What is an Enduring Power of Attorney?
It is a power created by a document whereby one
person appoints another person or persons to be his or her attorney. An
enduring power of attorney will continue to operate even if the person
appointing the attorney becomes mentally incapacitated, whereas a general
power of attorney becomes null and void on the incapacity of that person.
Once appointed, what can the Attorney do?
This depends on the wording of the document. The
power may be limited i.e. to operate on a particular bank account.
Alternatively, the power may be unrestricted and the attorney is able to
sign any document which the donor of the power could have signed.
Does the appointment mean that the donor can no longer sign documents?
No. The appointment only means that an additional
person or persons can sign documents for the donor. If the donor becomes
mentally incapacitated then his or her signature will be invalid and the
attorney will need to sign all necessary documents.
What is the difference between an Enduring and a General Power of
Attorney?
A general power of attorney is valid whilst the donor
is of sound mind, whilst an enduring power of attorney is valid until the
death of the donor. Most powers of attorney are prepared as enduring
powers of attorney for the reason that most donors will want to know that
their attorney can sign any necessary documents if they are incapable of
doing so.
When does the power commence?
From the date that the donor and the attorney sign
the document unless a later date or event is specified.
Do I need to give a Power of Attorney?
If you want someone to be able to attend to your
affairs if you are unable to do so then the answer will probably be yes.
Can you give me an example of when such a power might be required?
Assume that a husband and wife have all or some of
their assets in separate names. If either of them became mentally
incapacitated or were involved in an accident and were unable to sign
documents relating to the asset in his or her name, then the other spouse
would in almost all circumstances not be able to deal with that asset
without a Court order or an administration order from the Guardianship
Board. This may be costly and time-consuming. Even where a couple holds
all their assets jointly, should one become incapacitated and as a result
the other has to sell the family home, the signatures of both spouses are
required on the transfer document. Again, a special order would be
required before the spouse who is not incapacitated would be able to sign
on behalf of their incapacitated partner.
What duties does the attorney have?
The Powers of Attorney and Agency Act, 1984
prescribes certain duties for the attorney to observe.
-
the recipient of an enduring power of attorney
must keep and preserve accurate records and accounts of all dealings
and transactions made using the power, otherwise they commit an
offence and can be fined
-
the recipient cannot renounce the power during
the legal incapacity of the donor except with the leave of the Supreme
Court
-
the attorney must exercise his or her powers with
reasonable diligence to protect the interests of the donor otherwise
he or she is liable to compensate the donor any loss suffered as a
result of such failure.
Can I change or cancel an appointment of an attorney?
Yes, at any time whilst you are of sound mind.
For more information
contact:
Tony Rice or
Joan Sedsman Return to the top |
