What is a Power of Attorney?
A Power of Attorney is a formal legal document that provides an appointed person or trustee organisation with the ability and legal authority to act on your behalf and manage your assets. Unlike an Appointment of Enduring Guardian, this is for the purpose of financial and legal decisions.
Your appointed attorney will be able to do the following on your behalf:
- Sign legally binding documents
- Operate bank accounts
- Pay bills
- Buy and sell real estate
- Manage investments
- Collect rent
- … and more
A Power of Attorney can come in two different forms:
- An Enduring Power of Attorney, and;
- A General Power of Attorney.
What is Enduring Power of Attorney?
Enduring Power of Attorneys are only in function where you temporarily or permanently lose the ability to make these legal and financial decisions on your own accord whether by injury, illness or disability.
What is a General Power of Attorney?
General Power of Attorneys are used in cases where you still have the ability to make your own decisions. For example, a General Power of Attorney may be necessary where you are overseas and in the process of a sale of property.
What is an Appointment of Enduring Guardian?
An Appointment of Enduring Guardians is also a form legal document but it allows you to appoint a trusted person to make health and lifestyle choices on your behalf.
This may mean:
- Where you live
- The healthcare you do or do not receive
- The personal services you receive
- Consenting to medical or dental treatment
In this context the word enduring simply means that the appointment will continue unless revoked by yourself while you have mental capacity or by the appointee, or it is changed or revoked by the Guardianship division of the NSW Civil and Administrative Tribunal or the NSW Supreme Court.
Why do you need both?
As both documents address different decisions which would need to be made on your behalf it is important that you have both an Appointment of Enduring Guardian and a Power of Attorney.
If you only have a valid Power of Attorney, your appointee/s will not be able to make any lifestyle or health choices on your behalf.
Likewise, If you do not have a Power of Attorney in place, the guardian/s appointed under your Appointment of Enduring Guardianship will not be able to make any legal or financial decisions on your behalf should they arise.
Things to note when drafting your estate planning documents
When preparing either a Power of Attorney or an Appointment of Enduring Guardianship, it is recommended that you appoint a substitute appointee. This will prevent you from having to update these documents more frequently as it provides a backup appointee/s in the case that any of your original appointee/s revoke their appointment or are no longer able to act on your behalf. Your substitute will simply stand in their place as your replacement appointee.
If you or someone you know is looking to have estate planning documents prepared you can speak to our incredible Estates Team by calling our Sutherland office at 9525 8688 – or emailing your enquiries to wmd@wmdlaw.com.au
