Enduring power of attorney in NSW

A power of attorney (POA) is a document that enables the person (or persons) of your choice to act in your place and do the things you would normally do yourself.

This person is known as an attorney and will be in control of your assets and finances if you are capable and/or incapable of managing your assets and finances. Your attorney can do things such as buy or sell real estate, operate your bank accounts and/or make general enquiries on your behalf.

In other words, the person you choose as your attorney has the right to stand in your shoes when you wish them to look after your legal and financial affairs.

An enduring power of attorney is a legal document that permits you to nominate someone you trust to make financial decisions on your behalf if you become mentally or physically incapable of doing so yourself.

It is the most common type of power of attorney made these days because it lasts even if you, the person giving the power of attorney, suffer unsoundness of mind.

Normally a basic POA would become invalid as soon as you suffer loss of capacity through unsoundness of mind. This is a protection given automatically by the law. If you suffer loss of legal capacity, you cannot cancel a POA you have given, so the law does it for you.

However, most people give an enduring power of attorney so that it continues to be valid after the point in time of unsoundness of mind. Such a power requires special wording, and the law requires that it must be explained to you by your lawyer before you sign.

A general power of attorney is only valid while you are of sound mind. They are usually used for a specific purpose e.g. to sell a property, or for a specified period eg. while you are overseas.

A general power of attorney becomes void if you become of unsound mind or you die, whichever occurs first.

In contrast, an enduring power of attorney continues to be valid, even if you become of unsound mind. It enables your attorney to continue to manage your assets for you, if you can no longer do so. An enduring power of attorney, unlike the general power of attorney, must be explained to you by a prescribed witness e.g. your lawyer.

If the difference between the two documents is still unclear, please give one of our team members a call.

An attorney can handle various aspects of your financial affairs, such as property management, banking, and investments. For example, your attorney may:

• Manage your bank accounts
• Manage your investments
• Pay your bills
• Buy and sell real estate on your behalf
• Collect rent for you
• Sign legal documents on your behalf

In doing the above, the attorney must manage your financial affairs responsibly and honestly, acting in your best interests and keeping records at all times.

Importantly, an enduring power of attorney in NSW cannot make decisions regarding your personal care or medical treatment.

In the past, powers of attorney were mainly used for very specific purposes. For example, if you went overseas, you could give someone your POA to handle the sale of your home.

Nowadays, POAs are more often used as a safeguard to ensure that, should the need arise, another person can step in and do the day-to-day things for you, things that we generally take for granted.

What would happen, for instance, if you fell very ill and could not even sign your name on your joint bank account where both signatures are required? Giving POA to your partner can avoid a lot of delay and anguish in this situation.

Like us, financial planners also strongly recommend that their clients grant POA so their assets are not locked up if a person lacks the legal capacity to sign documents or do other things.

Anyone who is over the age of 18, competent and willing can be appointed as a power of attorney. Preferably, it would be a spouse, child, children, lawyer, close relative or some other significant person in your life, whom you trust.

As this attorney must act in your best interests, they should know you well enough to understand your views on financial matters and respect the choices you would make.

Know that you can appoint several people as enduring power of attorney, as well as set rules as to whether they can make decisions separately or together.

You cannot wait until something happens before appointing a power of attorney because you must have the legal capacity to understand the document itself and make decisions.

If you suffer an accident, or a stroke, which leaves you unable to understand, speak, communicate, or write you don’t have the legal capacity to make decisions. Then it’s too late. A person who has suffered an irreversible health issue, such as dementia or brain damage, may be unable to give power of attorney.

If you know a person who, due to age or health problems, may be at risk of suffering dementia, a stroke or any other serious illness, it might be a good idea to talk to them about giving power of attorney before it’s too late.

If you don’t have an enduring power of attorney and become of unsound mind, and therefore unable to manage your financial affairs, no person automatically has the right to manage your assets. Not even if they are your husband or wife.

An application to the NSW Civil and Administrative Tribunal (NCAT), formerly the Guardianship Tribunal, can be made and this would usually be by a close family member (the applicant). The applicant would apply to become your financial manager. If this person is not deemed fit by the tribunal then the tribunal may appoint the NSW Trustee and Guardian (TAG) to manage your affairs.

Yes. The variations are many. You may want a power of attorney, for example, to come into effect from a certain date, or from the date you sign it. You may wish the power of attorney to come into operation only when you are overseas, or only if you suffer a loss of legal capacity.

You can set a fixed time when the power of attorney is to cease, for example when you return from that overseas holiday, or when you recover from illness.

You can appoint more than one person to act as your attorneys, either independently or together, and you can choose another person as an alternate, should your preferred person be unable to take on the task.

Yes. You can revoke an enduring power of attorney whenever you like, provided you still have the mental capacity to do so.

Only if your attorney is buying, selling or transferring real estate on your behalf.

You can place limits on how your power of attorney is to be used. You may decide that your attorney is not allowed to sign a document or do something that leads to your attorney receiving a benefit. The power of attorney may be conditional upon your doctor providing a medical certificate to state that you have suffered a loss of capacity through unsoundness of mind.

There are many ways you can draft a power of attorney, so you should discuss your options with us. Then we can prepare the document according to your requirements.

While the final document may look relatively simple, there are many legal questions to be considered to ensure it expresses your instructions clearly.

There are also technical rules under the provisions of the Conveyancing Act and the Powers of Attorney Act, about the drafting and signing of a power of attorney.

You can’t give an effective enduring power of attorney without having a lawyer explain the document to you before you sign, and the lawyer signing a certificate that he or she has carried out that task. If you draw up your own power

As well as expert advice on wills, powers of attorney and enduring guardian documents, we can advise you on deceased estates, testamentary trusts and estate planning and disputed wills.

We have disabled access at all of our offices for your comfort.

If you’re physically unable to come to our office, just call one of the members of our wills and estate planning team to make special arrangements for us to come to you.

If you’re signing a document under a power of attorney then you need to write under your signature “signed by [name of attorney] under power of attorney dated [insert date].” If the power of attorney has been registered then you need to also write the registration number.

No, an enduring power of attorney does not have the authority to change your will or any other legal documents relating to your financial affairs.

When you die, when you revoke it, or when it is terminated by the Supreme Court or NSW Civil and Administrative Tribunal (NCAT).

We will be happy to provide you with an estimate of how much your power of attorney will cost before you commit yourself. The reason we can’t set out a fixed cost is that everyone’s needs are different. Generally, we can provide you with an especially attractive package if you instruct us to prepare your will, power of attorney and guardianship documents at the same time, or if you and your partner have mutual powers of attorney, or if you’re on a pension.

As you can see, it’s vital you take the small steps required to get the full protection of an enduring power of attorney.