BC CEAS Is a Wealth of Free Legal Information On Elder Law

elder law 2

The BC Centre For Elder Advocacy and Support (BC CEAS) website contains a Wealth of Free Legal Information on Elder Law Issues.

 

I have taken the liberty of copying their excellent article on basic Power of Attorney information as an example of the quality of the legal information provided .

Power of Attorney Wednesday, July 28th, 2010 By the legal staff of the BC CEAS Elder Law Clinic

What is a Power of Attorney?

A power of attorney is a legal document that gives another person the power to take care of your financial and legal matters for you. The person you give this power to is called the “attorney,” and you are called the “donor.” (Here, “attorney” does not mean lawyer.)

A power of attorney gives your attorney the authority to take care of only your financial and legal affairs. This could include paying bills, doing banking, or selling real estate on your behalf. It does not allow him or her to make decisions about your personal or health care.

What are Powers of Attorney Used For?

There are many reasons why a person might choose to make a power of attorney.

One reason is that they may need temporary help taking care of their financial matters if they will be away for a while. For example, if you are going on vacation and will need some banking done while you are gone, you can have a power of attorney drawn up giving a family member or other person the power to take care of this while you are away. You could also have a power of attorney drawn up if an illness or injury makes it difficult for you to handle your own financial affairs.

People also commonly make a power of attorney as a form of advance planning, to ensure that a family member or other person of their choice is legally able to take care of their financial affairs if they become “mentally incapable” of managing their own finances in the future.

This kind of power of attorney is often called an “enduring” power of attorney. It continues in effect – or “endures” – even if you become mentally incapable. It is important to know that, if you should become mentally incapable of making a power of attorney, it is “too late” to do so if you don’t already have one in place. You have to plan ahead and do it in advance. If you do not have a legal power of attorney appointing someone to act for you in place when you become mentally incapable, then your loved ones will need to go to court to get “committeeship” (the legal authority to handle your affairs). Going to court is an expensive and time consuming process, and there is no guarantee that the court would decide to grant the legal powers asked for.

An enduring power of attorney is a simple tool that ensures that the person of your choice is able to easily step into your shoes and manage your finances when you become incapable of doing so, without having to go through the court process. To create an enduring power of attorney, you should ensure that the following sentence is included in your power of attorney document: “In accordance with the Power of Attorney Act, I declare that this power of attorney may be exercised during any subsequent mental infirmity on my part.”

Who Should I Name as My Attorney?

You can choose any capable person to act as your attorney, so long as he or she is 19 years of age or older and willing to act as your attorney. It is very important that you give careful consideration to who you choose to act as your attorney. He or she will have significant power over your financial affairs, and significant responsibilities.

Choose someone who you absolutely trust, and who is good at handling money. While most people choose their spouse, child or other loved one to be their attorney, careful thought should always be given to the appropriateness of the appointment.

In addition to the skills and trustworthiness of the person, you might consider whether the responsibility of acting as your attorney could cause undue stress or strain on the person or on your relationship. If you wish, you can choose more than one attorney. If you do this, you need to write in the document whether you want them to have to act together, or whether they can act independently.

You can also name one or more alternate attorneys who can take over if your first attorney becomes unable or unwilling to act. If you have no relatives or friends who are willing and able to serve as your attorney, you can choose a trust company, or the Public Guardian and Trustee (a government official), to act as your attorney.

In either case, you will be charged fees for their services. Your Attorney’s Powers The breadth of your attorney’s powers depend on what powers you give them. For example, if you create a limited power of attorney giving your son only the power to deposit your pension cheques, then your son will have the legal power to do only that – deposit your pension cheques.

However, if you create a general power of attorney that does not have any limits in it, then your attorney will generally have the power to do anything financial or legal that you can do for yourself. This could include, for example, cashing your cheques, withdrawing money from your bank account, dealing with your income taxes or buying or selling property on your behalf. (However, there are special requirements that apply if you want your attorney to be able to deal with real estate property – see Powers of Attorney for Real Estate below.)

Your Attorney’s Responsibilities

Your attorney is legally required to act honestly and in good faith, in your best interests. Your attorney must keep careful records of the financial activities done on your behalf and give the records to you upon your request, and must keep your affairs separate from his or her own.

When Powers of Attorney Start and End

A power of attorney comes into effect as soon as it is signed, however it does not have to be used right away if you do not need help yet.

Make sure your attorney knows when you want him or her to start acting on your behalf. If you prepare a limited power of attorney for a specific purpose or a specified period of time (for example, to handle your banking while you are out of town), your power of attorney will expire when the stated tasks have been completed and/or on the end date noted in the document. If you instead prepare a general attorney, subject to some exceptions your power of attorney will normally continue in effect indefinitely until you revoke it or until you or your attorney die (unless you have named more than one attorney or an alternate to act in the event an attorney dies).

Also, unless you have created an “enduring” power of attorney by including an enduring clause as discussed above, your power of attorney will end if you become mentally incapable.

Revoking a Power of Attorney

As long as you are still mentally capable of doing so, you can normally revoke (cancel) your power of attorney at any time.

