For estate-planning purposes, it is important for everyone to have a Power of Attorney and Representation Agreement in place.
Here's what we know:
- We are living longer.
- In the next 15 years, the population over 85 is estimated to increase by 80%.
- In the next 25 years, the percentage of the population with dementia is estimated to increase by 100%.
- Only 10% of deaths are of a sudden nature.
The stats are bit frightening, as it means many of us will suffer a physical or mental impairment before death. So the question becomes: What we can do to ensure our family is best able to deal with our incapacity?
How a Power of Attorney Will Help
A Power Of Attorney deals with financial matters such as paying the bills as well as legal matters. A representation agreement deals with health care matters such as hospital procedures and personal care decisions.
Without these documents, when you are unable to perform tasks, your family would need to apply to court for an appointment of a committee. The costs of doing so are one thing but more importantly, you want to avoid the stress on your loved ones.
And these are not just for the ageing population they are essential for everyone. You can be at the wrong place at the wrong time and suffer a physical or cognitive impairment. A car accident is an unfortunate but not an uncommon occurrence.
So do yourself and your family a favour get these done sooner than later, as later may be too late.
Real Estate Transactions
All that being said, just because you have appointed someone to act for you under a Power of Attorney, don't assume it is valid for buying or selling real estate in British Columbia.
A Power of Attorney must be in a form acceptable to the BC Land Title office and if the Power of Attorney was not prepared by a BC lawyer or notary public it is probably not acceptable.
If you intend to use a Power of Attorney for the sale or purchase of real estate, you should have your lawyer or notary public review the document and your intended use as early as possible. Discovering at the last minute that the Power of Attorney is not acceptable may result in the collapse of the transaction and even incurring legal liability for significant damages.
For buyers, it is important to know that most lenders will not allow their mortgage to be signed under a Power Of Attorney. There are a few exceptions, but if a buyer does not have a long-term relationship with the mortgage lender, this is essentially not an option.
For sellers, a Power of Attorney can be used but it is important to ensure that the name on the title to the property matches the name of the grantor on the Power of Attorney. The Land Title office may accept an affidavit confirming that the two names are for the same person but if possible you want to avoid the problem as acceptance of the affidavit is at the discretion of the Land Title office.
The Good News
Under BC legislation, a transfer of title or a mortgage must be witnessed by a person authorized to take affidavits under the Evidence Act of BC. An authorized person is a Notary Public in most foreign jurisdictions and in certain jurisdictions such as Australia and England it can also be a lawyer. Documents can be emailed for signature and once signed can be emailed back to the lawyer or notary public. The emailed documents can be used for closing the transaction.