Enduring Power of What and Appointments of Who? – Estate Planning Part Three
Do you know what happens when you don’t organise your Enduring Power of Attorney, or Appointment of Enduring Guardianship, before you need them? These documents play separate, but almost co-dependant roles, which are easily confused.
What is an Enduring Power of Attorney and why do I need one?
An Enduring Power of Attorney is a document which allows you to appoint a person (or more than one person) to control your legal and financial affairs. This includes things such as managing bank accounts, paying bills, selling your home, or even taking legal action on your behalf if it is in your best interest to do so. That power can commence immediately after you sign the Power of Attorney, or after a doctor assesses that you can no longer do these things yourself.
If you lose capacity due to illness or accident before you execute a valid Enduring Power of Attorney, you will not have anyone with the legal authority to manage your financial and legal affairs. This can mean that any money you have cannot be accessed and your bills may go unpaid.
In order to obtain authority to deal with your financial affairs, a relative or other person would then need to apply to the Guardianship Division of the NSW Civil & Administrative Tribunal (NCAT). They would need to seek an Order appointing them as your financial manager. In some cases, the Tribunal may not appoint the person/s you would have chosen had you been able to do so. Further, obtaining an Order for appointment can take months if your family cannot agree on the best course of action. There are also limited circumstances where the Tribunal can make such an order, some of which are dependent on a guardianship order being applied for or made.
What is an Appointment of Enduring Guardian and why should I get one?
An Appointment of Enduring Guardian allows you to choose a person (or more than one person) who can make decisions on your behalf in relation to your health and lifestyle when you can no longer do this.
The types of decisions may include:
- deciding where you live;
- what sort of healthcare or other services you receive; and
- consenting to medical and dental treatment.
An Appointment of Enduring Guardian is only effective if you do not have the capacity to make those decisions, for example, due to dementia or other health problems.
If you are in need of a guardian and do not have one appointed under an Appointment of Enduring Guardian, then a relative or other person will need to make an application to NCAT for a Guardianship Order so they can be appointed your guardian. Again, this process is not always straight forward, and can take some time. The Tribunal will require evidence of the need for a guardian such as a report from your medical practitioner and what decisions require an order to be made.
So, what are the key points?
Making a Power of Attorney and Appointment of Enduring Guardian while you have capacity ensures that:
- you are in charge of your own care to the greatest extent possible;
- you can ensure the most appropriate person/s are appointed to make financial and health decisions on your behalf; and
- if you become unwell, your family will have direction about making decisions on your behalf.
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