of Attorney is called the Powers of Attorney Act.

An Enduring Power of Attorney must state whether it is to take effect immediately and continue upon your mental incapacity, or only spring into effect upon your future mental incapacity, infirmity or some other event that you name. If it does not include such a statement, it is not an Enduring Power of Attorney and it cannot be used once you no longer have mental capacity.

What is “Mental Capacity”

Mental capacity means the ability to understand information that is relevant to making a decision and the ability to appreciate the reasonably foreseeable consequences of the decision.

Why should I make an Enduring Power of Attorney?

You should have an Enduring Power of Attorney because if you suffer a serious accident or illness, you may become incapable of deciding financial matters for yourself (this is called mental incapacity or infirmity). In this event, you authorize someone to act for you and your best interests in conducting your financial and property matters.

By preparing an Enduring Power of Attorney now, while you have mental capacity, you can ensure that your property is managed by someone who knows you and what you want, someone you trust to act in your best interests when you cannot make decisions for yourself. It is a simple and inexpensive way to plan ahead.

If you do not prepare an Enduring Power of Attorney you do not get to choose who
will look after your financial affairs if you lose mental capacity.

What happens if I don’t make an Enduring Power of Attorney?

If you do not prepare an Enduring Power of Attorney you do not get to choose who will look after your financial affairs if you lose mental capacity. An interested party such as a family member or friend will have to apply under the Alberta Adult Guardianship and Trusteeship Act to become “trustee” of your property (this is called a “Trusteeship” application).

This court process can take several months, be costly, might result in disagreements among your family members and friends, and might result in authority being given to someone whom you might not have chosen.

Is an Enduring Power of Attorney effective outside of Alberta?

It depends on the law of the particular place where you want to use your Enduring Power of Attorney. If you are going to move or be out of the province for some time, you may want to check with a local lawyer where you are going to see if you need to make new documents, or if you can just make an addition to your existing EPA. For example, some countries just require an additional notarized document created by a lawyer.

Can my bank refuse to recognize my Enduring Power of Attorney?

As long as your Enduring Power of Attorney appears to be properly completed and witnessed and the bank has no reason to suspect that it is invalid, it would have no legal right to refuse it. But it is wise to give your bank a copy of your Enduring Power of Attorney to put on file. If a bank refuses to recognize your Enduring Power of Attorney, speak to the manager and, if necessary, contact a lawyer.

If someone else has evidence suggesting mismanagement or theft and believes that you are mentally  incapable, they may ask the court to review the accounts and records your Attorney is required to keep.

What if I, or someone else, discover that my Attorney is mismanaging or stealing my money?

If you still have mental capacity, you may elect to revoke your Endu
ring Power of Attorney, demand a full accounting and consider making a claim for any lost funds.

If someone else has evidence suggesting mismanagement or theft and believes that you are mentally incapable, they may ask the court to review the accounts and records your Attorney is required to keep. This process is called a “passing of accounts”. They may also report the matter to the Public Trustee for Alberta. This office investigates allegations involving a mentally incapable person who is believed to be at serious financial risk.

Can an Enduring Power of Attorney be challenged?

Yes. Any interested person may apply to the court to:

  • question the capacity of the Donor or Attorney;
  • determine the validity of an Enduring Power of Attorney, or part of it;
  • change, confirm or cancel a decision made by an Attorney;
  • determine the authority of an Attorney to provide advice and directions;
  • make a decision if the Attorneys cannot agree;
  • delay the decisions of an Attorney; or
  • make any other order that the court considers appropriate.

The Powers of Attorney Act does not define who an ‘interested person’ is. The Court has the power to decide. The person will need to have some connection to the case.

Can I change my mind after I have made an Enduring Power of Attorney?

As long as you have mental capacity, you may revoke your Enduring Power of Attorney by telling your Attorney that it is revoked. It is best to advise your Attorney in writing. You should also inform everyone that is involved with your income or property. To do so, you should state in writing that you are “revoking” your Enduring Power of Attorney. There is no special form for this statement, which is referred to as a “revocation”, but it must be signed and witnessed, the same way as your Enduring Power of Attorney.

If you fail to inform everyone that is involved with your financial affairs, a court might deem it reasonable for third parties to rely upon the Enduring Power of Attorney being in force, and, as a result, you may still be bound by the acts of your Attorney (although your Attorney would be liable for harm cause by such unauthorized acts).

If you own a home or other real estate, you may wish to consider having a lawyer register notice of the revocation on title to prevent any unauthorized dealings. It is also a good idea to get the original (and now revoked) Power of Attorney back from your Attorney and destroy it.

If you own a home or other real estate, you may wish to consider having a lawyer register notice of the revocation on title to prevent any unauthorized dealings.

How long does an Enduring Power of Attorney last?

An Enduring Power of Attorney lasts until:

  • you die;
  • you revoke it (if you still have mental capacity);
  • you recover sufficiently from mental incapacity or infirmity to resume control of your own affairs;
  • a court determines that the Enduring Power of Attorney ceases to have effect; or
  • your Attorney dies or quits and there is no Alternate Attorney to take over.

As long as you have mental capacity, you may revoke your Enduring Power of Attorney by telling your Attorney it is revoked.

You should NOT rely on this webpage for legal advice. It provides general information on Alberta law only. December 2016.
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