Notice to the Profession
October 01, 2000

This Alert! bulletin contains important information for lawyers on the Representation Agreement Act and on Claims against municipalities

The Representation Agreement Act

Editor's update: This Alert! was published in 2000 and amendments to the Representation Agreement Act came into force September 2011. The Alert! should be read in that context. Updated information about incapacity planning is available on the Attorney General’s website at

This Alert! highlights issues of importance to lawyers relating to the new Representation Agreement Act (the "RAA") and regulations.

The RAA came into effect on February 28, 2000. The Act allows an "adult" to give a person or persons (the adult's "representative") authority, by means of a representation agreement, to make both financial and health care decisions for the adult. The representative's authority can survive the adult's incapacity.

The government has also announced that section 8 of the Power of Attorney Act, which provides the statutory authority for enduring powers of attorney, will be repealed. The government recently extended the date for the repeal of section 8 to September 5, 2001. An enduring power of attorney (i.e. one that survives the donor's incapacity) signed before September 5, 2001 will continue to be valid after that date. As of September 5, 2001, however, it will no longer be possible to create an effective enduring power of attorney, and individuals will instead have to enter into a representation agreement as contemplated by the RAA.

Serious concerns in respect of the RAA have been identified by practitioners and, notably, the Representation Agreement Act Review Committee of the Victoria, Vancouver and Okanagan Wills and Trusts Sections of the Canadian Bar Association (B.C. Branch). Those concerns have been communicated to the office of the Public Guardian & Trustee and hopefully some, if not all, of them will be addressed by way of legislative amendment. The Attorney General recently announced that legislation will be introduced to allow a standardized form of representation agreement to be set by regulation. It is unclear whether (or when) amendments will also be made to the RAA in respect of other identified issues. Lawyers practising in this area should, of course, watch for any such amendments.

In the meantime, any practitioner who advises on matters relating to incapacity, who engages in estate planning or who counsels third parties (such as financial institutions) on how to deal with matters involving incapable persons and their financial affairs should be familiar with the provisions of the RAA and related adult guardianship statutes and should be aware of the concerns relating to the RAA, some of which are set out below.

Can you act for more than one party to the agreement?

Because a representation agreement creates a contractual relationship between the adult and the representative, the same lawyer should not advise both the adult and the representative unless the requirements set out in Chapter 6 of the Professional Conduct Handbook are satisfied.

Lawyers proposing to act for both an adult and a representative must be extremely vigilant to ensure that they do not act in a conflict. The likelihood of a conflict increases if the adult does not have full capacity, if there is a concern that undue influence may be exerted or if there is a disagreement about any aspect of the proposed agreement (e.g., the scope of the representative's authority, the representative's remuneration or responsibility for payment of the lawyer's fees).

An adult may name in a representation agreement someone to act as a monitor. The monitor's role is to oversee the representative's activities and to try to make sure that the representative complies with his or her duties. Because of the obligations imposed on monitors under the RAA, a lawyer acting for either an adult or representative should not also act for a monitor (see the opinion of the Ethics Committee in the September-October Benchers' Bulletin, enclosed in this mailing).

If the lawyer intends to act for only one party to the agreement, the lawyer should confirm to the other parties that the lawyer is not acting for them.

Execution formalities

The execution formalities imposed by the RAA and regulations are more complicated than those currently applicable to an enduring power of attorney.

The execution formalities require, for example, two witnesses to the signatures of the adult and each representative and alternate representative. The RAA limits who may act as a witness and all witnesses must understand the "type of communication" used by the adult. The representative, alternate representative, witnesses, lawyer consulted and monitor must each sign certificates in the forms set out in the regulations. The witnesses must, among other things, state that they have no reason to object to the making of the agreement within the meaning of section 30 of the RAA. In view of this requirement, it is not clear whether each witness has an obligation to independently verify whether any reasons to object exist. Lawyers should be particularly aware of this issue if asking staff members to act as witnesses.

Although the court may order that a representation agreement is not invalid solely because of a defect in the execution of the agreement, it is unclear when, and upon what basis, the court will exercise that discretion.

Section 7 agreements

The RAA contemplates two kinds of representation agreements. The first is called a standard, or section 7, agreement. It can be made by an adult who has less than full legal capacity, but the representative's authority must be limited to the "routine management" of the adult's financial affairs and the agreement can only give limited decision-making authority in respect of health care matters. The capacity test applicable to section 7 agreements and the definition of "routine management" are both problematic.

A lawyer who prepares a representation agreement must assess the capacity of the adult for whom the document is prepared. If the lawyer believes that the adult does not have the requisite capacity, the lawyer should not participate in the preparation or execution of the agreement.

It seems clear that something less than full capacity is required to make a section 7 agreement. Section 8 of the RAA, however, provides only limited guidance as to what degree of capacity is in fact required to make a section 7 agreement.

A section 7 agreement may provide for the representative to make decisions about the "routine management" of an adult's financial affairs. "Routine management" is defined, to a degree, in section 7(b) of the RAA and in the regulations. Lawyers should take care when preparing agreements and when advising representatives (and third parties who deal with them) as to the limits of the authority granted by a section 7 agreement. If a representative acts outside the permitted scope of his or her authority, that act may be ultra vires.

Section 9 agreements

The second kind of representation agreement is an enhanced, or section 9, agreement. It is comparable to an unlimited enduring power of attorney in terms of the scope of authority that may be granted to a representative in respect of the adult's financial affairs. A section 9 agreement can only be made by an adult who understands "the nature of the authority" given to the representative and "the effect of giving it to the representative." This test is similar to that which is now applicable to enduring powers of attorney.

