Demystifying Power of Attorney in Australia: Your Ultimate Guide to Legalities, Types, and Procedures

Wills and Estate Planning

A Power of Attorney (POA) is a critical document in Australia that lets someone else (the attorney) make decisions on your behalf when you (the principal) can’t. But all the legal stuff and different types and procedures can be overwhelming. Don’t worry; our guide has got you covered. It will make Power of Attorney in Australia simple and easy to understand.

What is Power of Attorney?

A Power of Attorney in Australia can be a great tool to handle your needs when you cannot decide independently. By granting someone the authority to make decisions on your behalf, you can know that your finances, property, personal care, and medical treatment are in capable hands. It is important to note that there are different types of Power of Attorney, each having its unique purpose and varying levels of authority. Understanding these differences lets you decide which type of Power of Attorney suits your needs.

Types of Power of Attorney

1. General Power of Attorney (GPOA):

  • A General Power of Attorney is typically used for a specific period, such as when you are overseas and need someone to manage your affairs.
  • Granting power of attorney is a way to authorise another person to act on your behalf in financial and legal matters. This includes managing bank accounts, paying bills, and signing documents, among other important decisions.
  • However, a GPOA becomes invalid if the principal loses mental capacity.

2. Enduring Power of Attorney (EPOA):

  • Enduring Power of Attorney in Australia is a great way to plan for the future and ensure that someone you trust can make important decisions on your behalf, even if you become mentally incapable. This legal agreement is designed to give you peace of mind, knowing that your best interests will be protected.
  • It can cover financial matters, such as managing bank accounts, paying bills, and selling property, as well as personal issues, such as where you live and the health care you receive.

There are two types of EPOA:

  • Financial EPOA: Gives the attorney the control to make economic and lawful decisions on your behalf.
  • Medical Treatment Decision Maker (MTDM): Gives the attorney the authority to make individual and health care decisions on your behalf, such as where you live and the health care you receive.

3. Medical Power of Attorney (Health Care Directive):

  • By creating a Medical Power of Attorney, also known as a Healthcare Directive, you can confidently designate someone to make critical medical decisions on your behalf if you become unable to do so yourself.
  • This can contain decisions about your medical treatment, where you receive medical treatment, and the types of medical treatment you receive.

Legalities of Power of Attorney in Australia

Capacity:

  • For a Power of Attorney to be considered valid, the person granting the authority (known as the principal) must have the mental capacity to understand the nature and implications of the document fully.
  • The attorney must also have the mental capacity to understand their responsibilities under the Power of Attorney.
  • If there is any doubt about the principal’s or attorney’s capacity, seeking legal advice is essential.

Witnessing and Signing:

  • The principal must sign the Power of Attorney document in the sight of two witnesses who are not beneficiaries under the document.
  • The witnesses must also sign the document in the presence of the principal.
  • Witnessing the document ensures that the principal understands the nature and effect of the Power of Attorney and is not being unduly influenced by anyone else.

Procedure for Creating Power of Attorney

Choose an Attorney:

  • Select someone you trust to decide on your behalf if you cannot.
  • This could be a family member, friend, or professional advisor, such as a solicitor or accountant.

Choose the Type of Power of Attorney:

  • Decide whether you need a General Power of Attorney (GPOA), an Enduring Power of Attorney (EPOA), or a Medical Power of Attorney (Health Care Directive), or a combination of these.

Draft the Document:

  • You can draft the Power of Attorney using a template or seek legal advice from a solicitor or lawyer.
  • The document must clearly state the powers given to the attorney and any limitations or conditions on those powers.

Signing and Witnessing:

  • The principal must sign the Power of Attorney document in the presence of two witnesses who are not beneficiaries under the document.
  • The witnesses must also sign the document in the presence of the principal.
  • The witnesses should also provide their full names, addresses, and occupations on the document.

The Power of Attorney is a legal document that permits someone to decide on your behalf if you can’t. Understanding the different types of Power of Attorney and how to create one is essential to ensuring that your affairs are properly handled, and your wishes are respected in case of incapacity.

If you need help creating a Power of Attorney in Australia, don’t worry! You can always seek legal advice from a solicitor or lawyer who can guide you. Remember, it’s always better to be prepared for the unexpected!

We hope this helps!

VK Lawyers