Monday, July 25, 2011

Compensation for an Attorney Appointed in an Enduring Power of Attorney

On September 1, 2011, amendments to the Power of Attorney Act in British Columbia will come into effect.

One of the new provisions, section 24, sets out the requirements for an attorney acting under an enduring power of attorney to be paid for his or her time and effort. Section 24 will provide as follows:

Payment and expenses of attorney
24 (1) An attorney must not be compensated for acting as an adult's attorney unless the enduring power of attorney expressly authorizes the compensation and sets the amount or rate.

(2) An attorney may be reimbursed from an adult's property for reasonable expenses properly incurred in acting as the adult's attorney.
Before this provision was passed the Power of Attorney Act did not set out any provision for payment of an attorney. I suspect most of the time when someone has appointed a family member as an attorney under an enduring  power of attorney, there is no provision for fees. Some people give enduring powers of attorney to trust companies, and trust companies often have fee agreements setting out their fees if they later act under the enduring power of attorney. Before September 1, 2011,  fee agreements were usually separate documents.

After September 1, 2011, the enduring power of attorney will need to set out the amount or rate of any compensation the attorney charges.

But the Power of Attorney Regulation will grandfather compensation arrangements in respect of powers of attorney signed before September 1, 2011 if the power of attorney provided for compensation (but did not set the amount or rate), or if there were a separate compensation agreement signed by the person granting the power of attorney.

I am not sure what the rationale is for requiring that the rate or amount be set in the power of attorney itself, as opposed to in a separate agreement. It strikes me as an unnecessary intrusion into private arrangements. If the enduring power of attorney is registered in the Land Title Office, then the compensation arrangement becomes a public record.


Paul McLaughlin said...

I suppose the answer for someone who has real estate and doesn't want the compensation made public is to have two EPAs, one restricted to real estate for registration at the LTO that is silent about compensation and one for general purposes. Complete privacy will be impossible because the EPA will have to be shown to 3rd parries to carry out transactions. A strange law.

Stan Rule said...

That's a good idea.