EPAs did not exist prior to 1992 when the Act was proclaimed
Explain donee/attorney is the same thing – donee is the term used in the Act. BENEFITS OF AN EPA Allows a person to choose another trusted person (the attorney) to manage his or her property and finances immediately or in the event of loss of capacity. An EPA is not affected by the subsequent legal incapacity of the donor (section 105(1) of the Act) unlike a general power of attorney. Provides a safeguard in the best interests of the donor and the estate should the donor lose capacity to make reasoned decisions. Provides a mechanism for continuity of management of a donor’s financial and property affairs, thereby minimising immediate financial hardship if the donor’s decision-making ability is suddenly impaired. Provides the means for the donor to impose conditions or restrictions on the exercise of the power based on his or her wishes for the management of the estate. 5. Enables the donor to maintain confidentiality in respect of his or her financial property affairs. 6. If donor chooses to have his or her EPA take immediate effect, it reduces the need for an application for an administration order to be made to the State Administrative Tribunal during a period of incapacity of the donor.
This section covers powers of attorney, obligations, responsible management, fees, revocation and safeguards. Ask participants to turn to page 11 of EPA Guide for list of limitations of attorney’s powers. An attorney does not have authority to: Make a will on behalf of donor Make guardianship or lifestyle decisions (eg accommodation decisions) Do any act which is illegal Deal with any property held in trust by donor (governed by Trust deed) Perform the functions of a director or secretary of a company on behalf of Donor unless authorised by the constitution of the company. Delegate their authority
ACTIVITY – ask group to work in pairs and write down what they think an attorney would or could do. Purchase, sale, leasing, maintenance and improvement of property Payment of debts Investments Arrangements and payment of insurance Operation of bank accounts Receipt of income Management of donor’s business interests Share voting rights Entering into, completing or terminating contracts Taxation Social Security entitlements Notify various relevant financial institutions/authorities of the ‘authority’ and at the same time ascertain full extent of the estate. Provide as required specific instructions for the protection of the assets as well as for redirection of correspondence. BANK ACCOUNTS Records should not be mixed with those of attorney’s. (all receipts to be retained) Recommend operating separate working bank accounts for donor (even in husband and wife situations). LEGAL PROCEEDINGS It may be that an application for administration be required in some cases. (Eg next friend or Ad Litem for civil actions.) ASSETS OUTSIDE OF WA WA residents with assets in other jurisdictions should seek clarification as to requirements and recognition of WA EPA. May need to consider executing EPA in that jurisdiction. LIFESTYLE CONSIDERATIONS…. An attorney should manage the estate responsibly while maximising the donor’s quality of life. The wishes of the donor in whatever manner they have expressed should also be considered.
Talk to them about where to get the forms Check that they have capacity – you may be able to assist with gp appointment re capacity Ensure they are not being coerced into making an EPA and appointing someone who will not manage their property in their best interests Check agency policy re witnessing of EPA forms Refer to community legal centre or PA if you think they need advice Ask to see a copy of the EPA – check it is signed appropriately and is already in operation
ACTIVITY To be capable of signing an enduring power of attorney, a person must understand the nature and effect of the document. Does the donor know: 1. the nature and extent of their own estate. 2. that the enduring power of attorney will give the attorney complete authority to deal with the estate (provided that such dealings are consistent with the interests of the donor of the power) 3. that while competent, the donor may direct the power of attorney to act in a particular way and may revoke the power at will. 4. That the donor may choose for the Enduring Power of Attorney to come into effect immediately or only in the event that they lose capacity 5. that the attorney’s stewardship will not be monitored or audited as a matter of course, and therefore, that in choosing an attorney, the donor is placing a very high level of trust in the appointed person or organisation.
Is the person likely to always act in the donor’s best interests?
