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Quick guide: Enduring Powers of Attorney

November 13, 2017

An Enduring Power of Attorney is one of the most important documents for you to have in place once you are over the age of 18. 

It’s best to get an Enduring Power of Attorney (EPOA) in place while you’re young and healthy in case of an accident or sudden illness. In fact, EPOAs can even come in handy while you’re away on holiday. Yet so many Kiwis haven’t heard of an EPOA, let alone have one. So what is this important document and why do you need it?

Couple considering an Enduring Power of AttorneyWhat is an Enduring Power of Attorney?

An EPOA is a document you sign that, in broad terms, allows another person (your ‘attorney’) to make certain decisions or take certain actions on your behalf. These powers can be given to one person or multiple people. Typically, you would appoint a trusted family member or friend as your attorney.

There are two types of EPOAs:

  • Property – this authorises your attorney to act on your behalf in respect of your personal assets, for example real estate, insurance or bank accounts. This type of EPOA generally comes into effect the moment you sign it. In other words, you do not need to have lost mental capacity before your attorney can act on your behalf under this type of EPOA.
  • Personal Care and Welfare – this authorises your attorney to make decisions relating to your health, for example medical treatment, administration of medicines or being admitted into care. This type of EPOA only comes into effect when you have been deemed by a suitably qualified person to have lost the capacity to make these decisions for yourself.

We recommend having both types of EPOAs.

Why do I need Enduring Powers of Attorney?

Many people wrongfully assume that in the event they lose the mental and/or physical capacity to act in their own interests, their immediate family will have an automatic right to deal with their affairs. The simple and legal truth is that if you have not prepared EPOAs, family members have to apply for a court order allowing them to act on your behalf, which can be a stressful, time-consuming and costly exercise. Only an EPOA gives your attorney the legal right to deal with your assets or make decisions about your care and welfare.

Another common misconception is that only the elderly need to have EPOAs in place. However, accidents or illnesses that impair your ability to act in your own best interests can happen to anyone, regardless of age.

EPOAs are not only of assistance when you have lost mental capacity. An EPOA in respect of your property can also help in circumstances where you still have mental capacity but are not able to sign a document. For example, if something important crops up while you are overseas and out of contact, your attorney can sign certain documents on your behalf.

What should I do to establish an EPOA?

There are strict rules around EPOAs, one of which is that they must be prepared by a lawyer. Your lawyer must also clearly explain the legal effect of the EPOAs to you.

Please get in touch with Hannah or contact reception if you would like to discuss putting some EPOAs in place for yourself.

Recommended reading:
What is the PPPR Act and how does it affect elder law?
Do you have a valid Will?
3 reasons you might need a family trust


Hannah Blewden

P/ 09 489 9102

E/ hannah@armstrongmurray.co.nz

Hannah Blewden from Armstrong Murray law firmHannah began working at Armstrong Murray as a Law Clerk in 2014 while studying towards a Bachelor of Laws and Bachelor of Arts with a double major in Political Science and International Relations. She joined Armstrong Murray full time after completing university in November 2015.

As a junior solicitor, Hannah enjoys the variety of work and the family-like culture at Armstrong Murray. She is steadily developing a wide range of expertise in most areas of law, including Litigation, Property and Estates.

 

This article is brief and general in nature. You should not treat this article as legal advice and should seek professional advice before taking any action in relation to the matters dealt with in this article.  Armstrong Murray accepts no liability for losses suffered by any person or organisation who may rely directly or indirectly on this article.

 

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