Ruqayyah Snyder
A power of attorney is a legal document that allows an individual, known as the principal, to appoint a person or trustee (the attorney) to manage their assets and make legal, financial, and/or personal decisions on their behalf. In Australia, there are two types of power of attorney: General Power of Attorney and Enduring Power of Attorney. While a General Power of Attorney becomes invalid when the principal dies or loses the mental capacity to manage their affairs, an Enduring Power of Attorney remains effective during the principal's lifetime, even if they lose the capacity to manage their own affairs. This article will guide you through the process of creating a power of attorney in Australia, outlining the steps, requirements, and considerations to ensure your wishes are respected and your affairs are managed according to your preferences.
| Characteristics | Values |
|---|---|
| Type of Power of Attorney | General Power of Attorney, Enduring Power of Attorney, Enduring Power of Guardianship |
| Who can make a Power of Attorney | Anyone over the age of 18 with full legal capacity |
| Who can be an Attorney | A person or people, or an organisation |
| What can an Attorney decide on | Financial matters, personal matters, property matters, medical treatment decisions |
| When does a General Power of Attorney cease to operate | When the Principal dies or loses capacity to make decisions |
| When does an Enduring Power of Attorney cease to operate | On the Principal's death |
| Can a Power of Attorney be revoked | Yes, at any time while the Principal has legal capacity |
| Who can revoke an Enduring Power of Attorney | The person who made it, if they have full legal capacity; otherwise, an application can be made to the Tribunal |
| What is required to make a Power of Attorney | A form to be completed, signed in front of witnesses, and given to the Attorney, bank, and any other financial institutions the Principal uses |
| Who can provide Power of Attorney preparation services | NSW Trustee and Guardian |
| Who to contact in case of concerns about an Attorney | NSW Ageing and Disability Commission |
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What You'll Learn
Understanding the different types of power of attorney
A Power of Attorney is a legal document that appoints a person or people (the 'Attorney') to make legal, financial, and personal decisions on your behalf. There are two main types of Power of Attorney: General Power of Attorney and Enduring Power of Attorney.
A General Power of Attorney allows you to appoint someone you trust (an 'Attorney') to make decisions about financial matters for a specified period or event, such as selling your house or paying your bills while you are overseas. It is used while you can still make your own decisions and ends once you lose the capacity to do so, unless it is given as security.
An Enduring Power of Attorney, on the other hand, allows you to appoint an Attorney to make decisions about personal (including health and lifestyle) and/or financial matters. An Attorney for personal matters can only act when you do not have the capacity to make those decisions yourself. This type of Power of Attorney continues to be effective even if you lose the capacity to manage your own affairs, but it becomes invalid upon your death.
In some states, there are different forms of Enduring Power of Attorney, such as short and long forms. You can appoint more than one Attorney or require your Attorney to provide information to a trusted person. It is important to choose your Attorney carefully, as they will make important decisions for you at a vulnerable time. You should only appoint someone you trust to make decisions in your best interest.
It is also worth noting that certain pensioners may be able to access Power of Attorney preparation services for free if they meet the eligibility criteria.
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Eligibility requirements for creating a power of attorney
To create a power of attorney in Australia, you must be over the age of 18 and have full legal capacity. This means that you must understand the consequences of your actions and make choices based on your knowledge and understanding.
In Western Australia, an Enduring Power of Attorney (EPA) can be made by anyone over the age of 18 who has full legal capacity. There are different views on what constitutes 'full legal capacity', but it generally means that you understand the powers you are granting and the consequences of granting them.
In the Australian Capital Territory, a similar requirement exists, where individuals must be 18 or older and have the capacity to make an Enduring Power of Attorney. This capacity means knowing what you are doing, understanding the consequences, and making informed choices.
Additionally, when creating a power of attorney in Australia, it is important to consider the specific requirements of different states and territories. For example, if you have a New South Wales Power of Attorney and want to use it outside of NSW, you must check the requirements of the other state. Similarly, if your attorney will deal with real estate, you must register your power of attorney document with the local Land Titles Office in your state.
It is also recommended to seek legal advice, especially if your circumstances are complex or involve large sums of money. A solicitor can offer expert legal advice and ensure that all requirements are met.
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Choosing your attorney
- Trust and Understanding: The attorney should be someone you trust implicitly and who understands your values, preferences, and wishes. They should be willing and able to act in your best interests and make decisions that align with your values.
- Capacity and Competence: The attorney must have the capacity and competence to make sound decisions on your behalf. They should be capable of understanding the powers granted to them and have the ability to manage your affairs responsibly.
- Willingness to Act: Ensure that your chosen attorney is willing to take on the responsibility and agrees to act on your behalf. Remember, you cannot force someone to become your attorney against their wishes.
- Personal Relationship: Consider choosing someone who knows you well and understands your unique circumstances. This could be a family member, a close friend, or a trusted advisor.
- Multiple Attorneys: You can appoint more than one attorney, which can provide additional oversight and support. This could be in the form of co-attorneys or alternative attorneys who can step in if needed.
