Author Archives: Edward Gallagher

The Four Basic Steps to Matrimonial Property Division

Matproperty

(c) Patriot Law, 2016

When couples decide to separate and divorce, there are many issues to be dealt with.  One of these issues is how to deal with the property and debts of the relationship.

In Alberta, the legislation that deals with this for married persons is the Matrimonial Property Act.  The basic scheme involves determining the value of all property and debts, and then dividing it between the spouses.  Most property acquired during the marriage is divided equally,  (There are some exceptions, to be dealt with in another post.)

There is a simple process that we use to plan for the equal distribution of matrimonial property.  It has four basic steps:

  1. Inventory.  You start by making a list of all of the property and debts involved.  The assets include real property (your home), vehicles, bank accounts and investments, RRSPs, pensions and the like.  A business (whether a sole proprietorship, a partnership or a shares in business corporation) is also an asset.  The debts include mortgages, line of credit, vehicle loans and so on.  This first step is important, but not usually difficult.
  2. Valuation.  The next step is to take each item in the inventory and assign a value to it.  This step is important because when all of the values of the assets and debts are sorted out, we can then know the “net” value of the property (assets minus the debts) to be equally divided.  Some values will be known (for example, a savings account balance or the balance owing on a mortgage).  Some values may have to be determined, such as the value of a home or of a business owned by one of the spouses.  When the spouses cannot agree on the value to be assigned to a particular item, valuation by a disinterested third party with some relevant expertise is the best option.  Of course, there will be some expense involved in getting a valuation.
  3. Allocation.  The next step in the process of matrimonial property division is to decide what to do with each asset and debt.  There are two parts to this step.  First, you need to decide whether an asset that physically exists (such as a the home or a vehicle) will be distributed as it is (“in kind”) or whether it will be sold and converted into cash.  Second, you need to decide who gets which assets and debts by allocating them to one spouse or the other.  This includes assets that have been sold.  There may be a good reason to sell an asset and equally divide the proceeds of sale, but (contrary to the common misconception) it is not necessary (or desirable) to do this for every asset.  This part of the process allows for the most creativity by the spouses, and increases the potential for a “win-win” result: both spouses may be able to walk away with the mixture of assets and debts that is most beneficial for their future plans.
  4. Equalization.  Once you have done the allocation of the property and debts, you need to equalize any imbalance between the net amounts that each spouse receives from the allocation.  Each spouse is entitled to 50% of the net value of the property as a whole.  Therefore, if one spouse gets more than half of the net value of the property in the allocation process, then that spouse has more than he or she is entitled to.  The fix is a cash payment from the spouse who got more to the spouse who received less, in an amount to equalize them.  Here is a simple illustration.  If the net value of the matrimonial property is $800,000 in total, then each spouse is entitled to $400,000.  If the wife receives net property worth $600,000 and the husband receives net property worth $200,000 when allocating the assets and debt, then the wife will need to pay an equalization payment of $200,000 to the husband so that they both end up with their equal shares.

Overall, it has been our experience at Patriot Law that taking a methodical approach to the division of matrimonial property makes the process easier to understand and to simpler to resolve.

 

Pick any two …

455px-Project-triangle.svgMany years ago, I first heard the following:

“You can pick any two of the following: fast, good or cheap.”

The idea is that customers buying goods or services would like to have it all: high quality, delivered quickly and at a low price.

“Pick any two” reflects the reality from the perspective of the manufacturer or service provider.   Providing any combination of two of these three characteristics can be done relatively easily, but only by sacrificing the third element.  In other words:

  • You can have it delivered fast and at a high quality, but it won’t be cheap.
  • You can have it delivered fast and cheap, but it won’t be high quality.
  • You can have it delivered at a high quality and cheaply, but it won’t be fast.

A more nuanced way of looking at it is that speed, quality and price must be balanced.  If you want more of one (or two) of these elements, then the result is a trade-off against the remaining one.

We see this balancing act at play in the delivery of legal services at our firm.  Here is how we approach the problem.

Firstly, high quality is always our top priority.  Among other things, this is a function of being professionals: we simply won’t agree to provide lower quality legal services.  Of course, clients want that as well.  We’ve never had a client ask for lower quality legal advice and representation.

