A Canadian Letter of Authority is a formal written document through which one person (the grantor or principal) authorizes another person (the agent or authorized representative) to act on their behalf in specific, limited matters with third parties such as banks, insurance companies, government agencies, or utility providers. Unlike a Power of Attorney, which is governed by provincial legislation such as Ontario's Substitute Decisions Act, 1992 (S.O. 1992, c. 30) or British Columbia's Power of Attorney Act (R.S.B.C. 1996, c. 370), a Letter of Authority is a less formal instrument that relies on Canadian common law agency principles.

Under Canadian common law, an agency relationship is created when one person (the principal) manifests assent to another person (the agent) that the agent shall act on the principal's behalf and subject to the principal's control. A Letter of Authority serves as the principal's written manifestation of this assent, defining the specific scope and limitations of the agent's authority. Canadian courts recognize both actual authority (expressly granted by the principal) and apparent authority (reasonably believed by third parties to exist).

The letter does not constitute a Power of Attorney under any provincial statute and does not authorize the agent to execute deeds, enter into contracts, transfer real property, or make healthcare decisions. If the authority involves access to personal information, the provisions of the Personal Information Protection and Electronic Documents Act (PIPEDA, S.C. 2000, c. 5) and applicable provincial privacy legislation (such as Alberta's PIPA or BC's PIPA) must be observed.

For dealings with the Canada Revenue Agency (CRA), a Letter of Authority may not be sufficient — the CRA generally requires its own authorization forms (Form T1013 for individuals or Form RC59 for businesses) to authorize a representative. Similarly, Canadian chartered banks regulated under the Bank Act (S.C. 1991, c. 46) may have their own proprietary authorization forms that they prefer or require in addition to a general Letter of Authority.

A Letter of Authority is commonly used in Canada when an individual needs someone else to handle specific administrative matters on their behalf. Common scenarios include authorizing a family member to make inquiries about a bank account at one of the Big Five banks while the account holder is traveling or hospitalized, permitting an accountant to obtain records from the CRA, enabling a lawyer to communicate with an insurance company about a claim, or allowing an employee to collect documents from a provincial government office.

Business owners use Letters of Authority to authorize employees, accountants, or lawyers to interact with provincial business registries, municipal offices, or federal agencies such as the CRA, CBSA (Canada Border Services Agency), or Innovation, Science and Economic Development Canada. In real estate matters, a property owner may authorize a management company to interact with tenants, contractors, or municipal authorities on their behalf.

Elderly individuals may use Letters of Authority to enable trusted family members to manage utility accounts with providers such as Hydro, handle correspondence with Service Canada regarding CPP or OAS benefits, or communicate with financial institutions about routine account matters. Estate executors may use Letters of Authority to interact with financial institutions and government agencies when administering a deceased person's estate.

The letter is particularly useful where the full formality of a notarized Power of Attorney is unnecessary or disproportionate to the task. However, for significant legal or financial actions — such as selling property, managing investments, or making healthcare decisions — a formal Power of Attorney prepared under the applicable provincial legislation is required.

The grantor's identification must include the full legal name, address, phone number, and email. The agent's identification must include the full name, address, and relationship to the grantor. These details enable the third party to verify identities and assess the reasonableness of the authorization.

The scope of authority is the most critical section and must describe with precision exactly what actions the agent is authorized to perform. Under Canadian common law agency principles, an agent has authority only within the scope granted by the principal. Vague language may cause organizations to refuse to honor the letter. The scope should specify both what the agent IS authorized to do and any explicit limitations.

The duration section specifies whether the authority expires on a specific date, continues until a task is completed, or remains in effect until revoked. The revocation clause confirms the principal's right to revoke at any time by written notice. Under Canadian law, revocation takes effect when the agent and third party receive notice, and third parties acting in good faith before receiving notice are protected.

The identity verification section specifies acceptable Canadian identification documents (passport, provincial driver's licence, provincial photo ID card). The limitation clause must explicitly state that the letter does not constitute a Power of Attorney under provincial legislation and does not authorize the agent to execute deeds, make healthcare decisions, or transfer property. The PIPEDA reference is important for any authority involving personal information. The governing law clause should identify the applicable province and reference both provincial and federal laws of Canada.