Do you know the difference between a Power of Attorney and Enduring Guardian document? Do you understand how these documents can benefit you and your wellbeing? The team of wills and estate lawyers at The Quinn Group can help you to understand when, and why, these important documents might be required by you or your loved ones. We’ll also guide you through the necessary processes and requirements, ensuring that your wellbeing and your estate is well looked after and protected.

Let’s define the basics and discern the difference between a power of attorney and enduring guardian document.

Power of Attorney: What is It?

A Power of Attorney is a legal instrument by which one person (called the Principal) confers upon another (called the Attorney) the authority to perform certain acts on his or her behalf. What this means is, you are able to give your Attorney the power to make decisions or to do anything with your property and finances that you could do yourself – with or without limitation.

Some of the purposes that you can assign a Power of Attorney for include:

  • The collection of debts
  • Voting at meetings
  • Operation of your bank account
  • Management of your investments
  • Paying bills

The Problem

The problem with an “ordinary” Power of Attorney is that they lapse when the Principal loses capacity (e.g. coma, dementia or Alzheimer’s disease) leaving the Attorney in an exposed position. For example, if the Attorney sold assets on the Principal’s behalf, he or she could be held accountable if the Power of Attorney has lapsed.

Enduring Power of Attorney

To overcome this problem there is another type of Power of Attorney called an Enduring Power of Attorney. An Enduring Power of Attorney is valid (unless revoked) until the maker (the Principal) passes away.

Everyone who owns land, has a bank account, or who owns any other assets of some worth in their sole name, should execute an Enduring Power of Attorney.

However, you do not have to lose the ability to do things for yourself to take advantage of a Power of Attorney. If you are intending to travel interstate or overseas, the person that you appoint as your Attorney can do as much or as little for you as you need them to do while you are away. You can authorise your Attorney to operate one bank account only or to deal on your behalf with one particular property that you own. Or, you can authorise your Attorney to deal with all of your assets.

A Power of Attorney, or Enduring Power of Attorney, document is created by a legal professional from a standard pro forma template which is then tailored in parts for each individual. You must then sign the form and have it witnessed with your legal representative present. 

Can I limit the scope of an Enduring Power of Attorney?

Yes. Some Principals require that the Enduring Power of Attorney only take effect after a doctor has confirmed a loss of capacity, and others require that the medical certificate be reviewed and renewed every 6 months.

Enduring Guardianship

When discerning the difference between a Power of Attorney and Enduring Guardian document, it is vital to note what an enduring guardian is. An Enduring Guardian document is quite similar to the Power of Attorney in many ways. 

An enduring guardian generally has wider powers than an attorney appointed by a Power of Attorney document. If you lose the mental capacity to make your own decisions, an enduring guardian can make personal decisions on your behalf, to decide any or all of the following:

  • The place you are to live (such as a specific nursing home, or your own home)
  • The health care you are to receive
  • The other types of personal services that you are to receive
  • The medical or dental treatment to be carried out on you

An enduring guardian cannot consent to anything unlawful and cannot attend to certain things, including but not limited to:

  • Make a will for you
  • Vote on your behalf
  • Manage your finances
  • Override your objections (if any) to medical treatment

To appoint an enduring guardian, you must sign a form of appointment. You can appoint one or more enduring guardians with the same functions in the same form. If you wish to appoint two or more enduring guardians with different functions, you need to complete separate forms. These forms should be prepared and witnessed by a qualified legal professional.

The enduring guardianship document is an important legal instrument, and the original should be kept in a safe place. It’s important that the appointed guardian has a copy, and a certified copy where possible. We at The Quinn Group safely store our clients’ documents in our safe custody file until such a time that we are required to retrieve it in order to revise it or act upon related matters.

Summary: The Difference Discerned

We now have clarified the difference between a Power of Attorney and Enduring Guardian document. In summary, a Power of Attorney bestows the authority on a person to act for you in specified legal and financial matters, whereas an Enduring Guardian document allows for a person to make lifestyle, health and medical decisions for you when you are unable to do so or have lost capacity.

If you would like to discuss drafting either of these documents, making your will or have any queries in relation to wills and estates law, our expert team of wills and estates lawyers can assist and advise you on your individual situation. We’ve written an eBook on this topic: ‘The Definitive Guide to Wills and Estates in Australia’ which you can download for free from our website. It clarifies important information, helping you to:

  • Understand how to validly draft and execute your Will
  • Update and protect your Will
  • Consider tax-effective estate planning
  • Know what to do when someone dies
  • Protect the assets of an estate
  • Contest a Will

Need Help?

If you would like help with respect to wills and estates law, please contact one of our experienced lawyers by submitting an online enquiry form, calling us on 1300 QUINNS or alternatively, +61 2 9223 9166 to arrange a teleconference or appointment.

 

The content on this page has been updated and is current as at 29 April 2021.