Our main focus is to balance the other two issues: speed and price.  We work with our clients to help them choose whether speedy delivery of services or a lower price is more important.

Our experience most often is that clients want the high quality legal services as quickly as possible.  The challenge is to identify how fast is necessary.  If the matter has to be prioritized ahead of already existing commitments to our other clients, then this means that we have to “find” the time elsewhere by reallocating our resources.  In practical terms, this means working overtime to meet the client’s needs.  This is reflected in a higher price.

Sometimes the choice is already made.  When a client comes to us with an imminent court date or a real estate transaction closing on a tight timeline, the “any two” have already been allocated.  The client receives high quality legal services quickly, but this is reflected in the price.

There are several ways to control costs for clients.

First, we can sometimes bundle some legal services together so that they are priced lower that the components would be if purchased separately.  The best example of this is in our estate planning services.  We offer bundled pricing for the most common estate planning documents: a Will, Enduring Power of Attorney and Personal Directive.

Another approach is so-called “unbundling” of legal services.  Here the lawyer and client  agree to limit the scope of the legal services being provided.  Essentially, this means limiting the quantity of what the lawyer does.  In this model of delivering legal services, lawyer and client examine the range of tasks necessary to deal with a legal problem and decide which tasks the lawyer will deal with, and which the client will handle.  This allows the client to have better control over his or her budget for legal expenditures.

Overall, maintaining high quality and getting the best balance between speed and price is our day-to-day focus at Patriot Law.

“Pre-nups”, Cohabitation Agreements and Marriage Contracts

From time to time we are retained to prepare a “pre-nup” for a client.  This term is in common use among clients, and in full it means a “prenuptial agreement” (an agreement made prior to marriage).  In practice, however, it means any agreement that a couple may wish to make to set out their rights and obligations towards each other by means of a binding contract rather than relying on the general law that applies if there is no agreement.

These agreements can cover both married and unmarried (common-law) relationships, and they can be made prior to moving in together or marriage or at some point after the commencement of the married or common-law relationship.

Like any type of contract, the goal is to establish both partners’ rights and obligations so as to provide both partners with certainty and predictability in the event of the termination of the relationship. While that does not sound very romantic, the truth is that all relationships eventually come to an end in one of three ways:

  • There is a relationship breakdown (one or both partners actively terminate the relationship because they don’t want to be in it anymore).
  • One of the partners becomes incapacitated.
  • One of the partners dies.

These kinds of agreement are particularly useful for dealing with property issues.  For example, you can use an agreement to:

  • Preserve certain property that was originally yours from claims by your partner.
  • Determine how increases in value to property will be dealt with. (Will it be shared or will an increase in value be only for the benefit of the person who is the legal owner?)
  • Determine how you will acquire new property.  (Will it be in the name of one of you or both of you?)
  • Determine how property will be disposed of during the relationship. (For example, who gets the proceeds of any sale?)
  • Determine how property will be dealt with at the end of the relationship.  (This may be different depending on whether the reason for the termination of the relationship is a breakdown, incapacity or death.)

You can also use this kind of agreement to deal with issues involving children and financial support for your partner.  For example:

  • What is the plan if you have a child or children together?  (Will one of you be staying home to raise the child?  If so, for how long?  What about the financial effect that staying home may have on the ability of that parent to earn income in the future?)
  • What is the plan if there are children from a prior relationship?  (Is the “step-parent” going to function like a parent or not?  Will he or she be expected to contribute directly or indirectly to the financial care of the child?)
  • What are the plans for work and home life?  (Will both of you be working, or will one person stay home?)
  • If there is a relationship breakdown, how will each partner support himself or herself in the future?