To revoke a power of attorney, you should notify your attorney in writing that the power of attorney is revoked effective immediately. Also notify in writing all banks, businesses, organizations and individuals that your attorney deals with, advising them that the power of attorney has been revoked and asking them to destroy all copies of the document they have.

Making a new power of attorney does not automatically cancel an old one. It is possible to have more than one power of attorney in effect at the same time. If you want to make sure you have only one power of attorney in effect, when you make a new power of attorney ensure that you write at the beginning “I revoke any and all powers of attorney I have previously made.”

Banks’ Power of Attorney Forms

Banks often have their own power of attorney forms they want their customers to use. If you have your own power of attorney that covers banking matters, they have no right to require you to use their form. You could ask to speak with the bank manager or, if necessary, call a lawyer. Powers of Attorney for Real Estate If you want your attorney to have the power to sell your real estate property or deal with mortgages or easements for you, there are special requirements. You must sign the power of attorney in the presence of a lawyer or notary (and the lawyer or notary must also sign), and you must register the power of attorney at the land title office and comply with other legal requirements. If you want your power of attorney to include these powers, consult with a lawyer for advice.

Preparing a Power of Attorney Document

There are power of attorney forms in the Schedule to the British Columbia Power of Attorney Act, available online on the Internet. There are also sample BC power of attorney forms and kits available online and in legal publications you can find in the library and in bookstores. However, it is best to get some professional help, especially if you have a complicated or unusual situation.

As noted above, if your power of attorney is to deal with real estate, you must go to a lawyer or notary public.

Pre-planning for Health Care Decisions

A power of attorney covers financial and legal matters only. If you want to plan ahead and choose who will make health care and treatment decisions for you when you no longer can, you can make what is called a “Representation Agreement” naming whoever you want to make those decisions. Nidus Registry for Enduring Powers of Attorney and Representation Agreements The Representation Agreement Resource Centre has an online registry called the Nidus Registry where you can register your enduring power of attorney or representation agreement, if you wish.

The fees are $25.00 for set-up and the first registration, and $10.00 for each additional registration. You can register yourself by going to www.nidus.ca on the Internet, or ask family or friends to help.

You can also phone the Nidus Registry and Resource Centre for help with registering. Their phone number is (604) 408-7414(604) 408-7414. This BC Centre for Elder Advocacy and Support public legal education article was written in 2009. It contains general information only and is not a substitute for getting legal advice about your particular situation.

Section(s): Legal Research Articles, Resources Tags: Power of Attorney, Research – See more at: http://bcceas.ca/power-of-attorney/#sthash.qYASRVHg.dpuf

 

