As colder weather approaches, Ontario snowbirds will start flocking to warmer climates. According to a 2018 study commissioned by The Canadian Trade Commissioner Service, close to 500,000 Canadian snowbirds spend their winters in Florida. Arizona and California are also popular destinations.
Many, if not most, will arrange health insurance in anticipation of travel, but consideration should also be given to incapacity planning. Who has the authority to manage a person’s real estate assets, access financial accounts or pay bills upon incapacity? And likewise, who has authority to make health care and medical decisions on a person’s behalf?
For a power of attorney to be valid, it must comply with the legal requirements of the applicable jurisdiction. An Ontario power of attorney must be signed by the grantor in front of two eligible witnesses in the presence of each other and the grantor. By way of example, in Florida, a local power of attorney must be signed by the grantor in front of two witnesses and a notary public.
An Ontario power of attorney, even if validly executed domestically, may not be recognized in a foreign jurisdiction. If an Ontario power of attorney is not recognized in Florida, for example, and the grantor no longer has the requisite capacity to execute a local power of attorney, the grantor’s family may then be subject to court proceedings to appoint a guardian (of property or medical and health care, as applicable) or an equivalent, which can be costly and time consuming. There may be processes to validate powers of attorney in a foreign jurisdiction, but these can also be costly and cause frustration and delay.
Consider the following situations where a substitute decision maker may be needed in a foreign jurisdiction to deal with a person’s affairs, not only because it is practical, but is necessary:
1. He or she is living in his or her home in Ontario and is no longer able to travel or make use of his or her vacation home outside the country. It is now desired to sell the vacation home, including perhaps to have liquid assets to pay for full time care at home.
2. He or she is not able to manage the day-to-day responsibilities of paying bills while outside the country and needs someone to do so on his or her behalf.
3. He or she becomes ill while abroad and needs someone to make medical and health care decisions on his or her behalf, including in an emergency situation, or to arrange for him or her to come home for treatment.
4. He or she has specific health care wishes in accordance with his or her religious beliefs and it is important that they be carried out.
The examples above illustrate that it is practical and prudent to have local powers of attorney in jurisdictions in which one has assets and/or spends significant time. There are several considerations in preparing valid local powers of attorney, such as ensuring that the documents are executed in accordance with the laws of the local jurisdiction and that the power of attorney in one jurisdiction does not unintentionally revoke the power of attorney in another jurisdiction (see our advisory on multijurisdictional and separate situs powers of attorney for the mobile client).
For the Ontario snowbird who has assets or spends a significant amount of time in a foreign jurisdiction, a global approach to incapacity planning must be considered. It is important to obtain comprehensive legal advice to ensure incapacity planning needs are met wherever one spends significant time or has assets.
The comments offered in this article are meant to be general in nature, are limited to the law of Ontario, Canada, and are not intended to provide legal or tax advice on any individual situation. In particular, they are not intended to provide U.S. legal or tax advice. Before taking any action involving your individual situation, you should seek legal advice to ensure it is appropriate to your personal circumstances.