What Happens If You Don't Have An Enduring Power Of Attorney?

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A Guide To Enduring Powers Of Attorney
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Enduring Powers Of Attorney
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What Happens If You Don’t Have An Enduring Power Of Attorney?
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Trusts And Estates – Delegating By Power Of Attorney

 

What Happens If You Don’t Have An Enduring Power Of Attorney?

The Protection of Personal and Property Rights Act 1998 (often referred to as the “PPPR Act”) provides legal means to assist people who are or who become no longer mentally able to take care of their affairs.

One way the PPPR Act does this is by providing that people can sign Enduring Powers of Attorney (often referred to as “EPAs”) which appoint someone to manage their affairs in the event they become incapable of making decisions for themselves.  An EPA is similar to an ordinary Power of Attorney but whereas an ordinary Power of Attorney ceases to have effect if the donor loses mental capacity, an EPA continues to be valid after the person appointing the attorney has lost capacity.

It is always prudent to plan wisely for the future and to have EPAs in place should a change in circumstance, such as illness, accident or ageing, impact on your ability to make decisions.  However, if a person has already lost the ability to make decisions for themselves, then it is too late for them to sign EPAs and it falls to someone else, such as a relative or a social worker, to apply to the Family Court for someone to be appointed – a welfare guardian or property manager – to make decisions for them.

A welfare guardian is a person appointed by the Family Court to make decisions about the personal care and welfare of the incapacitated person.  In making decisions regarding the welfare of the incapacitated person, the welfare guardian must always try to encourage the incapacitated person to act on their own behalf and must consult with the incapacitated person where possible.

There are certain things a welfare guardian cannot do, such as make a decision for the incapacitated person with respect to getting married or entering into a civil union, or getting divorced or ending a civil union, or refusing to allow the incapacitated person to have standard medical treatment that is intended to save their life or prevent serious damage to their health.

The other type of order that can be made by the Family Court is an order appointing one or more property managers for a person who is unable, partly or completely, to manage their own affairs.

Property managers make decisions about what to do with the incapacitated person’s property.  Property managers can run a business, buy or sell property (up to $120,000 and more if the Court allows), give up to $5,000 to charity if the incapacitated person would reasonably have expected to give to charity (and more if the court allows), and bring or defend court proceedings.

As with welfare guardians, a property manager must encourage the incapacitated person to manage their own affairs where possible and must consult with the person, and with others who the manager thinks could give competent advice, about managing the incapacitated person’s property.

For specialist assistance and advice concerning orders under the PPPR Act, contact Cathy Fisher at Fortune Manning.

For Enduring Powers of Attorney, contact Tony Fortune or Lauren Corbett.

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