When Does a Common Law Marriage Come to an End

It is not always clear, even between the spouses themselves, when a common law marriage came to a legal end.
The Courts have accordingly developed certain guidelines to assist them.
The test of whether a relationship is at an end is objective; W.A.S. v. D.W.T., 2003 BCSC 865, paras. 18-26; Eisener v. Baker, 2007 BCSC 83at paras. 32-37, Nathu v. Miller, 2009 BCSC 1155at paras. 64-68.
The issue of when the marriage-like relationship terminates in a common-law spousal relationship has recently been before this court in Markin v. Gysel, supra, and S. (W.A.) v. T. (D.W.) (2003), 40 R.F.L. (5th) 389, 2003 BCSC 865 (B.C. S.C.).
33      S. (W.A.) v. T. (D.W.) dealt with the breakdown of a long-term common-law relationship of approximately 20 years, in which both parties contributed financially and domestically, at least initially. The relationship was “fragile and uncertain” long before the couple separated, with Mr. T. developing serious drug and alcohol abuse problems at an early stage in the relationship. In relation to Ms. S.’s claim for spousal support, Groberman J. held that the court had no jurisdiction to grant such relief, because the application was brought seven weeks more than one year after the parties ceased to live together. Groberman J. also found that the parties had ceased to live in a marriage-like relationship long before the defendant physically moved out of their shared house. He stated at ¶21-23:
I reject the argument that the parties lived together after December 26, 2000. On that date, Ms. S. became aware that Mr. T. was having, and intended to continue to have, a romantic relationship with Ms. C. Ms. S. had clearly told him that he could not continue to live with her in those circumstances, and Mr. T. left. While Ms. S. may have had some hope that her relationship with Mr. T. could be resurrected, I find that there was no objective basis on which she could possibly have concluded that they were still living together.
In particular, I find that long before December 26, 2000, Mr. T. and Ms. S. ceased to have a marriage-like relationship. Aside from the pooling of financial resources, they had little to do with one another, and had very limited social interaction. They had had no intimate relations for over five years, and had not presented themselves as a couple to others for some time. Indeed, it is questionable whether the two were living together even before December 26, 2000, or were rather living separate and apart under the same roof.
34      S. (W.A.) v. T. (D.W.) was followed in Markin v. Gysel, supra. That case involved a four-year common-law relationship in which the parties had one child. After the man moved from the parties’ home, he voluntarily paid the woman $1,000 per month, plus expenses in relation to the home. With respect to when the parties ceased to live in a marriage-like relationship, Joyce J. held that the parties separated before the defendant actually moved out of the home. Although the parties continued to eat meals together and share the same bed for a time, the defendant had made clear his intentions that he did not want the relationship to continue, sexual relations terminated shortly thereafter, and he subsequently moved into a spare room before finally leaving the home.
35      Another relevant case is Thompson v. Floyd, 86 B.C.L.R. (3d) 56, 2001 BCCA 78 (B.C. C.A.). That case involved a common-law relationship that extended over a number of years. For health reasons, the plaintiff left the parties’ home and moved in with her family, although she continued regular communication and visits with the defendant. Despite the fact that the parties were physically separated, McEachern C.J.B.C. held that the trial judge had not erred in concluding that the marriage-like relationship continued, at least until the last time the couple had sexual relations. He noted that it was significant that neither party made a direct statement that they regarded the relationship to be over until the parties began discussing the sale of their home, a few months before the action was commenced (at ¶32).
36      Thus, it is clear from the cases that the point at which the parties ceased living in the same residence is not necessarily determinative of the date their marriage-like relationship terminated (see also Hughes v. Boyd, 2006 BCSC 1669 (B.C. S.C.) at ¶4, agreeing that the key issue is when the “marriage-like” quality of the relationship terminated, not simply when the parties ceased to live under the same roof). The key factors in determining when a couple have ceased living in a marriage-like relationship include the absence of sexual relations, a clear statement by one of the parties of his or her desire to terminate the relationship, physical separation of the parties into different rooms of the same house or different residences, or the couple no longer presenting themselves to the outside world as a couple. Additionally, the method in which the spouse filed income tax returns may be a relevant consideration (see Oswell, supra, at ¶7), and provides objective evidence of whether a person considered himself or herself to be involved in a marriage-like relationship.
37      In this case, Mr. Baker took clear action to terminate the marriage-like relationship on August 14, 2003. He moved his furniture out of the House and ceased to reside there. The parties ceased to have an intimate relationship at that time. He made clear that he did not want the relationship to continue. After this date, he was away most of the time. By October of 2003, Mr. Baker was making clear attempts to remove Ms. Eisener from title to the House. The plaintiff could not reasonably have believed that the relationship would continue after that point. Further, she identified herself as being single on her 2002 income tax return. Additionally, her behaviour in public and toward Ms. Rollin and Ms. Cousson contradicts her testimony that the parties remained in a marriage-like relationship until December 2004.

The Criteria of a Marriage-Like Relationship

The Criteria of a Marriage-Like Relationship

The criteria generally speaking for a marriage- like relationship are as follows, as recently laid out in  McFarlane v. Goodburn Estate 2014 BCSC 1449:

The question of whether a couple is to be regarded as having had a marriage-like relationship can be answered having regard to objective and subjective criteria.

The nature of the objective test and its limitations were described by Justice Cory in M. v. H. [1999] 2 S.C.R. 3, at para. 59:

Molodowich v. Penttinen (1980), 17 R.F.L. (2d) 376 (Ont. Dist. Ct.), sets out the generally accepted characteristics of a conjugal relationship. They include shared shelter, sexual and personal behaviour, services, social activities, economic support and children, as well as the societal perception of the couple. However, it was recognized that these elements may be present in varying degrees and not all are necessary for the relationship to be found to be conjugal. … In order to come within the definition, neither opposite-sex couples nor same-sex couples are required to fit precisely the traditional marital model to demonstrate that the relationship is “conjugal”.
22      In my view, there were sufficient objective indicators in this case for the couple to be regarded as spouses. They shared the plaintiff’s home and they shared her bed. The plaintiff provided care and support to Mr. Goodburn to the degree and in the manner of someone who was more than simply a friend. In their interactions with members of her family, and in their other social interactions, they would have appeared to function as a unit.
23      The subjective test, based on the court’s assessment of the parties’ degree of mutual commitment, is as stated by Justice Lambert in Gostlin v. Kergin (1986), [1986] 5 W.W.R. 1, 3 B.C.L.R. (2d) 264 (C.A.). Referencing the support obligations set out in s. 57 of the Family Relations Act, R.S.B.C. 1979, c. 121, he stated:
So I would ask whether the unmarried couple’s relationship was like the relationship of the married couple in that the unmarried couple have shown that they have voluntarily embraced the permanent support obligations of s. 57. If each partner had been asked, at any time during the relevant period of more than two years, whether, if their partner were to be suddenly disable for life, would they consider themselves committed to life-long financial and moral support of that partner, and the answer of both of them would have been “Yes”, then they are living together as husband and wife. If the answer would have been “No”, then they may be living together, but not as husband and wife.
24      As with any civil case, this aspect of the plaintiff’s claim need only be proven on a balance of probabilities. In my view, the reasonable conclusion to be drawn from the facts of this case is that the answer to that question would have been “Yes”.

Dysfunctional Families Are Everywhere

Dysfunction

 

Dysfunctional families are everywhere.

