What Is an Enduring Power of Attorney in Newfoundland and Labrador?

You may have heard the term when a parent was ill, or when a bank or lawyer asked whether someone has 'an enduring power of attorney'. The phrase sounds technical, but the idea is simple: it is a way to let someone you trust manage your property and affairs, even if you later cannot do so yourself.

In Newfoundland and Labrador this is governed by the Enduring Powers of Attorney Act. You may see it called the Powers of Attorney Act in everyday talk, but the Act's real name is the Enduring Powers of Attorney Act. This article explains the basics in plain language.

This article covers the law of Newfoundland and Labrador.

What it is and who the people are

Under section 3(1) of the Enduring Powers of Attorney Act, an enduring power of attorney is a power of attorney that the donor signs, that a qualifying witness countersigns, and that is expressly or impliedly exercisable during the donor's legal incapacity. The donor is the person giving the power. The attorney is the person receiving it. 'Attorney' here does not mean a lawyer.

The witness cannot be the attorney or the attorney's spouse or cohabiting partner. The attorney must be 19 or older. The Act has no registration requirement.

How it keeps working if capacity is lost

An ordinary power of attorney can end when the donor becomes incapable. The enduring version is designed to avoid that. A power meant to apply during incapacity, or to continue after it, is not terminated only because of the donor's later legal incapacity.

'Legal incapacity' means a mental disability such that the person would be unable to understand the nature and effect of an action. Who decides this in a real situation can depend on the circumstances, and a lawyer can confirm how it would apply.

If there is no enduring power of attorney in place when capacity is lost, the court may have to step in. The court can declare a person incapable of managing their affairs because of mental infirmity from disease, age, habitual drunkenness, drug use or other cause, and can appoint a guardian of the estate. An interested person, a claimant or the person responsible for the person's care may apply. Planning ahead can help avoid that process.

What the attorney can and cannot do

What an attorney may actually do depends on what the document says, so read it closely. What the Act is clear about is how the attorney must behave:

• Exercise powers in the manner that protects the best interests of the donor, and compensate for loss if they do not.
• Act as a trustee of the donor's property.
• Not appoint another person to perform the attorney's functions.
• If they acted honestly, reasonably and in good faith, they may be relieved of liability by a court.

Oversight, changes and ending it

The donor may revoke or terminate an enduring power of attorney at any time while having legal capacity. If the attorney becomes incapacitated, a court may substitute another attorney, and the Public Trustee may apply to do so. Where the donor is incapacitated, a court may order the attorney to submit accounts. The Public Trustee can also act as attorney.

If a guardian of the estate is later appointed by the court, the guardian must file an inventory within 6 months and account, and the property returns to the person on discharge. The Public Trustee manages finances only and does not generally make medical decisions.

Health care is a separate matter

An enduring power of attorney deals with property and financial matters. Health care decisions fall under the Advance Health Care Directives Act. A person 16 or older is presumed competent, and competence means being able to understand information relevant to a health care decision and its foreseeable consequences. Without an appointed substitute, the decision maker is chosen from a list that starts with the spouse, then children, parents and siblings, and each must be at least 19. A written directive must be signed and witnessed by at least 2 independent persons.

What to do next

• Find out whether a signed and witnessed document already exists, and where the original is kept.
• Check who signed as witness; it cannot be the attorney or the attorney's spouse or cohabiting partner.
• If you are the attorney, keep records of every transaction and keep the donor's money separate from your own.
• If you are worried about an attorney's conduct, ask a lawyer about court accounts or substitution.
• If no document exists and capacity is already lost, ask a lawyer about the court process.

Frequently asked questions