Section 9(1)(i) of the RAA provides that an adult may authorize a representative to "undertake any other specified task, or make any other specified decision, that is not prohibited by law." Because of the adjective "specified," some practitioners are of the view that it may be necessary to draft a detailed "laundry list" of powers to be given to a representative, rather than to simply provide that the representative has authority to do everything that an adult can authorize an attorney or agent to do as a matter of law.


Lawyers may occasionally be asked to advise monitors or possibly to act as monitors under a representation agreement. Section 20 of the RAA sets out the duties and powers of monitors. Section 25 provides that a monitor is not liable for any act or failure to act of a representative if the monitor acts honestly and in good faith and exercises the care, diligence and skill of a reasonably prudent person. Nevertheless, lawyers considering acting as monitors should assess the time commitment required to meet the duties imposed on monitors and the potential for claims for failure to satisfy those duties.

It is unclear whether a person is entitled to be remunerated for acting as a monitor.

Anti-delegation rule

Section 17 provides that a representative may retain the services of third parties to assist the representative in carrying out his or her duties. However, section 16(6) expressly prohibits the representative from delegating any authority given to the representative by the agreement. This may mean, for example, that a representative could not invest in mutual funds or open or continue a discretionary investment account, whether or not it would be in the best interests of the adult to do so. This anti-delegation rule has important implications for representatives and the third parties who deal with them, such as financial institutions.

It is unclear whether an adult may "opt out" of the anti-delegation rule by expressly permitting the representative to delegate. Some practitioners have expressed a concern that purporting to "opt out" may not only be ineffective but may invalidate the entire agreement in view of the statutory prohibition on delegation.

Duty to consult

Sections 16(2) to (4) require a representative to consult with the adult about the adult's current wishes and, if "practicable," comply with any wishes expressed by the adult. These provisions are also potentially problematic. For example, section 16(2) requires the representative to consult with the adult "to the greatest extent possible." It is unclear whether this means that the representative must consult with the adult on every decision, no matter how minor the matter and irrespective of the adult's ability to participate in that decision.


In view of the concerns identified in respect of the RAA, some practitioners are continuing to recommend enduring powers of attorney for asset management (which remains an option until September 5, 2001), and are recommending representation agreements only for health care decision-making.

Practitioners should:

  • carefully consider all of the provisions of the RAA and regulations before preparing representation agreements, attending on their execution or advising as to their validity, nature or effect; and
  • watch for any amendments to the RAA, its regulations and related enactments.
Editor's note: The following contact information was updated in January 2012.

Please direct questions or comments on the RAA to Marlon Song and Megan Swail at the Lawyers Insurance Fund.

Resources on the RAA

For lawyers interested in learning more about the RAA and related adult guardianship legislation, here are some useful resources:

The Continuing Legal Education Adult Guardianship course materials (February, 2000). Also see Q & As from the course, posted on the CLE website (

The Public Guardian and Trustee website (

Annotated 2000 British Columbia Representation Agreement Act, Adult Guardianship Act and Related Statutes by Professor Robert M. Gordon and others (Toronto: Carswell, 2000)

Financial and Estate Planning for the Mature Client in British Columbia: Contributing editors, Fiona Hunter and Hugh McLellan (Markham: Butterworths, 2000).

Claims against municipalities

The Lawyers Insurance Fund regularly receives claims and potential claims relating to the two-month notice and six-month limitation provisions that govern claims brought against municipalities under the Local Government Act RSBC 1996 c. 323 (formerly the Municipal Act).

Sections 285 and 286(1) of the Local Government Act provide:

285 All actions against a municipality for the unlawful doing of anything that

(a) is purported to have been done by the municipality under the powers conferred by an Act, and

(b) might have been lawfully done by the municipality if acting in the manner established by law,

must be commenced within 6 months after the cause of action first arose, or within a further period designated by the council in a particular case, but not afterwards.

286 (1) A municipality is in no case liable for damages unless notice in writing, setting out the time, place and manner in which the damage has been sustained, is delivered to the municipality within 2 months from the date on which the damage was sustained.

Based on the claims experience of the Lawyers Insurance Fund, there appear to be three primary reasons why these two provisions are not adhered to:

1. Confusion over when the six-month limitation applies

A common theme running through the insurance reports is that some lawyers are assuming the six-month limitation does not apply to a negligence claim against a municipality. Recent decisions from the B.C. Supreme Court have introduced uncertainty as to when negligence by a municipality is determined to be an unlawful act contrary to statute (triggering the six-month limitation) as opposed to a breach of a duty of care in tort (triggering the two-year limitation in the Limitation Act).

The Court has applied the six-month limitation to claims against municipalities for alleged negligent building inspection The most recent example is Gringmuth v. The Corporation of the District of North Vancouver 2000 BCSC 807. This decision is currently under appeal (hearing date May 1, 2001), and it is anticipated that the B.C. Court of Appeal will clarify the scope of the six-month limitation.

Pending a determination from the Court of Appeal on the ambit of the six-month limitation period, it would be prudent for lawyers to commence action within this shorter limitation for any negligence claims against a municipality.

2. Lack of knowledge

Some lawyers are simply unaware of the two-month notice requirement or the six-month limitation. Although these provisions may not appear complex, they require some specific knowledge or experience that may be outside that of a general practitioner unfamiliar with suing municipalities.

3. Failure to appreciate that a municipality is a necessary and proper party to an action

If lawyers do not thoroughly examine the facts or determine the relief available at the outset of the retainer, it may be too late to meet the notice and commencement requirements.

* * *

Please direct questions or comments on municipal limitations to either of the following Claims Counsel at the Lawyers Insurance Fund:

Stuart Cameron; (604) 443-5764;

Ian D. Maclaren; (604) 443-5765;