 

Some years ago the Vancouver Sun ran a feature on dysfunctional families and  reported that one in three British Columbians expect to be disinherited by their parents.

Practising estate litigation for over 40 years, it is easy to believe there are more dysfunctional than functional families. Indeed the dysfunctional family is the bread and butter of our practice. With the growing number of second marriages and blended families, the numbers are ever increasing.

In this article wehope to share some insights into dysfunctional families. IWe have no scientific expertise, only a wealth of practical experience dealing with the financial, emotional and psychological aftermath of such families.

WHAT IS A DYSFUNCTIONAL FAMILY?

Most of us grow up believing our own family is “normal”. It is only with life experience that we may come to recognize there is perhaps “something unusual” about our own upbringing and family life. We may also come to realize that many families are unfortunately not the happy, healthy families to which we all aspire.

Typically a dysfunctional family is one where the relationships between parents and children are strained and unnatural. Although there may be many different root causes, such families usually involve one or more family member with a serious problem that impacts every other member of the family. In turn, the other family members adopt atypical roles and behavior that allow the family to function on a basic level. For example, an older child may assume a caretaking role towards younger siblings to cover for an alcoholic mother.

A dysfunctional family often means parents fail to adequately provide for their children’s emotional, psychological and/or physical needs. Such children often suffer from low self-esteem all of their lives. Needless to say, this impacts every aspect of their lives from jobs to marriages to financial security.

Many families may seem normal at first glance. Scratch the surface, however, and some surprising relationships are exposed. For example, a recent case involved a family who, four days before the death of the patriarch, learned that he had another family in another city. You can imagine the profound shock and grief caused by this deception. The surviving family questioned their basic beliefs about who they were.

TYPES OF DYSFUNCTIONAL FAMILIES

The following are some examples of patterns occurring in dysfunctional families. Although classifed under various titles, there is often a great deal of overlap as often many problem behaviours occurs in the same family.

1) Addiction

In this scenario one or both parents have addictions relating to drugs, alcohol, gambling, sex, work or food. Any such addiction can clearly have strong negative effects on other family members. One case we had involved a crack cocaine addict who was disinherited by his father after moving in with him and turning his home into a crack house.

Alcohol abuse is far more common and is extremely destructive as well.

2) Physical Violence

In such families, one or both parents use physical violence as a means of control through intimidation. The children may be the victim of violence, may be forced to witness their mother being beaten, to participate in punishing siblings or simply may live in fear of explosive outbursts. Such children frequently grow up with anxiety and depression issues. What is more, they are far more susceptible to abuse themselves. Sons raised in such families are at a much higher risk of becoming abusive husbands while the daughters more often become victims of violence.

3) Lack of Emotional Support

In these families, one or both parents fail to provide their children with adequate emotional support (often they also fail to provide basic physical and financial care at the same time). For example, one case involved a man who had simply been ignored as a child and left to fend largely for himself. He grew up to be an emotional cripple who completely lacked social skills and lived a very isolated existence. Thus he was awarded a large share of his parents’ estates. He would need those funds to survive since he was effectively unemployable.

4) Religious Fundamentalism and Rigidly Dogmatic Beliefs

Such families frequently involve parents who exert a strong authoritarian control. These families rigidly adhere to a particular belief, sometimes religiously or culturally based. Compliance with cultural or religious expectations is not expected, it is demanded.

For example we had a one case involving an overly strict mother who put down the family dog because her daughters girls did not keep their room clean enough.

A more extreme example of such behavior would be the family “honour killings” we read of from time to time. These involve male family members killing a female member because she is believed to have “brought shame” on the family.

5) Overly Possessive Parents

We have had many cases involving overly possessive parents who exploit their children, treating them as possessions whose primary purpose is to respond to the parents’ needs. They often do not encourage their child to become independent. This sometimes results in this scenario where one child, typically the youngest, never leaves home. Instead the child cares for the parent until death and is often “rewarded” or “compensated” for his or her “sacrifice”. Most often the other siblings view him or her as a freeloader.

It is sometimes amazing to hear the childish emotions these situations continue to evoke in adult children. In one case we represented a youngest child who had never left home and who was rewarded with privileges and a larger inheritance than his 4 older siblings. At the examinations for discovery when the older sister was questioned as to why the others hated our client , she responded “Because he was allowed cheese sandwiches before bed, and we were not.”

5) Sexual Abuse

As more cases of family sexual abuse surface, it is clear that sexual abuse by anyone but especially a parent will produce lifelong emotional scars for the victim. Typically it is the father or stepfather who sexually abuses a daughter or stepdaughter. It is shocking however, how frequently mothers ignore the disclosures of abuse and deny that their husband (the breadwinner and meal ticket) could have perpetrated such acts. This failure to believe and to protect the child only aggravates an already difficult situation.

One case we had involved the death of a father who had divided his estate in equal shares among his children and one grandson. When his daughter was questioned as to the motives for such a distribution, she disclosed that her father had sired this son. .

CONCLUSION

Every family varies greatly in the frequency and severity of dysfunctional interactions.

