Johnston Lawrence

Enduring Power of Attorney

28 November 2008. by Johnston Lawrence , tagged with Trusts Estates and Wills

An Enduring Power of Attorney is a formal document giving someone the power to act for you if you lose the capacity to make decisions for yourself or if for some practical reason you are unable to deal with your property. Many people think that in situations of incapacity their partner will be able to step in automatically, but that is not the case. Even if you’ve been married 50 years, your spouse will not be able to deal with any accounts, policies or possessions if they are in your name alone. They’d need to go to court to be given that power which could take months and costs thousands of dollars.

There are two types of Enduring Power of Attorney – one for your money and property affairs and the other for your personal care and welfare.

You can appoint more than one attorney for your money and property which can be activated straight away. If you do, then your attorney(s) can act for you on your instructions until you are judged as not being able to make these decisions yourself – from that point they have the power to act for you. It is advisable that a person chooses to appoint two attorneys to act “jointly but not severally”, meaning neither can act without the knowledge and approval of the other thereby providing a safeguard against fraudulent use of the power. An individual may also like to consider appointing a professional or a trustee company as their attorney as these people generally will not be in a position of conflict and will also have standards of record keeping and accounting which individuals may not.

When it comes to an Enduring Power of Attorney for Personal Care and Welfare you can only appoint one attorney to be responsible for your personal care. They must be a private individual, and their power only comes into effect if you become mentally incapable of understanding and arranging your own personal care.

Their job will be to help deal with rest homes or hospitals, medical issues, personal needs and so on.

People often choose their partner as attorney, especially for personal care and welfare. If you are single, choose a trusted relative, friend, solicitor or accountant who is healthy and likely to outlive you.

One must consider whether the attorney has the skills, judgment and time to handle your affairs. Be aware that family members may find it difficult to act impartially, or may be influenced by other relatives. Once you have appointed an attorney, avoid later misunderstandings by making sure that close friends and family members know.

A person can withdraw a Power of Attorney at any time, as long as they are mentally capable. An attorney can cancel the power at any time, though if the donor is no longer mentally capable, the attorney must notify the court of the cancellation.

Once the donor of an enduring power is mentally incapable, they cannot revoke the power without the intervention of the court, and neither donor nor attorney can extend or restrict its scope. A Power of Attorney ends when the donor or attorney dies.

This month, the Protection of Personal and Property Rights Amendment Act 2007 comes into force making the Enduring Powers of Attorney regime more robust. The legislation comes in response to complaints from people involved that the scope and nature of the Enduring Power of Attorney documents entered into were not understood at the time of the execution. The amendments now require a lawyer or legal executive to fully explain the nature and scope of the attorney relationship and to sign a certificate to that effect so that those who enter into these relationships do so on an informed basis.

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