Our Blog

Here you can find general information regarding some of our areas of practice......every one is different, so it is always best to get advice ensuring that all of your circumstances have been considered...

What is Power of Attorney?

A document you sign that authorizes others to sign financial documents in your name and on your behalf. (They act as your agent)This means you can be legally bound by a document they have signed even though you have not seen or signed it.The document generally authorizes the attorney to manage your financial affairs (subject to any restrictions you have stated in the document).The Power of Attorney can be limited to only doing certain things (ie. Only dealing with the sale of a property) or limited to not authorising the sale of a property or limitedin time (ie. Only while you are on holidays etc)The Power of Attorney is signed by you and (since 16.2.04) your attorney. Powers of Attorney entered into before 16th February 2004 were not signed by the attorney but are still valid despite this change.The person who gives a power of attorney is called a donor and the person(s) who receive it are called the donee(s).

How is it Created?

A power of attorney is created by signing a document that is usually prepared by a lawyer. It authorizes the person(s) named to act on your behalf. It does not need their signature. It can only be given by a person who understands the meaning of the document at the time.The attorney(s) is legally obliged to act on your directions if you are able to give any and they would be guilty of a crime if they just took your money and spent it without your authority (if you were able to understand and give that authority).

I only want it to operate when I can't manage my own affairs.

This is a common request but not easy to fully accommodate. Debate rages among lawyers as to how to deal with this. It is possible to put a condition in the Power of Attorney that says something like 'this Power shall only be valid if I am unable to manage my affairs' or ‘only to commence when my incapacity is certified by a medical practitioner’. However in practice this may be impracticable as it would mean that anyone dealing with your attorney such as a bank would have to make a judgment as to whether you were capable or the condition had been complied with. Past experience shows that they might refuse to honour the Power of Attorney for fear you would later claim you were alright and didn’t authorise the use of the document. In such cases, there would be no point in having the Power of Attorney.In my experience, most people accept the difficulty of limiting the use of the power of attorney by reference to their mental capacity. Other lawyers may disagree with the problems I foresee in trying to make it conditional upon such mental health. The difficulty is that the question won’t be tested until you have lost capacity and then won’t be able to sign another document to fix the problem. The best advice is to appoint more than one attorney and only people you trust.

Can I have more than one Attorney?

Yes, you can have any number, although more than 2 can become unmanageable. They can be authorised either:

'Jointly' which means they must both sign any document on your behalf.'Severally' which means that any one can sign - without necessarily having the consent of the others.

What is an 'enduring' Power of Attorney?

If the signing of the power of attorney is witnessed by a prescribed witness (solicitor, barrister , clerk of a local court etc) and they certify they have explained it to you, the power of attorney 'endures' through any period where you loose capacity to understand what you are doing. Without that certificate, the document ceases to be valid if you can't understand your affairs. An ‘enduring’ power of attorney is the usual type.

Can I Cancel it?

Yes, at any time (provided you have capacity)The procedure is to advise the Attorney that their authority is cancelled. To avoid claims that this was not done, it is best to serve a formal "Notice of Revocation" and register it at the Land and Property Information Office.If the Attorney does something under the Power of Attorney after notice of its revocation, this is fraud and they have committed a criminal offence.Of course, if you are unable to manage your own affairs through mental incapacity, you will not be able to cancel the power of attorney.

How long does it last?

It lasts until you either:

Cancel it. This is called 'revoking' – see above.Pass away. A power of attorney ceases to have any effect after your death.

Does it need to be registered anywhere?

A Power of Attorney can be registered at the Land and Property Information Office. The cost is about $130 to have it registered. The registration process does not require the signature of the person giving the power so it can be done at any time, even after they have lost capacityIt must be registered to deal with real estate and registration is sometimes required to deal with shares or banks.

Who may be an Attorney?

Anyone over 18 years can be your attorney. It should only be given to a person who can be completely trusted as they can do anything you can do financially such as sell or mortgage your house or operate on your bank account (unless there are limitations against this in the document). Of course, if they acted illegally by stealing your money, they could go to prison but that may not get you your money back.

My Mother has had a stroke and can't understand anything - Can I get a Power of Attorney for her?

No - a Power of Attorney can only be given by a person who understands what they are signing. If she has lost the ability to understand what is going on then she can not sign a Power of Attorney. Your only solution is to make an application to the Guardianship Tribunal to be appointed Financial Manager of her affairs.

Can’t I just get a letter from Mum giving me authority?

It is up to the organization that you have to deal with as to what authority they require. The Land and Property Information Office which controls the ownership of real estate and therefore buying and selling of houses insist on a Registered Power of Attorney. Centrelink seems to have its own form of authority and banks usually insist on a Power of Attorney but not usually a registered one. A bank will usually have a procedure to authorize someone else to sign on an account and this may solve the problem of paying bills.

Is it a Good Idea?

It is a very powerful document. It can be used to deal with all your assets. While you might trust the person you give it to, you must accept the risk that you are giving them the power to do something that is not in your best interests (such as steal your money or mortgage your home) or even if in your best interest, not what you want to happen (such as sell your home when they consider you are not able to live in it anymore).All lawyers are conscious of a case where the lawyer prepared a power of attorney for an elderly lady in favour of her daughter Unknown to the lawyer or the mother, the daughter had a gambling problem and mortgaged the mother's house to raise money to pay gambling debts. The first the mother knew was when the bank told her they were going to sell the property under the power given in the mortgage. The lady sued the lawyer claiming he didn't explain the daughter could do that. He probably didn’t state clearly that 'your daughter could mortgage your house and take the money' thinking it was an offensive thing to suggest to a mother about her daughter but it shows that you can't presume anything or anyone.You can restrict its power by conditions such as "This Power does not authorise the sale or mortgage of my house at 10 Smith St." or some similar restriction. The problem is that it may become necessary for your attorney to sell or mortgage your house to pay for entry into a nursing home or some other need that may not be anticipated. Without a crystal ball is hard to know what restrictions should or should not be imposed.

What if someone is unable to manage and doesn't have Power of Attorney?

The Guardianship Tribunal has Power to grant the right to manage someone's affairs to another or to a government body named The Protective Commissioner. The person or body appointed is called a Financial Manager. If someone is physically or mentally unable to care for themselves, an application can be made to the Tribunal for a management order. The Tribunal will look at evidence as to the person = s condition from their doctor and others. If the Tribunal is satisfied of the person’s inability to manager themselves, it will make the order. If a private individual is appointed, the Tribunal will always order that the Protective Commissioner supervise the manager's actions.