In Australia, a Power of Attorney (POA) is a legal document that allows an individual (the principal) to appoint another person or persons (the attorney or attorneys) to make financial and legal decisions on their behalf. There are several types of powers of attorney, each serving different purposes:
General Power of Attorney
This type of POA grants broad powers to the attorney to manage the principal's financial and legal affairs. It is typically used for short-term or specific purposes, such as authorizing someone to handle financial transactions while the principal is traveling overseas.
Enduring Power of Attorney (Financial)
An enduring power of attorney remains valid even if the principal becomes mentally incapacitated or unable to make decisions. It allows the attorney to continue managing the principal's financial affairs on their behalf.
Enduring Power of Attorney (Medical Treatment)
This type of POA authorizes the attorney to make medical treatment decisions on behalf of the principal if they are unable to do so themselves due to incapacity. It is also known as a medical power of attorney or healthcare proxy.
Limited Power of Attorney
A limited power of attorney grants specific powers to the attorney for a particular purpose or transaction. For example, it may authorize someone to sell a property on behalf of the principal.
To create a valid power of attorney in Australia, certain requirements must be met:
- The principal must have legal capacity, meaning they must be of sound mind and over the age of 18.
- The document must be in writing and comply with the formal requirements prescribed by state or territory legislation.
- The principal must sign the document in the presence of witnesses who are not beneficiaries or attorneys under the POA.
- The attorney must also sign the document to accept their appointment.
- For enduring powers of attorney, additional formalities may apply, such as registration with the relevant government authority.
In New South Wales (NSW), Australia, both Enduring Power of Attorney (EPA) and General Power of Attorney (GPA) are legal documents that allow individuals to appoint someone to make decisions on their behalf.
An EPA must be made in a specific form prescribed by law and must be signed by the principal, witnessed by two adults who are not beneficiaries or attorneys under the EPA, and signed by a prescribed witness (e.g., a lawyer or licensed conveyancer).
In NSW, the rules and requirements for creating and using both types of powers of attorney are governed by the Powers of Attorney Act 2003 and the associated regulations. It's essential to understand the differences between the two types of powers of attorney and choose the most suitable option based on your circumstances.
Before creating a power of attorney, especially an Enduring Power of Attorney, it's advisable to seek legal advice to ensure that the document accurately reflects your wishes and complies with the relevant laws. Additionally, consider discussing your intentions with the chosen attorney(s) to ensure they understand their responsibilities and are willing to act in your best interests. Speak with the Leyden Legal team regarding Power of Attorney today.