Finally, It is important to note that lawyers play a vital role in ensuring that any agreement of this type is binding and enforceable.  The lawyer contributes two very important things:

  • The agreement is in writing, and is both clear and comprehensive.  While clients often attempt drafting these agreements themselves, the result is rarely clear and comprehensive.  This is for good reason:  lawyers have the specialized training to identify, analyze and advise you on all of the legal issues discussed above, and many more. Normally, a lawyer is retained by one of the partners in the relationship to produce the first draft of the agreement.
  • The agreement is signed with both partners having independent legal advice before signing. Many a time I have heard clients express dismay that a second (and independent) lawyer needs to be involved.  Obviously there is some additional expense involved, but it is for the important goal of ensuring that neither party can ever say in the future, “I didn’t understand what I was signing”, or “I had to sign the agreement – I didn’t have a choice”.  Having independent legal advice on both sides effectively prevents this sort of problem from arising because it is the lawyer’s job to clearly explain and provide advice about every aspect of the agreement so that the client makes the active and informed decision whether to sign the agreement. (We’ll have more to say about independent legal advice in a future blog post.)

This blog post discusses the law in Alberta relating to these issues but it is not intended to be legal advice for any particular situation.  If you want legal advice, then meet with a lawyer so that you can get it.

(photo “DIY Prenup Photoshoot – Fort Canning Park” by Bambi Corro III is licensed under CC BY-ND 2.0)

The Roles and Responsibilities of Client and Lawyer

handshake3An effective lawyer-client relationship is based on mutual trust and respect. To have this trust and respect, both client and lawyer need to understand each other’s roles and responsibilities.  These roles are very different, but the are complementary to each other.  Here is how we see it at Patriot Law.

 

The client’s role and responsibilities

The client is the person who makes the important decision that he or she requires a lawyer for some reason.  The client hires the lawyer and gives the lawyer his or her instructions.  For example, the lawyer may be hired (or, as lawyers sometimes say, “retained”) to represent the client in a real estate transaction as buyer or seller, or a court case, or preparing a Will.

The client’s role is to make all of the important decisions in a legal matter.  For example, it is the client’s role to:

  • decide whether to enter into a contract (or to breach a contract, for that matter);
  • decide who to name as executor of the client’s Will;
  • decide whether to commence divorce proceedings;
  • decide whether to start a lawsuit, or defend against a lawsuit in which the client is named as a defendant; and
  • decide whether to settle a lawsuit, and on what terms.

In working with a lawyer, the client is responsible to do two major things:

  • make the key decisions (such as those noted above) when required; and
  • provide the lawyer with the information (and records) necessary to understand the facts applicable to the legal matter.

The lawyer’s role and responsibilities

The lawyer brings to the table legal knowledge and expertise that the client does not have have.

The lawyer’s role is to provide the client with two main things:

  • Advice as to what law applies to the factual situation that the client brings forward, how that law applies to the client’s facts and what client should do to address the legal issue or problem; and
  • If the client requests it, representing the client by taking certain actions on the client’s behalf.  This may be representing the client in a court case, where the lawyer literally speaks on behalf of the client to the Judge.  It can also mean taking a client’s wishes for how to deal with his or her estate and putting it on paper in a Will that will ensure that the client’s intent is achieved.

In working with a client, the lawyer is responsible for many things, including:

  • being knowledgeable about the law (in the areas in which the lawyer practices, of course);
  • being thorough and analytical in applying the law to the client’s factual situation;
  • being practical is making recommendations on courses of action and the consequences of those courses of action; and
  • being ethical and civil in dealing with the client as well as others such as an opposing party, the court and the public in general.

Synergy between lawyer and client

More than anything else, the key to having an effective relationship is for both lawyer and client to realize that their relationship is dynamic and requires open, effective and honest communication,  The lawyer cannot do his or her best job unless the client is forthcoming about the facts, even if they may be unpleasant or embarrassing.  On the other hand, the lawyer must help the client to understand what kinds of information or facts are important in a given case.

The best client-lawyer relationships are characterized by very effective communication. This creates the best conditions in which mutual trust and respect develop and are maintained.

There are limits on what a client can require a lawyer to do.  This will be the topic of a future blog post.

Legal services provided on a “limited scope”

When you are involvedHandshake in a legal dispute – be it a divorce, the breach of a contract or a wrongful termination from employment – the path to resolution can be lengthy. Many lawyers (and clients, for that matter)  think of legal services being delivered in this type of situation over a significant span of time, where the lawyer advises and represents the client throughout the process of resolving a dispute.  But not all clients want, or can afford, legal services provided in this way.