The Public Advocate recommends that donors discuss their decision to complete an EPA with their family/friends. The Public Advocate is aware of the possibility of considerable family conflict when such matters are not discussed, resulting in applications to the SAT The Public Advocate recommends originals/copies of the EPA are kept with others e.g. the family doctor
The Public Advocate’s view is two witnesses are present at the time of signing. That Section 104(2) of the Act provides: “ An instrument is not effective to create an Enduring Power of Attorney unless there are two attesting witnesses to the instrument and both of them are persons authorised by law to take declarations; and the instrument has endorsed on it, or annexed to it, a statement of acceptance in the form, or substantially in the form, of Form 2 in Schedule 3 executed by the person or persons appointed to be the power.” Discuss what is authorised witness – list on Page 9 of Info Kit Retirement may affect eligibility – refer to the Schedule in Oaths, Affidavits and State Decs Act 2005 – while doctors appear to have “lifetime” eligibility to witness, some bank managers may not (ie their eligibility to witness ceases with their employment at the bank Authorised witnesses differ outside WA: outside WA but within Australia : anyone who has authority in the State or Territory to sign stat decs. outside Australia : a prescribed consular official; a justice or notary public under the law of that place; a person who has authority under law of that place to take stat decs. Refer to change in legislation which brought witnesses into line with Commonwealth law and dramatically increased the occupations which can now witness an EPA – now nurses, defence force officers, post office managers, among others. Also people who have authority under Commonwealth Stat Decs Act 1959. The Oaths, Affidavits and Stat Decs Act 2005 did away with Commissioners of Declarations in WA so an EPA signed by a CD after January 1 2006 is not lawful.
TIME TO OPEN KIT Clause 4 of the EPA governs the time from which the donee is authorised to exercise power. The donor must choose when the power is to become effective by deleting either clause 4(a) or 4(b) when completing the document. Failure to do this may invalidate the EPA. Clause 4(a) gives the attorney immediate authority to act. Clause 4(b) provides for the EPA to come into operation only when the SAT, on application by the attorney, has declared that the donor does not have legal capacity (section 106 of the Act). The State Administrative Tribunal has the authority under the Guardianship and Administration Act to determine capacity. We will have a closer look at its functions later.
Apart from Common Law obligations and those imposed by various statutes of law (eg Property Law Act, Transfer Land Act), the G&A Act imposes its own specific obligations. The above obligations are in relation specifically to G&A Act – be mindful that there is other legislation that can also affect powers of attorney (Eg Property Law Act,) and Common Law Principles Any failure to do so may result in the Donor becoming liable. Promote idea of having accounts available to family members or to have them professionally audited. Only the SAT can approve revocation of power if donor loses capacity. Attorney could be liable for any loss if he/she fails to act diligently (eg loss in share speculation without proper professional advice).
Attorney has an obligation to act with reasonable diligence and in the best interests of the donor. The Act is silent on gifting. An attorney would have to be sure that intentions reflect past wishes of the donor and that action is not detrimental to the estate. If in doubt make application to the Tribunal for directions. OTHER POSSIBLE BREACHES….. Transfer of property to relative under market value Kit provides information on Obligations for Attorney on Page 8. The Attorney should be made aware of these before signing the acceptance. Where there are transactions (eg transfer of land to a relative or substantial gift) it would be appropriate for the Attorney to seek directions from SAT discharge a mortgage where the mortgagor has not paid all money owing to the donor. forgive a loan owing to the donor by another person.
An EPA is a private arrangement between people and no formal registration of document is required (like a Will). There are 2 originals in the Kit – best to complete We recommend lodging within 3 months.
SAFEGUARDS A person with an interest in the matter may apply to the SAT for an order. Requiring the attorney of the EPA to file with the Tribunal and serve on the applicant a copy of all records and accounts kept by the attorney of dealing and transactions made in connection with the EPA. Requiring records and accounts to be audited by an auditor appointed by the Tribunal. Tribunal and applicant to receive copy of report. Revoking or varying the terms of the EPA. Appointing a substitute attorney. Where there is concern that an attorney is not acting in the best interests then an application for intervention should be filed with the Tribunal. It may also be necessary to file an Administration application. If uncertain you may wish to discuss issues by contacting OPA’s Telephone Advisory Service. There may be a need to contact agencies (such as the bank) for immediate protection in certain circumstances. Where conflict exists between the attorney and guardians, carers, professionals or family, we would suggest that all efforts be made to resolve the issues in the donor’s best interest before making an application. Where a person has not executed an EPA and concern exists as to the person’s decision-making capacity an application for administration and/or guardianship may be necessary. Section 97 of the G&A Act provides the Public Advocate with authority to investigate complaints or the need for a G and/or A order for a person. This would extend to concerns where the attorney may not be acting in a proper manner on behalf of a person with a decision-making disability.