- Legal Advice: It is recommended to seek independent legal advice when choosing your attorney. A solicitor can advise you on the specific powers to grant and help ensure your attorney understands their duties and responsibilities.
Remember, you can revoke or change your power of attorney at any time while you have the legal capacity to do so. Therefore, if your circumstances or wishes change, you can adapt your power of attorney accordingly.
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Preparing the power of attorney document
Choose the Type of Power of Attorney
There are two main types of power of attorney in Australia: General Power of Attorney and Enduring Power of Attorney. A General Power of Attorney is typically used when you need someone to manage your affairs for a specific period or purpose, such as when you're travelling or temporarily unavailable. On the other hand, an Enduring Power of Attorney continues to have effect even if you lose the capacity to manage your affairs due to illness, accident, or mental incapacity. It is important to understand the differences between these types and choose the one that best suits your needs and circumstances.
Select Your Attorney Carefully
Choosing the right person as your attorney is of utmost importance. This person will be making important decisions on your behalf, so they should be someone you trust implicitly and who understands your wishes and values. Consider appointing someone who knows you well, shares your values, and has the ability to make sound decisions in your best interest. It is also worth noting that you can appoint more than one attorney or alternative attorneys to act together or separately.
Specify the Powers and Limitations
When preparing the power of attorney document, clearly outline the powers and limitations of your attorney's authority. Decide on the specific matters or areas where you want them to make decisions, such as financial, legal, personal, or health matters. You can tailor their authority to your specific needs and wishes. For example, you may grant them the power to pay your bills, manage your property, or make medical treatment decisions. Ensure that the document details any limitations or instructions on how they should exercise their powers.
Seek Legal Advice
Before finalising the power of attorney document, it is highly recommended to seek independent legal advice. A solicitor can provide guidance based on your unique circumstances and advise you on the powers and consequences of granting power of attorney. They can also help you understand the legal implications and ensure that your document complies with the relevant laws and regulations.
Complete and Sign the Form
Obtain the appropriate power of attorney form, which can be found on government websites or through the NSW Trustee and Guardian service. You can choose between a long and short form, depending on the number of attorneys and alternative attorneys you wish to appoint. Carefully fill out the form, providing all the necessary information. Remember that you must be 18 or older and have the mental capacity to understand the document and its implications. After completing the form, print it and sign it in front of witnesses. The witness requirements may vary, so check the specific requirements for your state or territory.
Store and Distribute Copies
Once the power of attorney document is signed, make sure to keep the original document in a safe place. Provide a copy to your attorney, and also consider giving copies to relevant institutions, such as your bank or other financial institutions. Keep a record of who has received copies to ensure proper distribution and security.
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Revoking a power of attorney
To revoke a power of attorney in Australia, the donor or principal must have full legal capacity. While mentally capable, the donor may direct their attorney to act in a particular way and may revoke the power of attorney. If the donor becomes mentally incapable, the power of attorney will continue and can only be revoked in limited circumstances.
A power of attorney can be revoked verbally, by the donor telling the attorney that their power has been revoked. However, it is important that the revocation is also made in writing by completing a "Revocation of Power of Attorney" form and providing it to the attorney. This ensures that there is a document evidencing the donor's decision to revoke the power of attorney. If more than one attorney was appointed by the donor, separate notices of revocation should be provided to each attorney.
After the power of attorney is revoked, any copies of the power of attorney within the attorney's possession should be returned, and any organisations with whom the attorney has been dealing in their capacity as an attorney should be notified of the revocation. The donor may also wish to destroy or clearly denote on the original power of attorney (or any copies) that it has been revoked.
In South Australia, if the power of attorney is a general power of attorney, there is no specific form to revoke it. However, the donor should put something in writing to make it clear that the power of attorney is revoked. There is a form available from the SA Gov - Power of Attorney website to revoke an enduring power of attorney. If a general power of attorney has been deposited with the Lands Titles Office, a written revocation should also be given to the Lands Titles Office to place on file.
In Western Australia, if the power of attorney is an Enduring Power of Attorney (EPA), the person who made it must have full legal capacity to revoke it. The revocation should be made in writing. If the person has lost capacity, an application can be made to the Tribunal to decide if the EPA should be cancelled. Additionally, if the EPA has been lodged with Landgate, a fee will be charged by Landgate to revoke it.
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Frequently asked questions
A power of attorney is a legal document that appoints a person or people (the 'Attorney') to make legal and financial decisions on your behalf should the need arise. The person that makes the Power of Attorney is known as the 'Principal'.
There are two types of power of attorney: General Power of Attorney and Enduring Power of Attorney. A General Power of Attorney is usually given for a specific period of time and becomes invalid when the Principal dies or loses the mental capacity to manage their own affairs. An Enduring Power of Attorney will continue to have effect during the Principal's lifetime, even if they lose the capacity to self-manage.
To make a power of attorney, you must be 18 or older and have the capacity to understand the document you are signing and the powers it gives. You should seek independent legal advice before completing the form and carefully choose your Attorney(s). You will then need to complete and sign a power of attorney form in front of witnesses.