Some clients would prefer it if they could retain a lawyer to help with just one  aspect (or a few aspects) of their legal problem, while the client does the rest.  Alternatively, the client would prefer to actively control the conduct of the case, and determine if, when and in what circumstances legal advice or skills is necessary.   In order words, the client wants a more limited range of legal services to be provided by the lawyer.

This type of delivery of legal services is referred to by lawyers using various terms:  “limited scope” legal services, “brief legal services” and “unbundled legal services”.  The concept is that a client decides to retain the lawyer to perform only certain very specific legal services.  The client is responsible for everything else.  Another way to think of it is that a person is generally self-represented, but retains a lawyer to assist with those portions of the matter where the lawyer can most effectively assist the client, but within the client’s limited budget.

Here are just a few of the things that a lawyer can do on a limited scope basis:

  • Meet with a client to provide an initial assessment and explanation of the client’s general legal situation.  The client is obtaining an understanding of the law as it applies to his or her factual situation.
  • Write a “demand letter”.  The client uses the lawyer’s skills of knowledge, persuasion and determination to attempt to resolve a dispute at the earliest possible point.
  • Assist a client in drafting court documents.  The client is tapping into the knowledge and experience that a lawyer has in properly presenting evidence to be used in a court process.
  • Assist a client in a specific court appearance.  The client is leveraging the lawyer’s skill in advocating on behalf of the client in an environment (the court room) in which few non-lawyers are comfortable.
  • Research a point of law.  The client gets a thorough review of the law that applies to the client’s facts, summarized so that the client can thoroughly understand the law – or a part of the law – that applies to his or her individual circumstances.  This helps with effective decision-making.

It is important to note that the high degree of competence, diligence and ethical behavior required by lawyers are not reduced in any way when legal services are delivered on a limited scope basis.  All that is different is the scope – the range and duration – of the services to be delivered by the lawyer.

Not all lawyers are comfortable with providing limited scope legal services, just as not all clients are well suited to receiving limited scope legal services.  What is important to understand, however, is that it is an option that is appropriate for some clients in some circumstances.

If you think that limited scope legal services might be right for you, talk to your lawyer about it.  If your lawyer does not do limited scope work, then ask for a referral to a lawyer who does this type of work.  When enough clients start asking for limited scope legal services, lawyers will meet the demand.

At Patriot Law Group, we offer the option of limited scope legal services when they are appropriate to both the situation and the client.

 

What if you could be the bank?

moneyWe have had a large number of “private lender” transactions come through our office of late. This is what got us thinking about this blog article.

Most of us have borrowed money in the past to buy a car or a home or something else that we did not have enough cash on hand to buy outright.  Banks make money by lending money to others and charging interest on the amount loaned.

What if you could be the bank?  It’s possible and can be profitable to do so.

Here’s what it takes:

  1. Have the money to lend.
  2. Have some tolerance for risk.
  3. Identify a credit worthy borrower.
  4. Document the loan.
  5. Secure the loan.

Having the money

Of course, to lend money you need the available cash in the first place.  However, the amounts at issue are not always that large .  We have seen private mortgage loans just in the last few weeks ranging from $30,000 to $200,000.

Risk tolerance

Private loans (just like any loan) have risk attached.  The risk can be larger or smaller depending on a number of factors including:  the amount of the loan, the credit worthiness of the borrower, the availability of collateral to secure the loan, and the degree to which any collateral is leveraged.  On this last point, for example, a $50,000 secured  loan for the purchase of a property worth $200,000 is relatively lower risk than a loan equal to the value of property being purchased.  Risk is often partly addressed by assigning an appropriate interest rate.   Generally speaking, the higher the risk attached, the higher the interest rate you would expect to see. This makes sense.  If you are going to take more risk, you want a higher reward.

Credit worthy borrower

When banks or other commercial lenders grant loans, they usually go through an evaluation process to assess the credit-worthiness of the borrower.  This is a risk mitigation strategy.  The evaluation process may include doing a credit check, reviewing financial status documents, and doing a variety of other searches.  Private lenders should do the same due diligence and lawyers can assist with some of that.