In dysfunctional families children may be forced to take sides in conflicts, they may be ignored, discounted, criticized or abused. Other parents may be inappropriately intrusive, overly involved and protective. Many children of dysfunctional families complain that their parents were emotionally distant and uninvolved. The fundamentalist family may provide excessive rules while the addicted parents may provide no guidelines or structure. Some children may be rejected while their siblings receive preferential treatment. Children may be slapped, punched, kicked or emotionally abused and locked out of the house. Some children runaway or leave home at an early age. Others never leave.

The bottom line with all dysfunctional families is that such abuse and neglect inhibit the development of healthy adults with healthy relationships. As adults, such people often have difficulty in judging and trusting others and themselves. They often experience difficulties in their workplace, in their relationships and with their very identities.

What is more, in the world of the estate litigation, they are often disinherited.

New Family Law Act Expected March 18,2013

New Family Law

The Family Relations act will be replaced by the new Family Law act, on or about March 18 next.While disinherited.com does not venture into matrimonial disputes, the fact is that the laws of family and estates are increasingly becoming interwoven, and not necessarily smoothly at all.

In any event, it is important to keep an eye on family law developments, so this blog is intened only as the merest of an oversight of some of the changes to look for in family law, very soon.

I apologize for the loose format, but it is a composite of my own notes from a seminar on the topic.

It is complicated legislation that has taken years to develop, and may not in fact be quite yet finished in the details.

 

New act has the notion of ” family property” which is everything unless “excluded property”, with the notion of former “family purpose use” no longer being the test.

Property rights are extended to common  law couples after 2 years

Family debt is defined and can be re- apportioned between the spouses- ie one spouse might be ordered to pay all or some of the other spouses debts

Spouse is defined as either – married, or common law for 2 years

But a party can  get spousal and child support if they live together less than 2 years, if they have a child

“Family property” is defined

On date of separation what you own is family property unless it is excluded property

Same with property acquired after separation if acquired from a family property

Family property includes a share in a limited company

The property you bring into a marriage is excluded property,  but the amount of any increase in value in the property, makes it  family property

S85 sets out excluded property:

Gifts

Inheritances, but not their growth in value

Property owned  before the relationship

Non property related insurance

Discretionary trusts

Property traceable back to excluded property

 

Excluded property increase in value is divided

If the property is outside BC, then the property can’t effectively be divided

 

Excluded property can be divided if it is significantly unfair not to divide it after consideration of the duration of the relationship and the  direct contribution ( not indirect contribution any longer)

Can divide family debt and assets disproportionately, but now requires it to be significantly unfair

Valuation date is s 87 date agreement signed, or date of hearing

Date of separation can be important as it is the triggering event and what date is the actual date

Marriage agreements – can still opt out and court may set aside agreements for failure to disclose assets, debts, or other defect in the process

 

The other is significant unfairness due to length of time, intention of parties to achieve certainty, the degree to which the spouses relied upon the agreement

 

Make sure the other side gets good legal advice as there is a risk that the spouse can later argue they did not understand it

 

Court can order that spousal and child support can survive death and an order can be made against the estate for continued child support.

Claim For Common Law Spouse Status Dismissed

Claim For Common Law Spouse

Buell, Buell and Buell v Unger 2011 BCSC 351 involves an intestacy of the deceased and a contest between a purported common-law spouse and his previous wife of 21 years and their two children as to who inherits the estate.

The claim for common law spouse was dismissed and the family inherited the estate on the intestacy.

The court held that the defendant Unger had the onus of proving that she was a common-law spouse and that her evidence fell far short of proving that she

was living in a marriage like relationship with the deceased for a period of at least two years immediately before his death.

He for example spent many months at a time living on his boat I himself while she lived on the mainland where she worked.

 

The deceased Buell suffered from severe alcoholism and  died intestate .

 

Ms. Unger cross-applied for a declaration that she was Mr. Buell’s common-law spouse as defined in s. 1 of the Estate Administration Act, R.S.B.C. 1996, c. 122 (the Act):

“common law spouse” means …

…

(b)        a person who has lived and cohabited with another person in a marriage-like relationship, including a marriage-like relationship between persons of the same gender, for a period of at least 2 years immediately before the other person’s death.

Mr. and Mrs. Buell had separated in June of 2005 after 21 years of marriage.

 

The Court followed the BCCA decision of Gostlin v Kergin ( 1986) 3 BCLR (2d) 264 as follows:

“The framework for resolving the question of Ms. Unger’s status is found in Gostlin v. Kergin (1986), 3 B.C.L.R. (2d) 264, 1 R.F.L. (3d) 448 (C.A.). In that case, the Court of Appeal considered the definition of “spouse” in the Family Relations Act, but its discussion of the “marriage-like” aspect of the definition (“lived together as husband and wife for a period of not less than two years”) is equally applicable to the definition with which we are concerned: see Harris v. Willie Estate, 2001 BCSC 143, 37 E.T.R. (2d) 220, and Janus v. Lachocki, 2001 BCSC 1702, 43 E.T.R. (2d) 49..

