Insight

Incapacity Planning & Representation Agreements

Since 1979, citizens in British Columbia have been able to plan for an unexpected incapacity by appointing an attorney by a general enduring Power of Attorney. Such attorneys have the authority to make decisions about the financial and legal affairs of the person appointing them, and this authority continues during any subsequent mental infirmity.

A shortcoming of the general enduring power of attorney used in B.C. is that it does not extend to decision making in the areas of medical or personal care. This is one of the reasons that propelled the B.C. Government to proclaim new laws on February 28, 2000. These laws change how adults in B.C. can plan for future incapacity. It was anticipated that the general enduring power of attorney would be phased out once the new laws were in place. However, that plan has now been abandoned by the government.

The most significant of the new laws is the Representation Agreement Act (the “Act”). It creates a new legal relationship between an “adult” and a “representative” within the structure of a “representation agreement”. Under such agreements, the adult can authorize a representative to help the adult make decisions, or make decisions for the adult, about health care, personal care, and (for the time being) legal and financial affairs. The Act contains detailed rules governing both the form of the agreement and the duties of the representative.

There has been considerable controversy about the efficacy of representation agreements for financial and legal matters, and about the onerous requirements surrounding the making of a representation agreement. As a result, a report was commissioned from Professor Albert McClean of the University of British Columbia about the Act and its implications. That report contained 40 recommendations, including a key one preferring general enduring powers of attorney to representation agreements for financial and legal decision making. The B.C. Government has adopted all the recommendations and it is anticipated that new legislation will be introduced within a year to amend the Act.

For the present, Horne Coupar recommends that clients wishing to plan for incapacity ensure that they have:

  • A general enduring power of attorney for decision making for financial and legal affairs; and
  • A representation agreement for decision making in health care and personal care matters.

To learn more about representation agreements and how they interact with your living will or advance directive, see our article Planning for Health Care Decisions

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