Documenting the loan

One of the common mantras for lawyers is “get it in writing.”  This is no different for loans.   It is critical that loans be properly documented in writing, This is to ensure that the borrower’s obligations are clear and that the terms of the loan are clear.  In addition, if the borrower is providing collateral to support the loan, appropriate documentation in writing MUST be in place.  Lawyers can add considerable value in preparing loan documentation for you.

Securing the loan

As discussed above, one way to mitigate risk to a lender is to have the loan “secured.” This really just means that some kind of collateral is being pledged as security for the debt obligation.    If no security is pledged in support of a loan, then the lender is “unsecured.”

Being a “secured creditor” is preferable to being an “unsecured creditor.”  An unsecured creditor will generally have a higher priority of claim for the debt owed, at least in respect of the collateral pledged by the borrower.

There are many different types of security that can be provided by a borrower to a lender.  Some common examples (but not an exhaustive list) are the following:

  •  Land Mortgage.  A Mortgage charges a parcel of land (and the buildings on it) as security for a loan.  It also provides a lender with a variety of remedies in the event that the borrower does not make the required payments.  Essentially, the lender can use a court  (foreclosure) process to either sell the land, or have the land transferred to the lender, to recover the debt owed.   A mortgage is registered against title to the land.
  • Assignment of Rents and Leases.  This document relates to land also. It essentially lets the lender step in and act as the landlord, and collect any rent payments payable.  This applies when the borrower will be renting out the property, and typically  operates only when the borrower is not otherwise making the required payments on the loan.   This is usually registered (by way of a caveat) against title to the land.
  • Security Agreement.  This document charges personal (not land) property as security for the debt owed.  It can be very general in nature and charge “all present and after acquired property”, or be specific and charge specific items (such as a vehicle, mobile home, etc.). Specific property is often identified by make, model and serial number.  A security agreement is registered in the Personal Property Registry.

What if things go wrong?

Of course, borrowers do not always pay the amounts owed as planned.  Depending on whether a debt is secured or unsecured, there are different remedies available to a creditor to collect on the debt owed. Your lawyer can prepare provisions in the loan agreement and security documentation to provide effective remedies when things go wrong.

If you are planning on being a lender, or have questions about collection of a debt (secured or unsecured), please contact us. We know business and we can help.

Executors beware: new duties apply to you

Will documentOn June 1, 2015, the Estate Administration Act came into force in Alberta.

This new legislation updates and modernizes the approach taken to the administration of the estates of deceased persons in Alberta.  It is the third significant update to this general area of the law.  In 2012, the Wills and Succession Act modernized the law governing the making of wills and the default rules that apply when you die without a will.  Before that, the Adult Guardianship and Trusteeship Act was brought into force in 2019, creating a new approach to adults who have a diminished capacity to care for themselves or manage their financial affairs.

Among the most important changes in this legislation are the new duties and tasks assigned to the “Personal Representative”.  (A Personal Representative is most commonly the executor appointed by a Will.  It also includes, however, a person appointed by a Court to administer an estate where there is no Will or where a Will does not appoint an executor.)

The 3 duties of the Personal Representative are to perform his or her role:

  1. honestly and in good faith;
  2. in accordance with the intentions of the testator (the maker of a Will) and the Will, if a valid Will exists; and
  3. with the care, diligence and skill that a reasonable and prudent person would exercise in comparable circumstances where a “fiduciary” relationship exists.  (A fiduciary relationship is a relationship of the utmost good faith.)

There are 4 core tasks for the Personal Representative set out in the new legislation:

  1. To identify the estate assets and liabilities;
  2. To administer and manage the estate;
  3. to satisfy the debts and obligations of the estate; and
  4. to distribute and account for the administration of the estate.

Neither the duties nor the key tasks are new; they have been well established for many years. But they now appear up front in the legislation, in order to set clearer and more consistent expectations for the Personal Representative.

