Enduring Power of Attorney

An enduring power of attorney is an effective way to protect your best interests

A regular power of attorney can enter into contracts, manage property and make other decisions regarding your financial affairs and Estate Planning. Once a power of attorney is appointed, (which can be more than one person) they have the exclusive power to represent a person, company or body corporate. However, only an enduring power of attorney can ensure your best interests are carried out if you should lose the mental or physical capacity to make your own decisions.

An enduring power of attorney is a legal agreement that allows someone to appoint a person or group to make financial and property decisions on their behalf. The appointed enduring power of attorney can only act and continue to operate if the appointer loses full legal capacity.

Appointing an enduring power of attorney is an effective way to further solidify the future safety of your legacy. They are an important, practical and legal safeguard that not only provide peace of mind – but also help you avoid expensive and complex legal problems.

If you were to lose the capacity to make decisions without an enduring power of attorney or guardian in place, then such decisions regarding your Will, property, lifestyle and medical treatment could end up being made by an unsuitable person. Alternatively, such control may be determined by a tribunal.

The following real-life example shows why it’s critical to understand the differences between a power of attorney and an enduring power of attorney:

A father had been facing serious health problems for a number of years. He decided to give his daughter “power of attorney” so that she could act on his behalf in case he took a turn for the worse. After a severe stroke he was no longer physically and mentally capable of looking after himself.

Assuming she could still act as “power of attorney”, his daughter decided to sell her father’s home and move him into a nursing home as he now needed full time care. The daughter presented the property sales contract to her lawyer. After her lawyer had reviewed the contract, he informed her that she had no legal authority to sign it.

In shock, the daughter asked her lawyer why she was not able to act in the best interests of her father. The lawyer went on to explain that while her intentions were logical and honourable, the “power of attorney” given to her was ineffective and she could not act on her father’s behalf.

A “power of attorney” is effective while somebody is in charge of their faculties but if they lose their capacity to act through physical or mental incapacity then a “power of attorney” is rendered useless. Only an “enduring power of attorney” can act on a person’s behalf if that person loses their physical and mental capacity.

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