Most people want to leave their affairs in a well ordered state when they die. To this end, lawyers can help craft an estate plan which produces an easy and convenient process to dispose of property. Yet those same people often ignore an easy and convenient method to reduce the burden on loved ones during their lifetime.
Most of us expect to live long into our golden years with a sound mind and the ability to function independently. Unfortunately, this is not always the way life plays out. For example, the loss of mental capacity sometimes accompanies the aging process. Without pre-planning, something like this can severely increase the burden on other family members and drain funds from the afflicted person.
While the risk of mental incapacity increases with age, it is not age alone that carries this risk. It is wise to be prepared whether you are 18 or 82. A young and able-bodied individual could cross the street and be hit by a bus (among countless other possibilities), living but left without mental capacity for years to come. More often, however, diseases such as Alzheimer’s are the culprits which claim our capacity. In many cases, it is a terminal illness that calls this possibility to mind. In these cases, there is enough warning of what is coming to prepare and have documents executed. I have made several trips to hospital bedsides in this year alone for that specific purpose. However, I do not recommend leaving such an important consideration until incapacity is looming, especially when a sudden accident can occur instantly.
Most people are familiar with the traditional property power of attorney document which grants another person the authority to manage financial and property interests. In Saskatchewan you can also name a personal power of attorney to make personal decisions concerning your living arrangements and daily needs. (The authority to make health care decisions is not included in this document. A Health Care Directive is required to grant that authority and is not discussed in this article.)
What many do not realise is if there is no legally executed power of attorney when incapacity strikes, accounts can be frozen and loved ones left powerless to deal with assets or make decisions about the incapacitated person’s (hereinafter “Adult”) living arrangements. If there is no power of attorney, one of two things must happen: either a loved one will have to make a court application to obtain the authority the Adult neglected to give, or the Office of the Public Guardian and Trustee (“PG & T”), which is the body responsible for protecting vulnerable adults, will take control of the assets and charge a fee to do so. Fees are paid out of the Adult’s estate, reducing its value for beneficiaries.
If an Adult’s loved one wants to act on behalf of the Adult, he/she must apply to Court for appointment as the Adult’s personal and property guardian. The authority to do so falls under Saskatchewan’s Adult Guardian and Co-Decision Making Act (“The Act”). The applicant must be a nearest relative of the Adult or someone who has a “sufficient interest” in the Adult’s well-being. The applicant must also satisfy the Court with Affidavit evidence that he or she is the best person to act as Guardian. This includes describing a plan to look after the Adult’s personal care and financial well-being.
Applicants must provide a criminal background check and, in most cases, a personal bond. All applications must be served on the PG & T and while the Act gives the Court discretion to dispense with a bond where the estate is under $10,000.00, the PG & T seeks a personal bond on all applications. The applicant may also be required to provide a commercial bond in certain circumstances, such as where the applicant is resident outside of Saskatchewan or depending on the value of the Adult’s estate. This results in additional expense which is usually paid out of the estate with Court approval. Legal fees for the application are also paid out of the estate with Court approval.
Perhaps the most difficult burden facing an applicant is the need for two medical assessments from qualified professionals confirming the Adult’s incapacity. Where an Adult has had long-term care or is institutionalized with a progressive disease such as Alzheimer’s this requirement is not so onerous; the Adult’s medical doctor will often help complete the assessment and may recognize that a Guardianship order is in the patient’s best interest. Long-term care facilities often have a social worker on staff who will be familiar with the Adult’s needs and available for this purpose. If an Adult does not have a long-term family doctor or someone who is familiar with his/her mental deterioration, however, finding a medical professional who is willing to make a declaration of incapacity for the sole purpose of assisting an applicant with his/her legal application can be challenging. This is especially so where the application is contested.
To speed up the process, the applicant will want the Adult’s nearest relatives to consent to his/her appointment. There is an order of nearest relatives set out in The Act. The most common case requiring the gathering of consents is where an Adult’s child or sibling is the applicant. If the Adult is married or the applicant has siblings, the applicant must serve the application on the Adult’s spouse and his/her own siblings, since these people are presumed to be in a greater or equal position to seek guardianship. If family members are in agreement about the course of action to be taken then this is a formality and the application will probably be granted without ever having to appear in Court. Where acrimony or differences in opinion exist, however, anyone with a sufficient interest in the Adult’s well-being may submit an objection. This will require a hearing to decide if the applicant is the person truly best suited to act as the Adult’s guardian. Contested hearings of this nature are similar to contested family law applications. They can be just as hostile and just as costly.
All of the problems and costs that can potentially arise in a guardianship application can be avoided by pre-planning. The power of attorney document is a simple and inexpensive way to plan for potential incapacity. It provides loved ones with the authority to attend to your needs and ensure wishes are carried out while you are incapacitated. Without it, your loved ones will need to spend time and money making an application to acquire the authority you could have confirmed yourself. You can take that burden from them with a little thought and planning.