An Enduring Power of Attorney is a legal document which appoints one or more persons to manage financial affairs on your behalf. It becomes effective on the date it is signed and remains in effect if you become incapacitated. The person making a Power of Attorney is the “donor” and the appointee is the “attorney.” An attorney acting on behalf of a donor can pay the donor’s bills, manage bank accounts and investments and deal with real and personal property. The attorney must keep the donor’s property separate from his or her own property.
The Power of Attorney Act in B.C. sets out duties of an attorney under section 19 and attorney’s powers under section 20 and in particular states at 19(2):
“When managing and making decisions about the adult’s financial affairs, an attorney must act in the adult’s best interests, taking into account the adult’s current wishes, known beliefs and values, and any directions to the attorney set out in the enduring power of attorney.”
The needs of the donor are paramount and whenever possible, the attorney should involve the donor in decision-making.
Section 20(1) of the Power of Attorney Act states that “an attorney may make a gift or loan, or charitable gift, from the adult’s property if the enduring power of attorney permits the attorney to do so or if (a) the adult will have sufficient property remaining to meet the personal care and health care needs of the adult and the adult’s dependants, and to satisfy the adult’s other legal obligations, if any, (b) the adult, when capable, made gifts or loans, or charitable gifts, of that nature, and (c) the total value of all gifts, loans and charitable gifts in a year is equal to or less than a prescribed value.”
If the donor is no longer capable of managing his or her own affairs the prescribed amount under the Power of Attorney Regulation in any given year is no more than 10% of the donor’s taxable income from the previous year or $5,000, whichever is less.