Understanding a Power of Attorney
Factors to Consider When Signing Your Power of Attorney
A power of attorney is a legal document that allows a person (the "principal") to appoint another person (the "attorney") to act on their behalf in certain circumstances. This article will provide an overview of the different types of powers of attorney, the legal requirements for witnessing a power of attorney in Nova Scotia, and factors to consider when choosing an attorney.
Types of Powers of Attorney
There are three main types of powers of attorney: general, enduring, and springing.
A general power of attorney gives the attorney the authority to act on the principal's behalf in all matters, unless otherwise specified. This type of power of attorney is often used in situations where the principal will be out of the country or unable to manage their affairs for a period of time.
An enduring power of attorney is similar to a general power of attorney, but it continues to be effective even if the principal becomes mentally incapacitated. This type of power of attorney is often used by older adults or individuals with disabilities to ensure that their affairs will be managed if they are no longer able to do so themselves.
A springing power of attorney only becomes effective if a certain event occurs, such as the principal becoming mentally incapacitated. This type of power of attorney can provide peace of mind for individuals who are concerned about losing control of their affairs due to a sudden illness or injury.
In Nova Scotia, this document must be witnessed by two individuals in order to be valid. These witnesses must be adults who are not named as attorneys in the document. The witnesses must also be present when the principal signs the document and must sign the document themselves.
If it is not properly witnessed, it may be deemed invalid. This could result in the attorney not being able to act on the principal's behalf when it is needed most.
Choosing an Attorney
Choosing the right attorney is an important decision that should not be taken lightly. It is important to select someone who is trustworthy, reliable, and has the necessary skills to manage the principal's affairs. When choosing an attorney, the following factors should be considered:
- Trustworthiness: The attorney should be someone who is honest and can be trusted to act in the best interests of the principal. This is particularly important for enduring powers of attorney, where the attorney will be making decisions on behalf of the principal even if they become mentally incapable.
- Availability: The attorney should be someone who is readily available to manage the principal's affairs when needed. This is particularly important for general powers of attorney, where the attorney will be managing the principal's affairs on an ongoing basis.
- Skills and experience: The attorney should have the necessary skills and experience to manage the principal's affairs. For example, if the principal's affairs involve complex financial matters, the attorney should have knowledge and experience in this area.
- Communication skills: The attorney should be someone who is able to communicate effectively with the principal and other parties involved in managing the principal's affairs. This is particularly important for enduring powers of attorney, where the attorney may need to communicate with medical professionals and other caregivers.
- Willingness to act: The attorney should be someone who is willing to act as the principal's attorney. It is important to discuss this with the person before appointing them as an attorney.
By considering these factors, individuals can choose an attorney who is best suited to manage their affairs and act in their best interests.
Revoking the Power
There may come a time when a principal needs to revoke a power of attorney. This could be due to a change in circumstances, such as a reconciliation with a previously estranged family member, or a loss of trust in the attorney. Whatever the reason, it is important to follow the legal requirements for revoking a power of attorney in order to ensure that it is done properly.
In Nova Scotia, a power of attorney can be revoked at any time as long as the principal has the mental capacity to do so. The revocation must be in writing and signed by the principal, and it must be witnessed by two individuals who are not named as attorneys in the document. The attorney should also be notified in writing that their appointment has been revoked.
Getting a Third Party to accept the Power of Attorney
For the person assigned to act as an attorney, when it comes time to use it you must get others to recognize your authority. Take the Power of Attorney (or a certified true copy) to the third party after making sure that it gives you the power to do what you want to do. Show the document (or copy) and explain to the third party that you are acting under the authority of the Power of Attorney and that it gives you the legal authority to perform this action. Some third parties may request that you sign a form stating that you are accepting liability for your actions.
The third party must accept and allow you to act on behalf of the Principal when you become an Attorney-in-Fact. Always make it clear when signing any paper that you are acting as an Attorney-in-Fact and not for yourself. You should convey this in your signature. You may be personally responsible for what you sign if you just sign your own name. You're fine as long as your signature clearly shows that you're signing on behalf of the firm and not yourself. For example, you might sign it "Sally Brown as attorney for James Langdon" or "Sally Brown acting under power of attorney for James Langdon".
Third parties are sometimes hesitant to follow Powers of Attorney because of a variety of reasons. Nonetheless, third parties must obey the Power of Attorney as long as it was lawfully issued and has not been revoked. A refusal by the third party to adhere to the Power of Attorney might result in liability for any damages caused and even attorney's fees and court costs in some circumstances. Delays may also be costly, especially if they delay treatment or cause damage. Third parties may be sued for monetary compensation if their failure to act results in any loss.
It is reasonable for a third party to have time to consult with legal counsel regarding the Power of Attorney. Banks will frequently submit the Power of Attorney to their legal department for approval. There is a point, however, when delay becomes unacceptable. Contact your lawyer if you are denied or delayed beyond a reasonable period of time.
To third parties, the Power of Attorney you've given them is just a piece of paper with words on it. They don't know if it's genuine or bogus. They don't know if it's still valid. They don't know whether the Principal was competent when the Power of Attorney was signed. They don't know if the Principal is alive or dead.
Third parties are reluctant to accept responsibility if anything goes wrong. Because they feel they are shielding the Principal from possible unscrupulous action, some third parties will not honour Powers of Attorney. Refusal is more prevalent among older ("stale") Power of Attorney, despite the fact that age should have no bearing on them. If your Power of Attorney is rejected, you may need to have a lawyer get in touch with the third party and explain their obligation to recognize your authority.
An affidavit is a formal written statement. A third party may request that you, as the Attorney-in-Fact, sign an affidavit stating that you are lawfully fulfilling your responsibilities under the Power of Attorney. If the third party so requests, you must sign the affidavit to use the Power of Attorney. The purpose of the affidavit is to absolve the third party from responsibility for accepting an invalid Power of Attorney.
A third party, for example a property manager or a bank manager, may be held liable for any damages caused by their refusal to accept your valid authority, as well as legal fees and court costs. In most situations, however, your lawyer's phone call to the third party will resolve the problem. In most situations, once the law has been explained to the third party, the Power of Attorney will be accepted.
A power of attorney is an important legal document that can provide peace of mind and ensure that an individual's affairs are managed in their best interests. It is important to understand the different types of powers of attorney, the legal requirements for witnessing a power of attorney in Nova Scotia, and the factors to consider when choosing an attorney. By taking the time to carefully consider these issues, individuals can ensure that they have a power of attorney that meets their needs and protects their interests.
In summary, a power of attorney is a legal document that grants authority to an appointed attorney to act on behalf of the principal in certain circumstances. The types of powers of attorney include general, enduring, and springing, each with its own unique features. In Nova Scotia, a power of attorney must be witnessed by two individuals who are not named as attorneys in the document. When choosing an attorney, it is important to choose someone who is trustworthy, reliable, and has the necessary skills to manage the principal's affairs. If a power of attorney needs to be revoked, the principal must follow the legal requirements to ensure that it is done properly.
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