What an EPOA means
It’s no easy job taking on the role and responsibility of attorney appointed under an Enduring Power of Attorney (EPOA) and in some cases, it’s difficult to know exactly what you can and can’t do as an attorney.
However, there’s one certainty in acting as an attorney and that is acting in the best interests of the person who nominated you to act for them (“the Principal”) and in accordance with the terms and conditions set out in the EPOA document.
Generally, an attorney can do all the things the Principal can do in relation to their legal and financial affairs, such as buying and selling real estate, operating bank accounts, spending money on the Principal’s behalf, entering into legal agreements on behalf of the Principal, exercising the Principal’s rights as a shareholder and managing investments.
In some Australian States and Territories, a Principal can place limitations and conditions on the attorney which is legally binding on the attorney.
SOPHIE AND HER DAD
Sophie has been appointed attorney by her father, Sean, who has dementia and has lost mental capacity to make important legal and financial decisions.
Sean has several investments, including superannuation and real estate in a number of States in Australia, and his financial adviser has recommended that Sophie sells one of the investment properties in another State to help fund Sean’s care expenses.
Sophie remembers her father once telling her that he was thinking of leaving that investment property to her brother Matthew in his Will, and is not sure whether she should sell the property or not.
Sophie has also received a notification from Sean’s superannuation fund advising that Sean’s binding death benefit nomination is due to expire.
This scenario is not unique and raises complex issues for Sophie, as the attorney, to navigate.
CAN SOPHIE SELL?
The first issue is whether the EPOA made in one State or Territory of Australia can be used in another State or Territory of Australia. As is often the case, the answer is “it depends.”
For example, if Sean made an EPOA in New South Wales and the property to be sold is in Queensland, under the Queensland Power of Attorney legislation the New South Wales EPOA will be recognised as valid and Sophie can sell the Queensland property using the New South Wales EPOA.
However, if the property is in Western Australia, Sophie will have difficulties arranging the sale because that State does not have the same recognition legislation.
WHAT ABOUT THE WILL?
The second issue faced by Sophie is whether she can see the Will to verify her father’s intentions.
While each State and Territory in Australia has its own legislation and regulations around powers of attorney, it’s generally accepted that an attorney does not have the automatic right to see the Principal’s Will. It’s most often the case that the original Will is kept by the law firm who has prepared the Will, and the firm will have procedures in place to ensure that the Principal’s privacy is protected.
So unless Sophie’s dad gave her a copy of his Will, or she has a signed written direction authorising her to receive a copy, then Sophie will not be able to obtain a copy of the Will.
Lastly, Sophie would like to know if she can (and should) renew her father’s binding death benefit nomination. There is no simple answer to this question, as there are a myriad of issues that can impact on whether the answer is yes or no.
The particular rules of the superannuation fund, the State and Territory legislation and regulation governing Powers of Attorney and the actual Power of Attorney document would need to be reviewed to find the answer.
It’s important that you get advice when making an EPOA so you can make sure you have the right supporting documents and particular provisions in your EPOA document that they will do what you need them to do.
More information about EPOAs is available on our website at www.eqt.com.au/poa