Powers of Attorney provide the ability for a person’s (and a trust or company's) affairs to continue being administered if the person becomes unable to do so.
It is really important to have both forms in place. Spouses do not have automatic rights. If a person does not have the EPAs, then an application must be made to the Court for appointment of a manager. This is very costly and the person's affairs are frozen.
Enduring Powers of Attorney
The Protection of Personal and Property Rights Act 1988 allows anyone mentally capable over 18 ("the Donor") to appoint a person ("their Attorney") to act on their behalf in relation to either all or limited to prescribed matters for the personal care and welfare of the Donor and for the Donor’s property. Most people complete both forms of Enduring Power of Attorney ("EPA's").
It is really important to have both forms of EPA in place. Spouses/partners do not have automatic rights to act without an EPA. If a person does not have the EPAs and becomes mentally incapable (for both forms of EPA) or is overseas or incapacitated (for property EPA) then an application must be made to the Court for appointment of a manager. This is very costly and in the meantime the person’s affairs are frozen.
The appointment for Personal Care and Welfare only takes effect when a medical practitioner experienced in such matters, determines that the Donor is mentally incapable of looking after their own care and welfare. The Attorney is then authorised to make decisions on such matters (unless restricted in the document) as the Donor’s medical and dental treatment, their residential care, life support decisions and their general care and welfare.
The Property appointment usually grants the Attorney authority to act whilst the Donor is still mentally capable and continues when they are not. It usually authorises the Attorney(s) to make decisions relating to all the Donor’s property which may include bank accounts, investments, land etc. including sale and purchase of those assets. It does not give authority to act as a trustee or company director.
The Donor normally appoints a successor Attorney in case the original Attorney is incapable of acting for whatever reason. Most Donors appoint a close family member or friend for Personal Care and Welfare and the same persons and/or their lawyer for Property. The appointment (and power) ceases on the death of the Donor.
Ordinary Power of Attorney
An Ordinary Power of Attorney ("OPA") can be completed in relation to all a person’s affairs (but not including personal care and welfare). The difference between this form and the Property EPA is that it covers trusteeships and company directorships and the power ceases when the Donor becomes mentally incapable. As with EPA’s, it also ceases on death of the Donor.
Power of Attorney and Deed of Delegation
Section 31 of the Trustee Act 1956 allows a trustee to appoint an Attorney to make trustee decisions and sign documents for them should the trustee be overseas or temporarily incapacitated. This form is generally granted when there is an EPA in place rather than an OPA.
Company Power of Attorney
Section 181 of the Companies Act 1993 allows a Company to appoint one or more Attorneys to act generally or for a specified matter for the company should any of the Directors be unable due to being overseas or temporarily incapacitated.
- This e-mail address is being protected from spambots. You need JavaScript enabled to view it is a Partner with Rodgers-Law in Dunedin and advises small and medium sized businesses on all aspects of commercial law.
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