[8]      At pages 267-8 of Gostlin (B.C.L.R.), Lambert, J.A., for the Court, said this:

But marriage does not suit every couple who want to share their living accommodation. For religious, moral, sexual, financial or other reasons they may be unable to marry or may prefer not to marry. Some couples may behave towards each other and towards the outside world as if they were married. Their relationship may be one of permanence and of commitment. They may eagerly embrace the obligations of s.57. Other couples may prefer quite a different relationship. They may want to retain their independence from each other. They may find long-term commitments stifling, and emotional inter­dependence cloying. They would shun the obligations of s.57.

Surely society can accommodate those who prefer to live together without commitment. If there are no children involved, there is no reason to force financial commitments on couples who do not want them. Independence should be a choice. But how can a couple exercise that choice except by not getting married to each other and not making any commitment to each other? If that is their wish, the expiry of two years from the start of their relationship should not force them into mutual commitments that they do not want.

The legislature has accommodated the diverse interests of different couples by use of the words “who lived together as husband and wife” in the definition of “spouse”. If a couple marry, then they are committed to the maintenance and support obligations of s. 57, no matter on what terms they live together. But if they do not marry, they are not committed to those obligations unless they lived together for not less than two years, and unless they do so as husband and wife.

In deciding whether a couple lived together as husband and wife, I would be guided by the scheme and intention of the Act itself. The purpose of the legislative scheme is to impose on an unmarried couple the same obligations under s. 57 as are voluntarily undertaken by a married couple. So I would ask whether the unmarried couple’s relationship was like the relationship of the married couple in that the unmarried couple have shown that they have voluntarily embraced the permanent support obligations of s. 57. If each partner have been asked, at any time during the relevant period of more than two years, whether, if their partner were to be suddenly disabled for life, would they consider themselves committed to life-long financial and moral support of that partner, and the answer of both of them would have been “Yes”, then they are living together as husband and wife. If the answer would have been “No”, then they may be living together, but not as husband and wife.

Of course, in the particular circumstances of any case, the answer to that question may prove elusive. If that is so, then other, more objective indicators may show the way. Did the couple refer to themselves, when talking to their friends, as husband and wife, or as spouses, or in some equivalent way that recognized a long-term commitment? Did they share the legal rights to their living accommodation? Did they share their property? Did they share their finances and their bank accounts? Did they share their vacations? In short, did they share their lives? And, perhaps most important of all, did one of them surrender financial independence and become economically dependent on the other, in accordance with a mutual arrangement.

 

What Is a Power of Attorney and How Do They Work?

Power of Attorney (POA)

What Is a Power of Attorney?( POA)

The BC Court of Appeal decision in Houston Estate v Houston 2012 BCCA 300 raises a few very good legal issues relating to Powers of Attorneys.

disinherited.com will blog further about this appeal case, but for starters, the case has an excellent review on this particular type of ageny called an Attorney.

A power of attorney is a type of agency.

At common law, where an agency was granted by deed giving specified authority to the agent, it was called a “power of attorney”. In British Columbia, the Power of Attorney Act has modified the common law with respect to powers of attorney. (Like counsel before us, I refer to the Act as it stood in April 2009 when the power of attorney in this case was exercised. The Act has since been amended substantially.) The Act does not define what is a power of attorney but provided in s. 9 that a general power of attorney “may” be in Form 1 or Form 2 of the Schedule to the Act. Neither form required that the document be executed under seal (and neither instrument in this case was). The Land Title Act contains additional requirements that apply to any document tendered for registration that has been executed under a power of attorney, and requires the registrar to maintain an index of powers of attorney: see ss. 51-57.

Being a type of agency, the power of attorney is subject to various rules, some of which are codified in the Act, for the protection of the agent. As Professor G. Fridman notes in Canadian Agency Law (2009), although at common law a power of attorney was strictly construed, the ordinary rules of construction of documents are employed in determining the scope of the agent’s authority where the document is not under seal or where the authority is given orally. Thus Fridman writes:

If the document involved is not a deed, or the contract of agency is parol, the agent’s authority is to be construed having regard to the purposes of the agency, i.e., the surrounding circumstances and the usual course of the business in which the agent is concerned. In particular, where general words are used, they must be construed and understood in light of the usual course of the agent’s business.

Writing which contains the agent’s authority is of prime importance, but if there is any ambiguity about the wording of the agent’s authority then, as long as the agent acts in good faith and in accordance with a reasonable construction of his authority (if there is more than one possible), he will be considered to have acted within his authority, whether or not in fact what he did was what the principal intended he should do. [At 64.]

Sections 3 and 4(1) of the Power of Attorney Act reflect the common law’s concern for the agent whose authority has been terminated without his knowledge:

3           If an agent purports to act on behalf of a principal at a time when the agent’s

authority to do so has been terminated and

  1. the act is within the scope of the agent’s former authority, and
  2. the agent has no knowledge of the termination,

then, for the purpose of determining the liability of the agent for the act, the agent is deemed to have had the authority to so act.
4(1)      If

  1. the authority of an agent has been terminated, and
    1. a person who has no knowledge of the termination purports to deal with the principal through the agent,

then, for the purpose of determining the legal rights and obligations of the principal in relation to that person, the transaction is, in favour of that person, deemed to be as valid as if the authority had existed.

