With Great Power Comes Great Responsibility: Enduring Power of Attorney Instruments and Statutory Duties of Attorneys

It is very common for people to prepare an Enduring Power of Attorney instrument (“EPOA”) as part of their estate plan. This allows an adult to designate an “attorney” to make financial and most legal decisions on behalf of the adult. An EPOA is an extremely helpful tool in the event of a loss of mental capacity and can be used to grant very broad powers to the attorney.

Even where broad powers are granted in an EPOA, BC’s Power of Attorney Act[i] includes certain restrictions on the activities of an attorney. This article highlights some common questions that arise under these provisions of our provincial law.

  1. An attorney has a duty to act honestly and in good faith, and exercise the care, diligence and skill of a reasonably prudent person. This does not mean that the attorney must always be correct and can never make an error, but that the attorney makes appropriate decisions in the circumstances, after considering relevant factors and obtaining any necessary professional advice.
  2. An attorney may only act under the authority granted in the EPOA. The attorney should review the specific EPOA relied upon in detail and determine if it includes any restrictions. Unless otherwise stated in the EPOA, the attorney may only invest the adult’s property in accordance with the Trustee Act[ii].
  3. The attorney is required to keep records and produce these at the adult’s request.
  4. The attorney is required to keep the adult’s property separate from the attorney’s own (with an exception for any pre-existing joint assets).
  5. The attorney may not dispose of any of the adult’s property which the attorney knows is subject to a specific testamentary gift in Will, unless doing so is necessary to comply with attorney’s duties.

When assuming the role of attorney, one should review the EPOA in detail and familiarize oneself with the duties and restrictions set out in the Power of Attorney Act.  If you want to include an EPOA as part of your estate plan, or if you have been appointed as an attorney under an EPOA, we can assist. For further inquiries on this topic, please contact one of our lawyers in our Wills, Estates + Trusts Practice Group.

[i] RSBC 1996, c 370

[ii] RSBC 1996, c 464