Enduring Powers of Attorney
•
What is an Enduring Power of Attorney?
An enduring power of attorney allows you to appoint a person of your choice to conduct your financial and business affairs, should you become mentally incapacitated.
What happens if I don’t have an Enduring Power of Attorney?
If you do not have an enduring power of attorney and you become mentally incapacitated, your spouse, partner or any member of your family will have no power to conduct your financial or business affairs.
Who will Control my Business and Financial Affairs if I become Mentally Incapacitated and do not have an Enduring Power of Attorney?
If you become mentally incapacitated your affairs very possibly will pass to the Protective Commissioner’s Office, that is, your affairs will be managed by a government official.
A Power of Attorney is a document given by one person (the principal or donor) to another person (the attorney) which enables the attorney to act on behalf of the principal. The power can be to act generally on the principal’s behalf or to act in specified circumstances and could include the right of the attorney to sue and be sued in the place of the principal. Any mentally sound person, who is capable of understanding the effect of the document, may give a power of attorney.
By making a Power of Attorney you can give a person of your choice the power to make decisions on your behalf about your financial matters.
An “Enduring” Power of Attorney simply means that the power continues even if the person giving it loses the capacity to make decisions.
Why give someone Enduring Power of Attorney?
There are some circumstances in which you may be unable to make decisions about matters that concern you. For example, you may be overseas, or you may be too ill.
If you give someone a general power of attorney, for instance to sign documents for you in your absence, that power will come to an immediate end if for some reason you lose your capacity to make decisions. This could be very awkward if your attorney is in the process of conducting business affairs for you.
Giving someone enduring power means that he/she is able to continue to act for you if you lose capacity to act for yourself.
If your attorney will be making decisions about buying or selling land, this document must be registered with the Land Titles Office.
Any investments made by your Attorney while you lack the capacity to make financial decisions must be those that are named in the Trustee Act as investments a trustee is authorised to make.
If you have other attorneys, your attorneys must consult with one another regularly to make decisions. Joint attorneys must make decisions unanimously.
Specific responsibilities
Your attorney has a responsibility to:
· Duty to keep records. Your attorney must keep reasonable records of dealings and transactions made under the power. It is an offence not to do so, and the Court may require the Attorney to produce them.
· Duty to keep property separate. Your attorney must keep your property separate from their property unless you and the Attorney own the property jointly.
· Duty to present a management plan to get approval for unauthorised transactions. If your Attorney makes a financial decision, they must present a plan of management to the Court if the Court requires it. If your capacity to make decisions is impaired, they must also get approval from the Court for any transactions that have not been authorised under the appointment.
· Duty to avoid transactions that involve conflict of interest. Your Attorney must not enter into transactions that could or do bring their interest into conflict with your interests.
· Duty in relation to gifts. Your Attorney must not give away your property except where you would be likely to do so, for example as a marriage gift to your relation or as a donation to your favourite charity (so long as the size of the gift is reasonable in the circumstances).
· Power to maintain your dependants. Your Attorney may give reasonable maintenance to your dependants.
The principal may nominate in the document when your power to make financial decisions begins. If the principal does not nominate a date, then your power begins immediately.
Though there is no time limit on enduring power of attorney, certain actions by you, the principal or the Court can bring your power to an end.
So long as you are capable, you can withdraw from the appointment by giving your Attorney a signed notice or by getting the Court’s leave to withdraw.
Revoking your Attorney's power
You may revoke your Attorney's power at any time, so long as your capacity to make the decision is unimpaired. In other words, so long as you have the capacity to make an enduring power of attorney, you also have the capacity to revoke it.
If you revoke the Attorney's your power, you must inform the Attorney in writing.
If you complete a new document giving powers to another attorney, your former Attorney's powers are revoked to that extent. Because the new document has a later date, it overrides the first.
If you die, your enduring power of attorney is revoked in its entirety.
Your Attorney's power may also be changed or revoked by the Court if your Attorney has failed to act in your interests.
Can your Attorney be held liable?
Yes, your Attorney can be held liable if your Attorney uses the enduring power of attorney knowing that it has been changed or revoked, or knowing of an event that effectively revokes it, or even if your Attorney has reason to believe that it has been revoked.
The Court and the Adult Guardian has the power to protect your interests. Your Attorney may be required to produce a summary of receipts and expenditure or more detailed accounts, and these may be audited. Your Attorney may also be required to give evidence in relation to the exercise of powers. If the Court or Adult Guardian believes that your Attorney has not adequately protected your interests, they may be removed or your enduring power of attorney may be revoked, and your Attorney may be required to compensate you.
If you wish to obtain further information please contact our office.