At common law, an agency normally terminates when the undertaking entrusted to the agent has been performed or where the agency was given for a stated period of time. An agency will also terminate if the subject matter of the agency is impossible of performance, or upon the death or insanity of either the principal or the agent while the agency is extant: Fridman, supra, at 123-28. In British Columbia, amendments to the Act in 1979 reversed the common law rule regarding the principal’s mental incompetence by providing the option of the “enduring” power of attorney: see s. 8(1), quoted above at para. 20.

Except where the agency is irrevocable (i.e., where the agent by deed or for valuable consideration has agreed to act on the principal’s behalf in order to protect an interest of the agent)the principal may unilaterally revoke or terminate the agency relationship, subject to its express terms. It seems clear that the agency is revoked by the giving of appropriate notice to the agent, and no prior warning is required at common law. ”

Enduring Powers of Attorney Now Have New Teeth

Powers of AttorneyFollowing years of consultation, an amended Power of Attorney Act  came into effect on September 1, 2011, and now has “some teeth” in enduring powers of attorney.

This new Act brings important changes to the law governing enduring powers of attorney (“EPOA”) i.e.  those which remain or become effective after the maker or grantor of the power of attorney becomes mentally incompetent.

The important changes, by and large apply to enduring powers of attorney and not to other powers of attorney i.e. those which lapse once the maker or grantor (known as an “adult” in the new Act) becomes mentally incompetent.

Historically, enduring powers of attorney provided great potential for the financial abuse by unscrupulous attorneys.  It is thus a welcome relief to see the tightening of the rules surrounding the granting and use of these enduring powers of attorney.

In this article we will summarize, in general terms, some of the noteworthy new provisions however we will only touch on a few.  It is thus crucial for legal professionals to read the Act and inform themselves.

For our purposes, the noteworthy changes dealing with enduring powers of attorney (EPOA) may be classified broadly as follows:

a) the repeal of the former s.8  which previously set out the rules for EPOAs,

b) the enactment of new Part 2  containing the new rules covering

  • the making of EPOAs ,
  • setting out the duties, powers, liability and compensation of attorneys
  • setting out when an EPOA becomes effective, how it may be changed, revoked, suspended or terminated and the limits on the authority of the attorney,

c) the enactment of new Part 3  covering general matters such as access to information, reporting abuse and neglect to the Public Trustee, investigations by the Public Trustee, seeking directions from the court plus other procedural and jurisdictional matters.

d) the inclusion of a new optional standard form for powers of attorney.

The Mental Capacity Required to Grant an Enduring Powers of Attorney

Much of the financial abuse seen in our own practice has involved abuse by an appointed attorney i.e. the very person previously entrusted by the victim to handle his or her affairs.

We thus view the raising of the bar in terms of the mental capacity required of a person granting a EPOA as a refreshing change.    The Act sets out several criteria which must be met in order for a person to be mentally capable of granting an enduring power of attorney.

As an aside, some of the wording in the Act seems a little confusing at first blush—for example the maker of the POA is described as an “adult” and the criteria for capacity are stated in double negatives.

For example, s. 12 specifies that an adult may make an enduring power of attorney unless the adult is incapable of understanding the nature and consequences of the proposed enduring power of attorney. The adult is incapable of understanding the nature and consequences of the proposed enduring power of attorney if the adult cannot understand all of several concepts.

To restate this in positive terms, in order to be able to make a EPOA, a person (an “adult”) must be able to understand all of the following:

a) The property the adult owns and its approximate value;

b) The obligations the adult owes to his or her dependents;

c) The fact the appointed attorney will be able to do anything financial, that the adult could do if capable, subject to the conditions and restrictions set out in the EPOA, the only exception being making a new will on his or her behalf;

d)  That, unless the attorney prudently manages the adult’s business and property, they may decline in value;

e)  An attorney can, and may possibly misuse their authority;

f)  The adult may revoke the EPOA so long as they are mentally capable; and

g)  Any other prescribed matter i.e. any further matter set out in a legal enactment

s. 11 presumes an adult to be mentally capable “until the contrary is demonstrated”. The Act unfortunately provides little guidance as to what mechanism will “demonstrate” incapacity.  Presumably demonstrating incapacity will involve proving the absence of understanding of one or more of the concepts delineated in s. 12.

Raising the Bar in terms of Required Mental Capacity

The new s. 12 significantly raises the bar vis-à-vis the mental capacity required to grant a valid EPOA.  Previously our courts used a lesser standard in assessing the mental capacity required.

The test for mental capacity was previously set out in the decision of Egli v Egli Estate, 2005 BCCA 627.  According to this decision, the mental capacity required was simply whether or not the maker (adult) understood the nature and effect of the EPOA.

There was no requirement that, at the time of granting, the adult know and understand the nature and extent of his or her property and financial affairs.  Neither was there any requirement that the adult, then be capable himself or herself of performing the acts, authorized by the EPOA, for the attorney to perform.

