Wills, Powers of Attorney, and Health Care Directives
Most people acknowledge that they should have a Will to organize their affairs. Often, the issue of signing a Will comes up at major life turning points, such as having a child, getting divorced, retirement, or getting ill. This group knows they do need a Will, but they don’t always get around to it. Some, a minority, say they don’t need a Will. Usually they say that they are “not worth much,” or that their estate plans are “simple,” or that it’s “all been worked out” and they trust their family to follow their wishes. The truth is that both groups are uncomfortable talking about death and dying.
And both groups are mistaken.
When planning for your affairs, you need more than just a Will. A Will is a written document that controls the disposal of your property after death. Before death (and therefore arguably more important to you), you need a Power of Attorney, and a Health Care Directive. You may also want to consider making a Funeral Plan.
The following chart is an easy way to think about these 4 kinds of documents, and why they matter:
|Health Care Directive
|Power of Attorney
As a lawyer, I am normally involved in the creation and signing of Wills, Powers of Attorney, and Health Care Directives (I can also refer people to a good company for the making of a funeral plan). This letter is intended to provide a short summary of the nature and importance of each of these crucial documents
A Will controls the distribution of your property (your “stuff”) after you die. When preparing your Will, my job is to make sure that the plan is clear and that it will work.
Having a Will is an effective way to ensure that your personal wishes are followed with minimum of expense and delay. It is also an act of kindness and consideration to surviving family members who may already be suffering emotionally. If you die without a Will, the Court will have to appoint an Administrator to settle the Estate. In some cases this person will have to purchase a bond. A bond may cost more than it would have cost to draw up a Will. In contrast, an Executor named in a Will does not have to post a bond unless he or she does not live in Canada.
Your Executor is the person responsible for settling your Estate after your death. Being an Executor can be a difficult job and should be left in the hands of someone capable of performing the required tasks. When selecting an Executor you should always ensure that that individual consents to be appointed, is trustworthy, reliable, and capable of doing the job, and is available to do the work. Often it is best to name a trusted friend or relative. An Executor must be 18 years of age or older. A non-Canadian may be appointed, but may have to provide security in the form of property or an insurance bond. You should also always choose an alternate Executor in case your first choice dies before you or is unable to act.
A Will can be revoked or cancelled as follows:
- By marriage. When someone marries all previous Wills are automatically revoked. This occurs even if the Testator intends the Will to remain the same.
- If you destroy your Will with the intention of revoking it, it is revoked and therefore invalid. Note however that your intention must be clearly known. If a Will is destroyed or lost accidentally, a copy might still be found to be a valid Will.
It is your decision how you distribute your assets in your Will. No one can tell you how do write your Will, and what to do with your estate.
You are not obliged to show your Will to anyone, or to discuss any of your decisions regarding your estate with anyone. That said, it is important that you tell someone that you have a Will and where it can be found. A copy should be made, labelled as a copy and left in an accessible place, such as in your desk or in a filing cabinet. Store the original in a safe place, such as a bank safety deposit box, or at your lawyer’s office. You may also, but are not required to, give your Executor a copy of the Will.
Your general freedom to dispose of your property as you wish is not absolute. A number of laws in Manitoba can affect and limit your ability to direct how your property is distributed. I can go through these limits with you.
You should review your Will every few years to make sure it is current. It is wise to review your Will whenever you move, change marital or common-law status, acquire or lose a substantial amount of property, want to add or remove a beneficiary, or when new laws are passed. You may change your Will as often as you wish. Changes can be made by an addition to the Will, called a Codicil, or by making an entirely new Will.
Your Power of Attorney
A Power of Attorney is a legal document giving someone else power over your legal and financial affairs (your “stuff”).
Although a Power of Attorney can be very broad, it does not allow a person to make health care or other personal decisions for you. For that you will need a Health Care Directive.
An attorney under a Power of Attorney does not have to be a lawyer. Just like when choosing an Executor, the individual you chose to grant Power of Attorney should be a trusted friend or relative. They should be capable of doing the job, available to do the job, and must consent to do the job. It is important to note that when you give someone Power of Attorney, you retain the right to manage your own affairs. You are still free to deal with any property, bank accounts, or investments that are included in the Power of Attorney. But they can also do these things, as if they were you.
In most cases, people want a broad and comprehensive General Power of Attorney. This provides power to your attorney to act on your behalf, execute all documents, and do all lawful acts for you, including such things as banking, entering into and using safety deposit boxes, selling property (including your home or other land), managing or subdividing your property, borrowing money, settling accounts, settling disputes, investing your money, and paying taxes.
When setting up a Power of Attorney it is essential to clarify if it is an Enduring Power of Attorney. If it does not specifically say that it does not end if you become mentally incapable, the Power of Attorney will be voided by your mental incapacity. Having the Power of Attorney fail due when an illness or crisis arises can lead to a disaster. Normally, people need a Power of Attorney to be in place in case when they are not able to manage their own affairs, or need help. Just when your Attorney needs the authority to help, they may no longer have it. In such a circumstance, your loved ones may have to hire a lawyer and seek an Order of Committeeship from the Court, which is a complicated, invasive, and often extremely costly process. (The application alone can cost $3000-$5000 dollars!)
It is also possible to set up a Limited Power of Attorney, or a Springing Power of Attorney. These are special cases. A Limited Power of Attorney is usually used for an express and limited purpose, such as authorizing an individual to pay a certain account, or to give powers for a limited period of time. A Springing Power of Attorney coming into effect on the occurrence of a certain event. We can work together to make sure that the Power of Attorney is right for your situation.
An Attorney must always act in accordance with the instructions in the Power of Attorney. Further, the power granted must always be used to your benefit, and for no other purpose. The Attorney must keep accurate records of all transactions concerning what they have done for you. As long as you are mentally competent, you can revoke a Power of Attorney in writing at any time.
Your Health Care Directive
You have the right to accept or refuse medical treatment at any time. And your medical professionals must inform you about your treatment and get your consent. However, what if you can’t provide instructions?
A Health Care Directive grants to another person (your health care “proxy”) the authority to make decisions affecting your health, treatment, and body. These are decisions affecting you (not your stuff), and while you are alive, including life-saving medical decisions and decisions affecting the quality of your life. This document is extremely important, and yet many people ahve never heard of it!
A Health Care Directive is a document that allows you to express your wishes about the amount and type of health care and treatment you want to receive should you become unable to speak or otherwise communicate this yourself. If you have strong opinions about your health care treatment and care, this document will ensure that your wishes are followed. It also allows you to give another person the power to make medical decisions for you should you ever be unable to make them yourself.
I can prepare a personalized Health Care Directive for you, but given the importance of these decisions, the Government of Manitoba has created a one-page form to allow individuals to appoint a proxy. It’s simple, straight-forward, and easy to complete. It is designed for individuals to be able to fill it out without a lawyer (and it’s free!). I can also help answer any questions you may have about the form.
Troy Harwood-Jones is a commercial lawyer and corporate litigator at PKF Lawyers, in Winnipeg, Manitoba. Troy’s primary areas of practice are in the arenas of Civil Litigation, Corporate and Commercial Law, and Wills, Estates, and Elder Law. Troy has unique expertise in the practice areas relating to e-commerce businesses as well as Trademarks and Intellectual Property Law.