What is an Enduring Power of Attorney?

What is an Enduring Power of Attorney?

An explanation of ‘What is a Power of Attorney’ is set out here.

A ‘Power of Attorney’ is a document you can sign to appoint another person (called your attorney) to act for you in relation to your financial affairs. The document states exactly what the attorney is authorised to do.

What is an Enduring Power of Attorney?

The only difference between these two documents is that an Enduring Power of Attorney will still be operable in circumstances where the donor (the person who gives the Power of Attorney) may lose capacity.

Under a General Power of Attorney, should the donor lose capacity, then the document loses its effectiveness because in those circumstances the donor is not in a position to be able to request any activity to take place.

What is capacity?

Capacity simply refers to the competence of a person to act as principal (or in this case the donor). It can include situations where the donor/principal is in a coma, or develops dementia. In these situations the principal loses legal capacity and if there is a standard POA in place, then that would be ineffective. On the other hand if there is an Enduring POA in place it will continue to be effective notwithstanding the principal has lost capacity.

What if the principal loses capacity before executing an Enduring Power of Attorney?

The person(s) with responsibility for the principal should consider making an application to the relevant Tribunal for appointment as guardian.

Why do you need one?

If there is a risk of losing capacity in the next few years you should consider executing an Enduring Power of Attorney.

An Enduring Power of Attorney is also important for same-sex couples to ensure the intentions of the donor are properly represented by the de facto spouse.

If you would like more information about enduring guardianship and powers of attorney, call our Wills & Estate Lawyers on 9232 8033.

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