(This article was originally published in the Spring/Summer 2002 issue of Cardinal Connection, the newsletter published for clients of Cardinal Law, and has been updated.)
Representation Agreements, a new tool for pre-death estate planning, are now available for clients and their lawyers in British Columbia. A Representation Agreement is a legal document in which another person can be appointed to make important decisions in the future if you are unable to do so on your own.
You decide the scope of those decisions: they can include financial matters, lifestyle decisions (like choosing a care facility for you) and decisions to accept or reject medical treatments.
The Representation Agreement Act, which governs these agreements, permits:
The standard level version can be used by clients who have a diminished mental capacity, so long as they can still understand the nature of the appointment. This is particularly helpful for people who have, for example, early onset Alzheimer’s disease, dementia or senility. They may still be able to use a standard Representation Agreement before becoming totally mentally incapacitated.
New Agreement Bridges the Gap
Prior to the implementation of the Act, the only way you could appoint someone to make decisions on your behalf was by executing a Power of Attorney, a simple and inexpensive document that is limited to financial decisions. It has the virtues of simplicity and low cost, but offers few safeguards against abuse.
If you become incapable of managing your personal and financial affairs, another person, on your behalf, would have to make a court application to be appointed “Committee”. Then that person would have authority to make your lifestyle and financial decisions, but not decisions to refuse medical treatment. It is expensive and time-consuming, but offers several safeguards.
The Representation Agreement combines the best of Power of Attorney and Committeeship. It is less costly than a Committeeship, still provides significant safeguards and, of course, can have a wider scope.
New Agreement Provides More Benefits
A Representation Agreement provides you with more control than under a Power of Attorney over how the person chosen as your representative exercises this power. For example, a Representation Agreement can specify that your representative must consult with you before making any decision and that your wishes must be followed as instructed. If the representative cannot consult with you, he or she must do what you would have done in similar circumstances, not what he or she wishes to do.
You can also appoint a monitor – who watches over your representative – to minimize the risk of impropriety. If there is, the monitor can report this to the Public Trustee, who may conduct an investigation. If you have not appointed a monitor, the Public Trustee’s office can still initiate an investigation if your family members or friends discover an impropriety.