p>When you appoint someone as your attorney under an enduring
power of attorney, you give them the power to take care of your
financial and legal matters even if you subsequently become
incapacitated. This might include paying your bills and expenses,
depositing and withdrawing funds from your bank account, making or
changing investments, and even handling the sale of your house if
Some people appoint more than one person as their attorney.
Appointing two or more attorneys has its benefits as well as
challenges. The benefits include the ability for one to act when
the other is absent or unavailable, and the opportunity for the
attorneys to monitor each other's conduct. The challenges are
illustrated in a recent BC Supreme Court decision in
Sommerville v. Sommerville, 2014 BCSC 1848.
Mr. Sommerville appointed his second wife and one of his
daughters from his previous marriage as his attorneys under an
enduring power of attorney. He gave them the power to act
separately in all circumstances.
Mr. Sommerville and his second wife had married late in life.
During the marriage, they had maintained most of their assets
separately with a few joint assets. Since Mr. Sommerville had the
higher income, the couple had agreed that Mr. Sommerville would
deposit his pensions to a joint bank account for their personal and
living expenses. The wife also deposited a small portion of her
pensions to the same joint account. Throughout the marriage, the
wife managed the family's finances.
When Mr. Sommerville's physical and mental capacity declined
to the point of requiring long term care, the daughter, without
consulting her stepmother, directed most of Mr. Sommerville's
pensions to be paid into a new bank account in her name as his
attorney. The daughter was concerned that her father would need his
pension income to pay his future care costs. This action caused a
dispute to arise between the attorneys.
Under subsection 18(5) of the Power of Attorney Act,
two or more attorneys with the same area of authority must act
unanimously in exercising the authority unless the adult giving the
power describes the circumstances in which the attorneys need not
act unanimously, or sets out how a conflict between them is to be
resolved. However, Mr. Sommerville had appointed his wife and his
daughter with the same area of authority and permitted them to act
separately with no conditions.
The BC Supreme Court considered the statutory duties of an
attorney, which are specified in Section 19 of the
Power of Attorney Act, and in particular, the duty that an
attorney must act in the adult's best interests, taking into
consideration the adult's current wishes, known wishes, beliefs
and values when the attorney manages and makes decisions about the
adult's financial affairs.
The Court then examined the evidence of Mr. Sommerville's
wishes, beliefs and values as he had expressed or displayed them
while he was mentally capable. The Court found that Mr. Sommerville
would have wished for his attorneys to work together and consult
each other before making decisions about his financial affairs, and
that the daughter's action deprived the wife of her ability to
manage the family finances under a long-standing arrangement.
In the end, the Court directed that all of Mr. Sommerville's
pensions should be deposited into a bank account in the joint names
of both attorneys. The wife would continue to manage Mr.
Sommerville's finances and would be responsible for running the
joint bank account, and the daughter would be able to monitor the
use of the account. In addition, the Court directed the wife to
give priority to Mr. Sommerville's monthly personal and health
care expenses, but authorized her to use any excess pension funds
not required for his care expenses for her own expenses.
The Sommerville case illustrates the challenges that
can arise when appointing more than one attorney without specifying
the scope of their respective authorities and how to deal with
conflicts. Great care should be taken in choosing your attorneys
and in setting out their roles.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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It is not uncommon for parents to provide monetary gifts to their adult children. Parents may wish to help their child with a down payment on a property, or help pay out their child's existing mortgage.
On March 31, 2014, BC's new Wills, Estates and Succession Act1 ("WESA") will come into force. WESA introduces new protections for beneficiaries of estates that are in danger of being disputed or deemed ineffective by a court.
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