The most important new feature of the new legislation is a requirement for the Personal Representative to give written notice to certain persons even when administering an estate without a grant of probate or administration issued by a Court.  A notice is required to be given to 4 types of persons:

  1. To the beneficiaries, specifying (among other things) the gifts left to them.
  2. To any family member of the deceased who may have a potential claim against the estate because the family member has not been adequately provided for under the Will.  (For example, this could involve a family member, such a spouse, who was dependent on the the deceased at the time of death.)
  3. To a spouse, notifying him or her of rights under the Matrimonial Property Act, if the spouse was not the sole beneficiary under the Will.
  4. To persons acting as trustees or guardians for adults, and to the Public Trustee with respect to any minor who is interested in an estate.

These kinds of notices have been required for many years in estates that are being administrated through the authority of a grant of probate or administration.  The new feature is that they are now required even when informally administering an estate.

This new law has the goal of simplifying and clarifying the manner in which estates are to be administered.  However, it is also abundantly clear now that Executors will be held to the same high standard of conduct and performance whether or not the estate is being administered informally (outside of the Courts) or with a formal grant of probate.  Proceeding with legal advice is now more important than ever.

 

 

Guess who’s in charge of the government in Alberta right now?

Jim Prentice rachel notley

Alberta’s provincial election was held on May 5, 2015. It resulted in the first change in the governing party in Alberta since 1971. The Progressive Conservative party, which had formed government for the last 44 years, was defeated by the Alberta New Democratic Party.

Currently, we are in an interesting situation from a legal perspective. As of the writing of this blog post on May 13, 2015, the new premier-designate, Rachel Notley, has not yet been sworn in. Neither have any members of her cabinet.

This raises the question: Who is in charge during the period between the election and the swearing in of Ms. Notley and her team?

You may be surprised to learn that the Premier is still Mr. Prentice, and his cabinet are all still in charge of their respective ministries. These people wll remain in these positions until the new Premier and her cabinet are sworn in.

This isn’t widely advertised, but the information is still out there. Here is a screen shot of today’s Alberta.ca website home page, still showing the smiling face of “Premier Jim Prentice”.

Alberta government home page snip
Similarly, the Speaker of the Legislature is still Gene Zwozdesky (who lost his seat as an MLA in the election); in fact, he is in charge of training the new MLAs about their legislative role.

Why is this? It has to do with the separation of powers between the branches of government, and the concept of continuity.

 

Separation of Powers

First, it is important to know that the work of government is separate from the work of the legislature. Alberta’s legislature is not in session all of the time. It convenes for sessions when it has business to do. For example, in 2014, the legislature was in session for 42 days.
This makes sense, since the legislature is responsible for proposing, debating, passing and amending laws and that is not really a full time job.

The job of governing according to those laws lies with the “executive” branch of the government. As the name suggests, these people “execute” (implement) the laws. This is done through a series of Ministries responsible for particular aspects of governance. Some examples in Alberta are: Finance, Health, Aboriginal Affairs, and so on.

Each Ministry is headed by a Minister, who functions as the chief executive of that Department, and a member of the Executive Council (better known by its informal title, the Provincial Cabinet). The head of the Cabinet (formally, the Chief of Executive Council) is known as the Premier. He (soon to be she) is therefore Chief Executive of the Province.

Continuity

The work of government doesn’t stop just because an election has occurred and new people have been elected (and others voted out). Services still need to be delivered, and people still need to be in charge of decision-making.

So, a Minister in charge of a Ministry remains in change until replaced by a new Minister being sworn in.  From time to time, a Minister may resign. In such a case, the Deputy Minister (a civil servant, not an elected politician) has day to day management until a new Minister is appointed.

Little known fact:  although Mr. Prentice resigned as the Progressive Conservative Party leader and he resigned his seat as MLA, he did not resign as Premier.

My final note is that this legal arrangement is not unique to Alberta. It is the same throughout all provincial legislatures and also federally.

So, now you know who is in charge

The Duties of an Attorney

gavelNow, if you were an American you would likely think that this article is about the duties of a lawyer. But this post originates from Alberta, Canada, where the word “attorney” means something quite different.

In Alberta (like the rest of Canada) an “attorney” is a particular type of person: someone appointed in a document to make property and financial decisions on behalf of another. The document is called a “Power of Attorney”. The name suggests the nature of the document: one person (the “donor”) is granting another person (the “attorney”) the power to make decisions on his or her behalf concerning money and other types of property.

