• Trustees Private Wealth

Mar 29, 2023

The importance of Enduring Powers of Attorney (“EPAs”)

An EPA allows you to appoint a person (an attorney) to act on your behalf to manage your affairs and make decisions on your behalf should you become unable to do so yourself. EPAs are a “just in case” document – they need to be set up well in advance of any problems occurring. These documents are extremely important if you suffer an accident or sudden illness that leaves you unable to communicate, make decisions about your medical care or financial matters, or even do everyday things like sign important documentation and pay bills.

There are two types of EPA:

  1. An EPA specific to your personal care and welfare (medical matters) (“Personal Care and Welfare EPA”)
  2. An EPA specific to your property (financial matters) (“Property EPA”)

What if you don’t have an EPA?

If you did not have EPAs in place and you lost your ability to make decisions for yourself, your closest loved ones would need to apply to the Family Court to be appointed as your property manager (for financial matters) and / or welfare guardian (for medical matters). This is a time consuming and costly process, requiring the input of doctors and usually two different lawyers to make the application to the Court. Those costs are ongoing as these Court appointed Property Managers and Welfare Guardians have to renew their appointments through the Court every three years. The court may also appoint someone who you would never have chosen. Having EPAs in place means that you get to decide who manages your affairs for you.

If you already have an EPA, is it up to date?

Just like any legal document, it is important to review your EPAs from time to time to ensure that they are fit for purpose, and that the people you have chosen to act for you are still the best choice. For example, your attorneys may no longer be appropriate to act for you. It may be that you had appointed a previous partner, or perhaps your chosen attorney has moved away.

Over the years there have been a number of changes made to the legislation governing EPAs. The biggest of these changes occurred back in 2008.. The primary purpose of these changes was to provide greater protections against the misuse of EPAs by attorneys. As a result, there were significant changes to the preparation and execution of EPAs to ensure that the person making the EPA fully understood the powers they were granted to their chosen attorney. Stricter requirements and stronger duties on attorneys in carrying out their functions were also imposed as a result of those changes, such as the duty to always consult with the donor (the person who made the EPA), and to always act in the donor’s best interests. Further changes were made in 2017, helping to tighten and clarify the powers of attorneys further.

If your EPA is more than a few years old, or if there have been any major changes in your life, we recommend you arrange for a review of your EPAs to ensure they still suit your needs and wishes.

Who should be your Attorney?

If you are thinking about who to appoint as your attorney, or if you are an attorney for someone under an EPA here are some important things to consider:

EPA Attorneys:

  1. Should be someone who you trust to carry out your wishes and intentions. This person will have the responsibility to make decisions about your medical and/or financial matters, and therefore should be someone you trust to make the right decisions for you.
  2. Must always act in the best interests of the donor.
  3. Must encourage the donor to act where they are competently able to do so, (i.e. where mental incapacity is not an issue).
  4. Need to keep proper records of all financial transactions and the decisions behind those transactions when acting under an EPA for Property.
  5. Cannot use their powers to benefit anyone other than the donor unless the EPA specifically states otherwise.
  6. Need to consult with the donor (where possible) and any other attorney appointed under an enduring power of attorney for the same Donor and whose appointment is in effect.
  7. Powers may be suspended if and when mental capacity is regained by the donor on EPAs for Personal Care and Welfare, and for Property EPAs which only come into effect when the Donor is mentally incapable. The donor will provide the Attorney with a notice of suspension.
  8. Must seek and obtain certification of the donor’s lack of mental capacity BEFORE they can act as attorney (except where the EPA is a Property EPA which states that the EPA comes into effect immediately upon execution of the document).

Review of Attorney’s decisions

There are a number of people who can apply to the Family Court to review an attorney’s action, or to revoke attorneys’ appointment, should this become necessary.  Those who may apply for a review can be:

  • The donor
  • A relative or another attorney of the donor
  • Social worker
  • Medical practitioner
  • Trustee corporation
  • Donors welfare guardian
  • Manager of the hospital/rest home where the donor lives
  • An elder abuse or neglect prevention representative

To assist with this oversight of your attorney, you may elect to require your attorney to either provide information to or consult with certain persons (in addition to yourself).

Successor Attorney

We also recommend you have a successor attorney in the event that your first chosen attorney is not available. Your successor attorney will have the same responsibilities as agreed for your attorney, but their appointment will only take effect when the appointment of your first chosen attorney ceases.

Having a successor attorney provides greater surety that if you have lost the capacity to make your own decisions, there will be someone there with the power and ability to act for you, even if your first chosen attorney is unable to do so. For example, if you have appointed your spouse/partner as your attorney and you are both unfortunately injured in the same accident, your successor attorney can step into the role and start acting on your behalf immediately.

Talk to us

It is important to review all your estate planning documents regularly, especially if you have had a change in circumstance. If you created your EPA some time ago, it’s a good idea to get it reviewed to make sure it is still fit for purpose. Talk to one of our Private Wealth experts today who can guide you through the process and help to ensure you have a suitable EPA in place for your future protection.

Call 0800 878 783 or email [email protected]

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