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Power of Attorney for Property
There are two types of Powers of Attorney, one deals
with property (financial and otherwise) and one deals
with personal care. Both should be a part of any long
term plan. Today, we discuss the Power of Attorney for
property.
When you designate at Power of Attorney for property,
the authority of the attorney is dictated by you in the
terms of the POA. Most Powers of Attorney for Property
will have a general one-line statement saying the
attorney can do anything you can legally do in regards
to your property, except make a will. However, you have
every right restrict the authority of your attorney to
specific assets, or to specific transactions with those
assets.
A lack of detail in the POA can lead to problems. As
financial portfolios become more and more diversified,
boilerplate clauses can actually become a barrier to the
effective use of a POA. This can be particularly true in
the case of life insurance contracts since most
boilerplate clauses do not include any references to
insurance policies.
One way of avoiding these problems is to review the
types of assets you do have with your lawyer when
preparing a POA. Read the language of the document
carefully. Ensure that all the major assets you own are
covered in any non-inclusive list of assets and powers.
Are there any powers you do not want your attorney to
have? If so, review them with your lawyer and
specifically include any restrictions in the language of
the document.
In the life insurance context, POAs present unique
issues. For example, many institutions are unable to
accept an application for life insurance executed by an
attorney, and do not permit attorneys to obtain loans or
withdrawals from, or surrender a policy unless the POA
expressly provides that the attorney may do so. Most
importantly, the validity of beneficiary designations
made by an attorney is unclear under Canadian law. We
strongly recommend that only the policy owner make such
designations.
 If
you would like to discuss whether or not a Power of
Attorney is appropriate for your specific financial
situation, please give me a call at (877)-628-5762, and
I’d be happy to help you out.
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