Difference Between Power of Attorney and a Representation AgreementOct 16 2018
Two documents that should be included in your estate planning package are a power of attorney and a representation agreement. While your will comes into play after you pass, a power of attorney and representation agreement are for use during your lifetime. Both are important should you become ill or incapacitated, leaving you unable to make decisions for yourself or requiring assistance from others. Both documents are binding and recognized by the courts: they direct medical, financial and legal professionals and the person(s) you appoint to carry out your requests and act on your behalf in the event you are not able to do so yourself.
Power of Attorney
A power of attorney allows you to appoint someone to handle your legal and financial affairs. It may be limited and dependent upon the occurrence of a certain event or usable for a set amount of time but, most commonly, it will be what is called an enduring power of attorney, which allows someone to assist you with all your legal and financial matters for the foreseeable future and will continue through incapacity on your part. You may revoke a power of attorney at any time, unless you are incapable of doing so.
(A) Limited Power of Attorney
A limited power of attorney gives the person you appoint as your attorney conditional or restricted powers to act on your behalf only in the occurrence of a particular event or for a set period of time. You may wish to use a limited power of attorney for convenience purposes. For example, if you are going out of town and anticipate legal or financial matters arising while you are away, you can appoint someone to deal with those matters during that time but have their role as your power of attorney end once you return home.
(B) Enduring Power of Attorney
The more commonly-used power of attorney is an enduring power of attorney, which allows you to appoint someone to deal with legal and financial matters on your behalf and continues through any incapacity on your part. It has no specified end date and will indicate that it continues despite incapacity on your part. This means that if you are ill, injured or otherwise incapable of dealing with your affairs, someone will be able to step in and manage things on your behalf. Significant difficulties can arise if you do not have an enduring power of attorney and you become incapacitated, as no one will have the authority to manage with your affairs. In that case, someone will need to be appointed to do so, which typically requires an application to the BC Supreme Court for the appointment of a committee. This can be avoided with proper planning and preparation.
A representation agreement is similar to a power of attorney but allows you to appoint someone to deal with personal, medical, and health care matters if you are unable to do so yourself. It allows you to state who will be able to make personal and health care decisions for you if you become incapable of doing so. You can also include specific personal or health care wishes in the agreement. Without a representation agreement, you will not be in control of who will help you or who will be able to make personal and medical decisions on your behalf.
RDM Lawyers’ Will and Estate experts