By the Legal Education Society of Alberta
You are appointed as an Attorney under an Enduring Power of Attorney [EPA]. This position brings great responsibilities. An Attorney named in an EPA is not a lawyer; “Attorney” refers to the person that is appointed in a Power of Attorney.
You have a fiduciary duty to the person who appointed you in his or her EPA, called the Donor. That is, you are like a Trustee and you hold the Donor’s property in trust for him or her. You must:
- act in the Donor’s best interests,
- keep the Donor’s property safe,
- only use the Donor’s property for his or her benefit unless the Donor has given you the specific authority to use his or her property for someone else’s benefit as well,
- not take any benefit from the Donor’s property for yourself.
Usually, an Attorney’s authority in an EPA is unlimited. But sometimes the Donor puts limits in the EPA and restricts what you, the Attorney, may or may not do with the Donor’s property.
You must read the EPA very carefully to ensure that you understand what authority the Donor gives to you and what authority is withheld from you.
As an Attorney, you are entitled to be paid a reasonable fee (which is taxable income in your hands) for acting in this capacity. There is no set fee (sometimes called a tariff), but the fee is often comparable to fees awarded to trustees who act in the estate of a deceased person.
What follows is a list of some of your duties. This list is not exhaustive. The nature of a Donor’s property may require you to do more than what is indicated in this list. Some things in the list may not apply in your situation.
Initial duties
- Review the EPA’s provisions.
- Note whether or not the Donor specifies that funds can be used to benefit others, such as a spouse, dependent children, or charitable groups.
- Note what must be done to bring the EPA into effect.
- Some EPAs are effective on the date they are signed. However, most come into effect only when the Donor loses mental capacity. In that case, a letter is required, indicating that the triggering event (the Donor’s incapacity) has occurred. The Donor may have specified who is to make this decision. If that is not the case, two medical practitioners must make it
- Advise all financial institutions with whom the Donor deals that the EPA is in effect and that you are the appointed Attorney. Provide a notarized copy of the EPA to the banks or other financial institutions. Transfer the Donor’s bank accounts into your name as Attorney for the Donor.
- Register the EPA against the Donor’s title to any real property (land). The Land Titles Office requires an original EPA (which they keep). If the EPA is not effective immediately on signing (i.e., if it is a “springing EPA”), you need a notarized copy of the letter that indicates the EPA is now in effect. (See paragraph 3.)
- List all of the Donor’s property with current market values.
- Ensure that real property (land and houses, commercial and farm buildings, etc.) are adequately insured. Notify the insurance company that you are acting as Attorney.
- Ensure that other property (cars, boats, farm machinery, etc.) is adequately insured. Notify the insurance company that you are acting as Attorney.
- Determine all of the Donor’s debts and arrange for payment.
- Arrange for the payment of recurring debts, such as nursing home fees, utilities, phone, etc.
- Determine the monthly payment to the Donor required for his or her living expenses.
- Arrange to receive the Donor’s mail.
- Arrange to list the contents of any safety deposit box.
- Obtain a copy of the Donor’s will. Note the Donor’s intentions about his or her property in his or her will and ensure that his or her wishes are carried out as far as possible.
Investment duties:
- Invest the Donor’s funds in accordance with the prudent investor rule or any other instructions given to you by the Donor in the EPA.
- Consider what kind of investments are the best according to the Donor’s needs (e.g., need for income or invest for capital growth).
- Engage an investment counsellor if necessary.
- Review the investment portfolio on a regular basis.
- Consider whether to sell or rent any real property.
- Consider whether to sell or continue to operate any on-going businesses.
Accounting duties:
- Keep a record of all financial transactions you make on the Donor’s behalf.
- When you start to act as Attorney:
- prepare an inventory of the Donor’s property and debts at that date at current market values,
- keep a record of all income and other payments you receive for the Donor—including the amount and date of receipt,
- keep a record of all payments you make to the Donor and other parties—including the amount and date of payment,
- keep a record of all investments made by you for the Donor.
- Provide an accounting to any people to whom you are required to account to according to the EPA (if any). You may consider accounting to the Donor’s beneficiaries in any case, whether or not you are required to do so. It is very difficult for beneficiaries to later cause difficulties about the period of your Attorneyship if you keep them advised throughout.
- File annual tax returns with CRA and pay any assessed taxes.
- Engage an accountant if necessary.
On the Donor’s death:
- Account to the Donor’s executor, named in his or her will.