Enduring Power of Attorney Presented by
Enduring Power of Attorney Presented by Debra Casey Senior Policy Officer
Guardianship and Administration Act 1990 <ul><ul><ul><li>Protects and promotes the human rights of people with a decision-making disability </li></ul></ul></ul><ul><ul><ul><li>Part A provides for Enduring Powers of Attorney </li></ul></ul></ul>
What does an EPA do? <ul><li>$$$ </li></ul>It enables a competent person ( donor ) to provide authority to another ( attorney/donee ) to make property and financial decisions
Scope of attorney’s powers <ul><li>The attorney stands in the shoes of the donor in regard to property and financial matters </li></ul>
Estate management <ul><li>The donor’s best interests are paramount in managing the estate </li></ul>
Benefits of an EPA <ul><li>Prepare for the future </li></ul><ul><li>Protect yourself from exploitation </li></ul><ul><li>Choose how you want your money to be managed if you lose capacity </li></ul>
What to do if…… <ul><li>A client wants to make an EPA </li></ul>
Capacity issues <ul><li>If there are any doubts about a person’s capacity the document may be invalid </li></ul><ul><li>If there is ANY doubt, consult a medical practitioner </li></ul>
Who to choose? <ul><li>Is the proposed attorney: </li></ul><ul><li>trustworthy? </li></ul><ul><li>willing to take on the responsibilities? </li></ul><ul><li>skilled and knowledgeable in areas relevant to the donor’s estate? </li></ul>
Who to choose? <ul><li>Can they keep accurate records? </li></ul><ul><li>Are they available to make decisions? </li></ul><ul><li>Is the appointment likely to cause conflict within the family? </li></ul>
What to do if…… <ul><li>Someone says they are a persons attorney </li></ul>
Witnessing EPAs <ul><li>The document requires that: </li></ul><ul><li>2 witnesses are present at the time of signing </li></ul><ul><li>Witnesses must be authorised </li></ul>
When does the power begin? <ul><li>There are choices described in clause 4 of the EPA Information Kit (p6) </li></ul><ul><ul><li>Clause 4(a) gives the attorney immediate power to act </li></ul></ul><ul><ul><li>Clause 4(b) only gives power to the attorney if the State Administrative Tribunal – on application from the attorney – finds the donor does not have legal capacity </li></ul></ul>
Revocation <ul><li>The process of revoking an EPA depends on whether or not the donor has capacity </li></ul>
What to do if…… <ul><li>You think someone’s money is not being managed in their best interests </li></ul>
Obligations of attorney <ul><li>Must keep and preserve accurate records and accounts of all dealings and transactions </li></ul><ul><li>Must apply to the Tribunal if unable to continue as attorney once donor has lost capacity </li></ul><ul><li>Must exercise power with reasonable diligence </li></ul>
Attorneys could be in breach if they: <ul><li>Make a gift of donor’s assets or income. For example: </li></ul><ul><ul><li>forgive a loan owing to a donor </li></ul></ul><ul><ul><ul><ul><ul><li>or </li></ul></ul></ul></ul></ul><ul><ul><li>dispose of assets at less than market value </li></ul></ul>$ $ $
Registration <ul><li>If the donor owns land he or she may wish to lodge the EPA at Landgate* </li></ul><ul><li>(*formerly Department of Land Information ) </li></ul>
Role of the State Administrative Tribunal (SAT) <ul><li>When a person has lost capacity the SAT . . . </li></ul><ul><ul><li>Has some authority in relation to EPAs </li></ul></ul><ul><ul><li>receives applications for intervention where problems may exist </li></ul></ul>
<ul><li>Telephone Advisory Service (TAS) </li></ul><ul><li>1300 858 455 </li></ul><ul><li>For information and advice on: </li></ul><ul><ul><ul><li>allegations of abuse (of adults with a decision-making disability) </li></ul></ul></ul><ul><ul><ul><li>Guardianship and Administration </li></ul></ul></ul><ul><ul><ul><li>Enduring Powers of Attorney </li></ul></ul></ul>
Where to find an EPA kit <ul><li>State Law Publisher </li></ul><ul><li>Email: [email_address] </li></ul><ul><li>Ph: 9321 7688 </li></ul><ul><li>www.publicadvocate.wa.gov.au </li></ul><ul><li>Some Newspower newsagencies </li></ul>