What is A Power of Attorney?
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A Power of Attorney is a formal yet convenient legal document giving another person/s the authority to make personal and/or financial decisions on your behalf. It can be a difficult, yet important decision.
The Powers of Attorney Act 1998 sets out two types of Power of Attorney – A General Power of Attorney under Chapter 2 of the Act; and an Enduring Power of Attorney under Chapter 3 of the Act.
General Power of Attorney
Under the Act, giving someone a General Power of Attorney enables that person to make financial decisions on your behalf for a specific period of time. This includes anything that the principal can do in respect to its finances, property or other assets, including signing documents in your absence. A General Power of Attorney, however, is only operational during the period specified and whilst you as the principal maintain the capacity to make those decisions. Once capacity of the principal has come to an end, so does the appointment document.
You have lost capacity if you cannot;
- Understand the nature of the decision;
- Freely and voluntarily make the decision; and
- Communicate the decision in some
The benefit of a General Power of Attorney is that you may intend to take an overseas trip and leave someone the ability to manage your affairs in your absence. However, the disadvantage of a General Power of Attorney is that if your attorney is in the midst of managing your affairs and you lose capacity, they would be unable to continue.
Enduring Power of Attorney
Enduring Power of Attorney enables an attorney not only to act on behalf of the principal in relation to financial decisions, but also provides the power to act in relation to a personal decision, such as living arrangements etc.
Additionally, your appointed attorney in this instance can also continue to act on your behalf even if you lose capacity. This is particularly beneficial to the elderly who have developed a medical condition such as Dementia, or suffered a stroke etc.
Under the Act, the criteria for an individual to be appointed as an Enduring Power of Attorney, in Queensland is;
- they must be 18 years of age or over;
- not be your health care provider or a paid carer; and
- if the individual would be given power for a financial matter, they cannot be bankrupt
The most common choices are a close family member a spouse, an adult child (over the age of 18 years) or a trusted professional such as a lawyer or an accountant.
Depending on your circumstances and reasoning, your decision to appoint an attorney will depend on which type of attorney is best for you.
If you need more information on the different types of Power of Attorneys, get in touch with one of our Wills & Estate lawyers today. Cairns Wills and Estate Lawyers have been assisting clients with all aspects of Wills and Estate law for over twenty years.
We are part of Preston Law, Far North Queenland’s biggest law firm and we are based locally in Cairns.