Executor Powers of Attorney
Executor Powers of Attorney – The Executor’s Little Helper
Navigating the labyrinth of estate administration can feel like a daunting journey through uncharted territory, particularly given the onerous powers and duties that come with the fiduciary role of an executor and estate trustee. Powers of attorney are usually thought of as belonging exclusively to the realm of estate planning, or commercial transactions, but a limited form of powers of attorney for property (where the law permits it a given jurisdiction such as Ontario) can provide assistance to belaboured executors and estate trustees (hereafter “executors”).
Traditional powers of attorney for property are based in agency law and terminate on the loss of capacity or death of the grantor of the power. Substitute decision laws that have evolved since allow powers of attorney for property (and care) to continue after the grantor has lost capacity, but not death.
Since executors are fiduciaries and, therefore, legally prohibited from delegating decision authority to others it would seem at first blush as if they could be faced with an overwhelming burden in a complex, long-running estate. There is where an executor’s power of attorney can be a pivotal instrument to ensure that the estate administration process proceeds smoothly.
While an executor’s power of attorney does not allow the delegate to make decisions, they can carry out administrative tasks on behalf of the executor such as collecting information and communicating with specified third parties or decluttering a property (based on the executor’s instructions). The document names the delegate(s) and sets out the scope of their administrative authority as well as making it clear that the executor is still in charge of decisions.
In the current era where security and privacy concerns are paramount, as well as being subject to legal regulation, using an executor’s power of attorney can help to avoid barriers and delays that did not exist historically. Early in the author’s career, it was common for lawyers and family members to assist executors with various tasks, but this is rarely feasible today.
This specialized power of attorney does not allow the delegate to step into the executor’s shoes in the same way that a continuing power of attorney for property does under substitute decision laws, but it is a useful compromise between the executor going it alone or requiring co-executors, with the latter option posing potential challenges.
Similar to the idea of an executor’s power of attorney is the ability of executors to retain trust companies on an agency basis to perform certain administrative tasks on behalf of the executor. Both instances are based in agency law, with the difference being the method of implementation.
As with all legal instruments, the drafting of an executor’s power of attorney or agency contract should be approached with care and the delegate should obtain independent legal advice. Also, any fees to be charged for the services should be clearly set out.
In conclusion, while the executor’s power of attorney has lesser scope than a continuing power of attorney for property granted by an individual acting personally, it can still play a vital role in ensuring the timely and effective administration of an estate in accordance with the deceased’s wishes.
The above commentary is based on the laws of Ontario and those of Canada applicable therein. Persons residing outside of Ontario and Canada should consult legal advisors in their jurisdiction for information and advice applicable to them.