If you find yourself appointed as an attorney by one of these documents, it is important that you understand that you are subject to a variety of legal duties the moment you begin exercising your authority.

Here are a few simple rules to help you to understand the significant duties of an Attorney in Alberta:

  1. As an attorney, you are a type of trustee. Trustees are able to deal with property for the benefit of another person. Because the trustee is dealing with “other people’s money”, very strict rules apply to the conduct of the trustee, and significant penalties can apply to a person who breaches the trust.
  2. As an attorney, you must make decisions that are only for the benefit of the donor. You may only benefit someone else if the donor gives you express permission to do so. You may not benefit yourself or a person with whom you do not deal at arm’s length (such as your spouse) unless the donor gives you clear authority to do so.
  3. As an attorney, you must keep a written record of what you do on behalf of the donor, and you must keep those records for a period of at least two years after you cease to act as attorney. The purpose behind keeping records is to be able to demonstrate what you have done and how it was for the benefit of the donor.
  4. You must be prepared to account for what you have done as attorney at any time. The donor or another “interested person” (which could include other family members of the donor) can seek an accounting and a court can order an accounting. If you have kept the records mentioned in point 3, above, an accounting will be relatively simple to do.
  5. If you are exercising a Power of Attorney that comes into effect only if the donor has become mentally incapacitated, then you have a duty to monitor the capacity of the donor and you may need to stop acting as attorney if the donor recovers his or her mental capacity.
  6. While you can decline to act as attorney, if you are the attorney for an incapacitated person, you must generally decline up front and before you commence your duties. Otherwise, you have a duty to use your powers to protect the donor’ interests, and you cannot renounce your appointment without the permission of the court (usually after passing accounts).

Of course, every situation is unique. This general information will help you understand the duties of an attorney but it not a substitute for legal advice. Feel free to contact us for a consultation.

What makes the legal profession a “profession”?

court roomLawyers take pride in being members of the legal profession.  But what does that mean?  What is a “profession”, and why are lawyers considered professionals?

There are plenty of definitions of professions out there, but most of them boil down to sharing these characteristics:

  • Use of a skill and knowledge acquired as a result of prolonged training which enables a person to render specialized services.
  • A sense of responsibility to the public (society) as result of the person’s possession of the specialized knowledge and skills.
  • A sense of group identity and a system of internal (self) administration based on a body of ethics and standards of performance.

Historically, the first recognized professions were physicians, lawyers and religious ministers. Looking at the characteristics noted above, it is easy to see why this was the case.  In the case of lawyers:

  • The knowledge of the law and the skill in its application to a wide variety of circumstances to avoid or resolve problems is gained through training extending for 3 years beyond the undergraduate level, with an additional period of supervised “articling” (akin to apprenticeship) to an experienced lawyer and a lifelong commitment to continuing education and development.
  • The sense of duty to serve those in need of legal advice and representation is deeply ingrained throughout the training and services of lawyers.  This is why most lawyers provide some of their legal services on a pro bono (no fee) or “low bono” (reduced fee) basis.  (For example, at Patriot Law Group we have a long history of providing basic legal services free of charge to World War 2 and Korean War veterans.  (That is part of why we use “Patriot” in our law firm name.)
  • The group identity is maintained through our system of regulation by a Law Society (in Alberta, the Law Society of Alberta) which includes strict standards of performance and a code of ethics (the Code of Conduct in Alberta).

As society has progressed and become more complex, additional professions have been recognized.  For example, all of our lawyers at Patriot Law Group have had earlier careers as commissioned officers in the Canadian Armed Forces, part of the military profession.

Other well-recognized professions today include (to name just a few):

  • Chiropractors
  • Dentists
  • Optometrists
  • Pharmacists
  • Veterinarians
  • Accountants
  • Architects
  • Engineers
  • Professors

So, professions have a long history.  At Patriot Law Group, we take our responsibility as professionals seriously.  We regularly apply our professional experience and knowledge gained as military officers to our work as legal professionals.  We think it makes us better professionals.  It helped us define our approach to everything we do as lawyers:  Do the right thing for the right reason.