This previously low standard has thus been substantially raised in terms of the mental capacity required to grant a EPOA.  It is now in the same range as that required to make a will.

If an adult lacks capacity based on the various criteria set out in s. 12, then the enduring power of attorney will be invalid.

This new, more exacting standard will undoubtedly reduce the potential for financial abuse by attorneys.

Appointment of an Attorney

An attorney is a trustee or fiduciary in respect of the adult appointing him or her as attorney.

There are restrictions set out in s. 18 of the Act as to who may be named as an attorney.  To avoid an obvious conflict of interest, caregivers, may not be appointed as attorneyunless they are the child, parent or spouse of the adult.

Other than caregivers, the adult may appoint as attorney an individual, the Public Guardian and Trustee, or a trust company licensed under the Financial Institutions Act.  The adult may also appoint alternate attorneys, or appoint more than one attorney and assign the same or different areas of authority to each.

An adult may give an attorney the power to do anything which the adult may otherwise lawfully do, by agent, in relation to the adult’s financial affairs. These powers are limited to the adult’s financial affairs.  By the s. 10 definition, the adult’s financial affairs includes their business and property, and the conduct of their legal affairs.

An attorney does not have power to make decisions about the adult’s personal care or health care.  Such matters are instead left to be dealt with under any Representation Agreement or Advanced Directive

Duties of Attorney

The essential duties of an attorney are set out in s. 19.   That section reads, in part, as follows:

“s. 19 (1) An attorney must

(a) act honestly and in good faith,

(b) exercise the care, diligence and skill of a reasonably prudent person,

(c) act within the authority given in the enduring power of attorney and under any enactment, and

(d) keep prescribed records and produce the records for inspection and copying at the request of the adult”

Notably s 19 (1) (d) creates a new statutory requirement to keep and produce financial records. These records are defined in s. 2 of the regulations.  They include a current list of assets and liabilities, invoices, bank statements, and other records as required to provide a full accounting of receipts and disbursements, income and capital.

s. 19 (3) includes many other duties such as, in general terms, a duty to

a) give priority to meeting the personal care and health care needs of the adult, to the extent reasonable

b) invest only in accordance with the Trustee Act, unless the EPOA states otherwise

c) foster independence and encourage the adult’s involvement in decision-making, to the extent reasonable

d) not to dispose of property that is left as a specific gift under the adults will;
e) to keep the adult’s personal effects at their disposal, to the extent reasonable

s. 19 (4) requires the attorney to keep the adult’s property separate from his or her own unless the property is jointly owned by the adult and the attorney.  In other words, the attorney must not mingle the adult’s property with his or her own.

Powers of the Attorney

An attorney may make a gift or loan, from the adult’s property if the EPOA expressly permits this or if the adult usually made gifts of that nature and will have enough left over to cover their needs and obligations.  The total value of all gifts and loans in a year, however, must not be great than  $5000 or 10% of the adult’s taxable income for the previous year, whichever figure is the lesser.

An attorney has no power to make or change a will for the adult.  Nevertheless, an attorney may, with court approval, change a beneficiary designation such as, for example an insurance or pension benefit.  Otherwise the attorney has power to rename a previous beneficiary previously named by the adult while mentally capable, in any renewal or replacement instrument. In any new instrument, the attorney may name the adult’s estate as the designated beneficiary.

New Optional Template for Enduring Power of Attorney

The province has also provided for an optional new standard form for Enduring Powers of Attorney.   The new form, which is not mandatory, contains several useful provisions.  It includes

a)            a revocation clause;

b)            a procedure for appointing of an alternate attorney and a means for providing evidence of the alternate attorney’s authority to act;

c)            a specific statement of the attorney’s authority;

d)            a requirement to specify whether or not the attorney is to be compensated and, if so, how compensation is to be determined;

e)            a statement of the conditions precedent to the EPOA becoming effective.  For e.g. it may become effective immediately on signing by both the adult and the attorney or only upon the happening of a specified event such as a medical specialist declaring the adult  incompetent;

f)             a specific provision for signing by the attorney as well as the adult. Each of them must sign in the presence of a witness, if the witnesses a lawyer or notary publics; otherwise, 2 witnesses are required. This provision for  signing by the attorney is separate from the attorneys statutory declaration that is required if the EPA is to be filed in the land title office.

CONCLUSION

Enduring powers of attorney are a valuable tool in estate planning however there is unfortunately  an associated history of financial abuse.  In terms of this historical abuse there were several factors at play including

  • the low threshold for mental capacity to grant an EPOA,
  • the lack of record keeping requirements and
  • the lack of routine oversight of an attorney’s actions by the courts (in contrast to committeeships under the Patients Property Act)

We are optimistic that the new Act sets new standards for reducing this potential for financial abuse.

Although adults and attorneys will both require more legal advice than previously, this seems a good compromise in order both to limit the risk of financial abuse and to avoid the greater expense of committee proceedings and appointment under the Patients Property Act.

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