What is a Power of Attorney?
A Power of Attorney is a document authorising someone to represent or act on behalf of another person in business and financial matters. The powers granted under a Power of Attorney can be general or specific in nature.
A Power of Attorney cannot be used to appoint an Attorney to handle medical issues. The appointment of an Enduring Guardian is required for this.
Are there different types of Powers of Attorney?
There are various types of Powers of Attorney, the most common being:
1. Ordinary Power of Attorney - allows your Attorney to do anything that you can legally do in relation to financial and property decisions. However, this type of Power of Attorney will come to an end if you lose your mental or physical capacity to manage your own affairs.
2. Enduring Power of Attorney - gives your Attorney the same powers as an ordinary Power of Attorney, however it remains in force even if you lose your mental or physical capacity to manage your own affairs.
3. Specific Power of Attorney - as the name suggests this Power of Attorney gives your Attorney a specific power in relation to your business or financial affairs.
Who is the 'Donor'?
A Donor refers to the person who grants the Power of Attorney.
Who is the 'Attorney'?
An Attorney refers to the person given power to act for the Donor.
Do I need to appoint an Attorney?
Appointing an attorney is useful if you are unwell, in hospital for a period, travelling overseas or having difficulty managing your financial affairs.
Who can make a Power of Attorney?
In order to appoint an Attorney, the Donor must be over 18 and understand what they are doing. That is they must have the required mental capacity to appoint an Attorney.
If someone does not have the required mental capacity to appoint an Attorney then an application can be made to the Guardianship Board for the appointment of an 'Administrator'. An Administrator has similar powers of an Attorney.
Who should I appoint as my attorney?
Your attorney must be over 18 years of age and mentally competent to act as your Attorney. Often an Attorney will be a relative, trusted friend or an independent person such as an employee of a trustee company.
Does a Power of Attorney need to be registered?
A Power of Attorney is only effective when it has been registered at the Titles Office. In Tasmania, a Power of Attorney that is not registered is of no effect. This means that an Attorney cannot act on behalf of the Donor until such time as the registration of the Power of Attorney has been finalised by the Titles Office.
When does a Power of Attorney come to an end?
Both ordinary and enduring Powers of Attorney will end on death. When someone dies, their Will, or if they die without a Will the Administration and Probate Act, will apply.
It is strongly recommended that you instruct a solicitor to prepare your Power of Attorney to ensure that your appointed Attorney has the legal capacity to manage your business and financial matters.
If you have any queries about Powers of Attorney, please contact us on 03 6332 9353.
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