Power of Attorney Duties and Responsibilities in Newfoundland and Labrador

Being named as someone's attorney under an Enduring Power of Attorney feels like a compliment — they trust you with their financial life. What it actually means, in legal terms, is that you have accepted a fiduciary role with strict obligations and personal liability if you fail to meet them. Newfoundland and Labrador law does not treat this as a casual family favour.

You Are a Trustee

Under the Enduring Powers of Attorney Act (RSNL 1990, c. E-11), an attorney is a trustee of the donor's property. This is not metaphorical. The same legal standard that applies to professional trustees managing pension funds or estate assets applies to you.

The core obligation is the "prudent investor" standard: you must manage the donor's assets with the care, diligence, and skill that a reasonably prudent person would exercise in comparable circumstances. This means you cannot simply park everything in a savings account if a diversified portfolio would better serve the donor's interests, and you cannot take speculative risks with assets the donor needs for their care.

What You Must Do

Keep assets completely separate. Open a dedicated bank account for the donor's funds. Never deposit the donor's income into your personal account, never use the donor's credit card for your own purchases, and never "borrow" from the donor's accounts with plans to repay later. Co-mingling funds is one of the fastest ways to face a court inquiry and personal liability.

Maintain detailed records. Track every transaction — income received, bills paid, purchases made, assets sold — with dates, amounts, and receipts. If the court ever orders you to pass your accounts, this ledger is your defence. Without it, every unexplained gap or shortfall becomes evidence of potential breach.

File the donor's income taxes. The tax obligation does not pause because the donor is incapacitated. You are responsible for ensuring annual returns are filed, taxes are paid, and any benefits or credits the donor qualifies for are claimed.

Act in the donor's best interests. Every decision must serve the donor, not your convenience, your family's preferences, or your inheritance expectations. If maintaining the family cottage costs the donor $15,000 a year and those funds are needed for care, selling the cottage may be the correct decision — even if you hoped to inherit it.

What You Cannot Do

Make a will or change a will. An attorney has no testamentary authority. You cannot create, modify, or revoke the donor's will. This restriction is absolute in Newfoundland and Labrador.

Change beneficiary designations on registered plans. This is the RRSP-to-RRIF trap that catches many attorneys. Because beneficiary designations are considered testamentary dispositions, changing them — or inadvertently cancelling them through a plan conversion — falls outside the attorney's authority. If an RRSP must be converted to a RRIF (mandatory by December 31 of the year the owner turns 71), the original beneficiary designation may be cancelled. Consult an estate lawyer before any registered plan conversion.

Make unauthorized gifts or transfers. Do not use the donor's money to make charitable donations, give cash to family members, or pay for your children's education without clear authority and legal advice — even if the donor would have done so.

Benefit personally from the position. If payment is expected, address it expressly in the EPA or get legal advice before taking payment. You cannot use the donor's property for your own purposes. You cannot take business opportunities that come to your attention through managing the donor's affairs.

Substitute Decision Maker Duties Are Different

If you have been appointed as a Substitute Decision Maker under an AHCD rather than an attorney under an EPA, your obligations follow a different framework. The SDM must:

1. Follow the explicit instructions documented in the AHCD first
2. If the directive is silent on a specific treatment, base the decision on the patient's known values, beliefs, and prior verbal wishes
3. If the patient's values and wishes are completely unknown, make the decision that a reasonable person would determine to be in the patient's best interests

An SDM cannot consent to MAiD (medical assistance in dying) or non-medically necessary surgeries like living organ donation unless the AHCD explicitly authorizes these decisions.

Consequences of Breach

An attorney who fails to meet their fiduciary obligations is personally liable to compensate the donor for any financial loss. A person with an interest in the donor's estate, or another person permitted by the court, can apply to the Supreme Court to compel the attorney to pass their accounts — effectively a financial audit.

If the court finds that the attorney has mismanaged, co-mingled, or misappropriated the donor's assets, it can:

• Order the attorney to repay every dollar of loss
• Remove the attorney and appoint a replacement
• Refer the matter for criminal investigation if fraud or theft is suspected

The Newfoundland and Labrador Power of Attorney Kit includes a fiduciary duty log designed to help attorneys track every transaction from day one, alongside a clear reference guide to the obligations and boundaries that apply under provincial law.

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