Powers of attorney Q&A
What happens if you have an accident or become ill and are unable to make decisions for yourself? Who will decide what happens to your money, your housing and health care? It’s important to plan for your future. One of the ways you can do this is by making a power of attorney. We sat down with legal expert Rachael Grabovic from Rigby Cooke Lawyers to explore some common questions about powers of attorney.
1. What is a power of attorney?
Powers of attorney are legal documents that allow you to appoint someone to make decisions for you.
An enduring power of attorney is a great way to plan for your future. It allows you to appoint someone to make decisions about your financial, health and lifestyle needs if you are unable to make those decisions yourself due to an accident or illness for example. An enduring power of attorney can start immediately and endures or continues when you can no longer make decisions for yourself.
A non-enduring power of attorney is different. It lasts for a limited time, and is usually for a specific reason, such as if you are travelling overseas and need someone to manage your financial affairs for a short time.
2. What are the different types of powers of attorney?
In Victoria, there are four different types of powers of attorney:
- Financial: your financial power of attorney deals with any of your financial and legal issues.
- Personal: your personal power of attorney deals with lifestyle decisions, such as where you will live, ensuring that you are fed and clothed. This attorney can also consent to medical treatment and make some healthcare decisions.
- Medical: your medical power of attorney makes medical decisions. The medical attorney also has the power to refuse treatment, or make calls such as not to resuscitate.
- Supportive: this attorney can only operate whilst you are capable of managing your own affairs and is used to support people with disabilities to make and act on their decisions. You can find more information about supportive powers of attorney here.
TIP: You can appoint an attorney for financial matters and an attorney for personal matters in the same legal document.
3. When should you think about making a power of attorney?
Everyone over 18 should consider appointing an attorney under an enduring power of attorney. Most people think about dementia and old age as reasons why you need them, but you can be in a car accident that causes an acquired brain injury at any time in your life. Isn’t it better to be prepared and be in a position to choose the person you want to make decisions for you, rather than leaving the choice of decision-maker to someone else?
4. How is a power of attorney different to a will?
A power of attorney is a document that helps you plan for your lifetime. It ceases to have effect upon your death, unlike a will which comes into effect only after you have died.
5. How do you make a power of attorney? Do you need a lawyer?
You can obtain the relevant forms to fill out at the Office of Public Advocate. You don’t need a lawyer. However, if a person has complex financial and legal affairs or complex family dynamics, the advice of a lawyer may be helpful. There may be issues or circumstances you have not thought about which they can bring to your attention. It is also important to note that a medical practitioner or someone authorised to take affidavits, such as a lawyer, must witness you signing this legal document, together with a second witness. Read more about who can be a witness and their responsibilities here.
6. Common issues that arise when making a power of attorney?
Who should I appoint as my attorney?
You need to think carefully about who you will appoint as your attorney. People’s different temperaments make them ideal for certain roles. You might nominate someone who is good at managing money as your financial attorney but you may not want that person deciding where you will live. Instead you want someone who will think like you, and who will make the same kind of decisions you would have made, if capable.
Appointing a spouse or life partner
Generally, your attorney should not benefit from the decisions they make on your behalf. Issues can arise when appointing a spouse or life partner. If you want your spouse to make decisions they can benefit from, this power needs to be clearly specified in the power of attorney document.
Appointing a son or daughter
Appointing a son or daughter as your attorney can sometimes lead to conflict with other children in the family. Most of the conflicts we come across are when siblings are not informed about what is going on. Such problems may be reduced or avoided if the power of attorney document requires the attorney to report to their siblings on a quarterly, six monthly or annual basis.
It is really important that you trust the person you’re appointing. That’s the crucial take away point – making the right choice. Don’t appoint someone just because they are family or because they would be upset if you didn’t. And make sure they have the skills for the role.
Need help deciding the right person to make decisions on your behalf?
7. Common misunderstandings about powers of attorney
Most people are aware about the financial attorney, but not the other powers of attorney. Many people mistakenly think the financial power of attorney covers everything. For example, I saw a client recently, who said she was covered because she had a power of attorney. I asked which one and her response was “What, do you mean, there is more than one?” It turned out that she had an enduring power of attorney for financial matters and she thought it allowed her attorney to also make medical decisions.
If you want your attorney to also make personal decisions, about where you live for example, or decisions about medical treatment – you need to have completed the powers of attorney that cover those aspects. It’s important to understand the differences between each power of attorney and what powers are covered by each one.