Enduring Powers of Attorney

Tuesday November 1, 2011

Frequently Asked Questions

  • What is an Enduring Power of Attorney?

There are two types of Enduring Powers of Attorney: one which relates to personal care and welfare and one which relates to property.
An EPOA is a legal document by which a person (known as the "donor") appoints a trusted person, (known as the "attorney") to carry out certain functions and make decisions on behalf of the donor.

  • What is the difference between a "normal" power of attorney and an Enduring Power of Attorney?

As the name suggests, an Enduring Power of Attorney continues beyond the point where the donor loses capacity, whereas a "normal" or standard power of attorney ceases when a person loses capacity to make their own decisions.

  • Do I need an EPOA for property and an EPOA for personal care and welfare?

You can decide to enter into only one or the other of these documents, but generally people put both in place at the same time.

  • Does the same person have to be my attorney for property and my attorney for personal care and welfare?

No. In some cases people want their attorney to be the same for both, but in other cases it is appropriate for different people to hold the different powers.

  • What is the difference between a "normal" power of attorney and an Enduring Power of Attorney?

As the name suggested, an Enduring Power of Attorney continues beyond the point where the donor loses capacity, whereas a "normal" or standard power of attorney ceases at the point of time where a person loses capacity to make their own decisions.

  • Who should I appoint as my attorney?

There is no simple answer to this question and careful consideration will need to be given. It is important that you have the utmost faith in your chosen attorney that they will carry out their duties and make decisions in your best interest and in accordance with your wishes if you were unable to make these decisions yourself. For most people they look to appoint their spouse or potentially one or a number of their children, although this is not always appropriate and trusted friends or other family members may be considered.

  • Who should I not appoint as my attorney?

If you do not have the confidence that the person will always look after your best interests you should not appoint that person. You should not appoint a person who you do not have confidence in, a person who does not have appropriate financial skills, a person who does not display good management of their own affairs, and although it is not strictly prohibited, we would suggest that you do not appoint anyone with a criminal record, who has their own mental capacity issues, who is not compatible with anyone else you may appoint as an attorney or has addictive tendencies or actual addictions.

  • Can I have more than one attorney?

In relation to personal care and welfare, you may only have one attorney who has the power at any one time. However, you may appoint successor attorneys who step in if the first person is no longer able to act as your attorney.

In relation to property, you may have one or many attorneys appointed at the same time and you may choose that they have to act jointly and make all decisions unanimously, or that any particular one of them has full powers to make decisions by themselves. Again you may appoint successor attorneys in relation to property.

  • Are there any legal requirements for the attorney?

Yes, the attorney must be at least 20 years of age at the time of signing the document, not bankrupt and not subject to any order pursuant to the Protection of Personal Property Rights Act. There are corporate entities who can be appointed if you do not have an appropriate individual in mind.

  • Need the attorney apply to all of my property or personal care and welfare matters?

No, you may appoint an attorney with limited or specific powers if you do not wish to give them control over all matters.

  • If I have appointed an attorney in relation to my personal care and welfare, can they force me to go into residential care?

No. While you have your capacity, you retain ultimate control over your personal care and welfare matters and the attorney in relation to personal care and welfare only gets to make decisions if it is established that you have lost your own capacity.

  • Is there a test for whether I have or have not got my own capacity?

Yes there is and this test generally has to be carried out by a registered medical practitioner.

  • Can I specify who carries out this test?

Yes you may specify and in some cases people want a particular class of medical practitioner or indeed their longstanding family doctor to make that assessment. However, if you do specify a specific person it may cause complications if that doctor is no longer available when the assessment is needed. Most people opt for a general practitioner to make the assessment as they believe this gives them adequate protection.

  • What obligations does my attorney for property owe to me?

Your attorney's paramount consideration when you are mentally incapable is to use your property in the promotion and protection of your best interests, while seeking at all times to encourage you to develop your own competency to manage your own affairs in relation to your property.

  • When does the Enduring Power of Attorney in relation to property take effect from?

You may choose for the power to take effect from the date of signing or that it only takes effect in the event that you lose mental capacity. There are advantages and disadvantages in each approach which you can discuss with your advisers prior to signing.

  • Does my attorney have to consult with anyone else?

Yes, your attorney is obligated to consult with you whilst you retain your capacity. If you have appointed different attorneys in relation to property and personal care and welfare, then these attorneys must consult with each other before reaching any decision. You can also impose a requirement on your attorney to consult with other people, such as family members, before making any decisions and indeed require them to provide financial information to other people if it is requested.

  • Can I revoke the power granted under an EPOA?

Yes. Whilst you have your own capacity, you may revoke the power of attorney by notice in writing to the attorney themselves.

  • How much will it cost to put in place EPOAs?

This will depend on which documents you put in place, who you appoint (as this has a bearing on the need for further independent advice), and other factors. Generally the cost of putting an EPOA in place can range between $300 to $600 plus GST.

  • When do I need an EPOA?

It is difficult to foresee when exactly a power of attorney might be necessary and therefore most people put them in place well in advance of any suggestion that they may lose their capacity. Often this is later in life, however, it is not uncommon for people of all ages to have EPOAs as capacity could be lost at any stage due to accident or the likes of a stroke. It is also usually a requirement of a Licence to Occupy (for a retirement village) for you to have EPOAs.

If you require any further information or would like to discuss your particular circumstances, please do not hesitate to contact one of the team at Holland Beckett.

Note to Reader: The information contained in this factsheet is general information only, and does not constitute specific legal or other professional advice and should not be relied on as such. Readers should obtain specific advice before making any decisions or taking any action based upon information contained in this factsheet.