Is there a difference between wills, representation agreements, and powers of attorney?
Yes. All three documents are tools that give you the ability to speak your wishes at a time when you may not be able to speak for yourself, but they are three different types of documents.
A will is a legal document that records your wishes for after you pass away—it has no effect while you are alive. For example, you can decide on how your estate will be divided, who you want to take care of your children, as well as what needs to happen to your social media accounts.
A power of attorney is a legal document that you can use to give someone—your proxy—the authority to make certain decisions on your behalf. A power of attorney can be narrow (for example, your proxy can buy a house for you while you are out of the country) or broad (for example, they manage all your financial affairs). You can also put a time limit on your power of attorney (for example, one year while you are travelling).
A power of attorney is only valid while you are alive and capable of managing your own affairs, but you are choosing to have a proxy who can make certain decisions for you. It has no effect after you pass away or if you are no longer capable of managing your affairs.
If you want to give someone the authority to manage your affairs on your behalf should you become unable to do so yourself, you need an enduring power of attorney. An enduring power of attorney gives your proxy the power to make certain types of decisions for you in the future.
A representation agreement establishes rules for while you are alive but unable to express your desires or choices. This legal document focuses on your health care decisions and how you want to be cared for. A representation agreement is the most common form of advance directive in B.C.
Why should I set up these documents now?
Because you cannot predict the future or when you will actually need any of these documents. You should do it while you are healthy and capable of making decisions that are right for you.
Having these legal documents set up will give you peace of mind because you know that everything will be arranged the way you want it to be. You will also reduce stress and financial impact for your loved ones.
Make sure that your wishes are heard and followed, even when you cannot speak.
Who needs a will?
Everyone should have a will. It will enable you to
- include particular instructions for your will’s executor. consider everyone if you have a complicated family arrangement (for example, children with more than one partner).
- provide for your pets.
- make different decisions for your business than for your personal assets (often overlooked but critical—we recommend that you have a will for your personal assets and a different one for your business).
When should I update my will?
You can update your will anytime, but you should definitely do it when the law changes or after there has been a significant change in your life. For example, becoming parents, buying a house, getting diagnosed with an illness, or losing a loved one.
But even if there has been no significant change in your life, you might find that your wishes change over time. So we encourage our clients to review their will every five years to ensure that their will is still an accurate reflection of their current wishes.
What is a family trust?
A family trust is a tax planning document that can work for you during your lifetime. However, this is not a tool that is useful for everyone. The cost and administration required could be a hurdle, so discuss this with your accountant or other financial adviser first.
If you are interested, we will work closely with your accountant to create a family trust that performs for you.
Why does a will need to be probated? And how do I probate a will?
To probate a will is the process by which the Supreme Court of B.C. certifies that a will is THE will of the deceased. The process also confirms who the executor is of said will.
A probated will may be relied on by banks, land title offices, investment brokers, and others. Without a probated will, they may refuse to transfer the deceased’s registered assets (for example, bank accounts or pension plan) to the executor or the beneficiaries. A probated will is their guarantee that they are dealing with an authorized document and that they can follow the executor’s instructions.
To probate a will, you need to make an application to the Probate Registry of the Supreme Court of B.C. We are pleased to assist you with this.
How do I contest or vary a will?
A spouse or child can contest a will by making an application to the Supreme Court of B.C. under the provision of the Wills, Estates and Succession Act. You will need to have a valid basis for your claim before doing so (for example, appropriate provisions must be made in a will for each child).
We highly recommend talking to a lawyer before proceeding with a court application.
How do I make a separate will for my business?
If you own a business that either will survive you or has assets that will survive you, we recommend making a separate will for your business.
When setting up a will for your business, there is room to get creative. Every business is different, so what you need to provide for in your will depends on the circumstances of your business. In a business will, you can decide on matters such as
- who will make day-to-day decisions so that your business can continue if you pass away unexpectedly,
- who you want to run your business in the long term, or
- how to preserve your business assets to pass them on to loved ones.
Take care of your business, your employees, and your loved ones by laying out a plan now.
