Enduring Power of Attorney
Most of us have an up to date Will, but how many of us have thought about who will manage our affairs if we become incapacitated.
We live in a society where we are living longer, however, as a result of having an aging population, there is a growing epidemic of those now living with Dementia or Alzheimer’s. It must be noted that not everyone who loses capacity is old, young adults can be involved in motor vehicle or sporting accidents, which could leave them incapacitated for the rest of their lives. It is therefore crucial to put in place an Enduring Power of Attorney, just in case you do become incapacitated.
By putting an Enduring Power of Attorney in place it allows you to appoint who you would like to be your attorney. By appointing someone as your attorney you are giving your attorney the legal authority to look after your financial and legal affairs and guardianship matters on your behalf in the event that you become incapacitated and are unable to care for yourself.
This means that you are entrusting your attorney to take control of your bank accounts, investments, sell any assets inclusive of property if required, and also choose where you live and who cares for you. In Victoria, for example, most nursing homes do not accept residents unless they have an Enduring Power of Attorney in place or have had a person appointed to act as their guardian by VCAT.
As your attorney is entrusted with significant power over your affairs, it is imperative you choose an attorney who you trust and who will manage your financial, legal and personal matters in a responsible manner. Most people choose a close family member or trusted friend to undertake the role of their attorney. All appointed attorneys must be over the age of eighteen years.
You may appoint more than one attorney should you wish. Attorneys can be appointed:
Jointly (the attorneys must agree on all decisions)
Severally (the attorneys make decisions separately)
Jointly and Severally (the attorneys can make decisions separately but if they are joint decisions they must all agree)
If you lose mental capacity without a Power of Attorney in place, there may be no one with the legal authority to manage your affairs. Your family would then need to apply to VCAT to have someone appointed as your Administrator and Guardian to manage your affairs and care for you. This can be a timely and costly exercise. Your Administrator would also have to report to VCAT each year. Most importantly, the person who is appointed by VCAT to manage your affairs and care for you may not be a person you would choose to undertake this role.
Disclaimer: The advice provided in this blog is of a general nature only and you should always seek legal advice relevant to your own circumstances.