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Power of Attorney

Information For Donors

This information is intended to support you in reading decisions about giving a power of attorney.

What Is A Power Of Attorney?

A power of attorney enables you, as donor, to give another person (the attorney or donee) the right to sign or execute documents or perform acts on your behalf. The right given by you is an important duty.

To ensure your wishes are properly met, care must be exercised in choosing and appointing an appropriate donee, as well as in drafting your power of attorney.

Who Can Be My Attorney?

Any person over 18 years of age and of sound mind may be appointed as your attorney.

What Authority Can An Attorney Have?

Your attorney may have as much or as little lawful authority as you desire.

If you wish, your attorney may have unlimited authority with respect to your affairs: this is known as a general unlimited power of attorney. However, should you wish your attorney’s authority to be limited to certain assets or interests, or by reference to specific time periods, then this must be specified.

While the power of attorney exists, your attorney has your authority to sign documents and create obligations on your behalf. You will be bound by all acts of your attorney that occur within the authority you have given to them. If the attorney acts in excess of their authority, then that act will not bind you unless you were to later approve or ratify it. Therefore, the powers, assets or interests that could be affected by the power of attorney should be considered carefully prior to drafting the document itself.

How Long Will My Power Of Attorney Last?

The power will not last indefinitely. The power of attorney may end when one of a number of circumstances occur, including:

    • on your death (except in unusual circumstances)
    • death of the donee
    • bankruptcy of either you or your donee
    • unsoundness of mind of either you or your donee*
    • when the power is frustrated (e.g. if the authority was only in relation to a building which was subsequently destroyed, or was sold by you)
    • if performance of the power would require your attorney to undertake unlawful acts
    • express revocation by the donor
    • express renunciation by the donee
    • implied rectification by the parties
    • expiration of time for which the power was granted
    • by the happening¬†of an event upon which it was specified by you in the power of attorney that it shall came to an end.

* In ordinary circumstances, if you, as the donor suffers from unsoundness of mind, such that you/he/she lost your legal capacity, the power of attorney will come to an end at that time. However, if the power of attorney specifies that it is to survive your becoming of unsound mind, then it will not cease in those circumstances. This form of power of attorney is an Enduring Power of Attorney. We recommend that such a power of attorney be created.

If an Enduring Power of Attorney is not created, and you were to suffer from unsoundness of mind, the assets held by you (including those held jointly, such as the family home) would come under the control of a State Government official.

In NSW this is the Office of the Protective Commissioner. Should any family members or close friends need to use, or sell, any of your assets, they would have to petition the Supreme Court to become managers of your assets. Not only would this be costly, it may also be subject to legal delays. Also, these people would have to prove to the Court that they were, indeed, an appropriate person to look after the assets. A petitioner may even be a person who you would never have wanted to look after these assets. In the meantime, and much needed decisions cannot be made.

In short, your wishes and your best interests may not be fulfilled unless you have an Enduring Power of Attorney.

Execution

For an Enduring Power of Attorney to be validly executed in NSW, the donor must sign before a prescribed person: a solicitor, clerk of Petty Sessions, or a Barrister. This prescribed person must also attest to and provide a certificate that states the effects of an Enduring Power of Attorney have been explained to the donor.

If the Power of Attorney is not enduring, any person may witness execution by the donor.

If you intend on giving your attorney the power to deal with land or company shares, then this power of attorney will need to be registered with Land & Property Information at a cost of $73.25.