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General & Enduring Power of Attorney

Owen Hodge Lawyers in Sydney provide expert legal services including advice on Enduring Power of Attorney…

Power of Attorney (POA) is a legal document giving the appointee the power to do what one can do at law for a particular period or transaction, but terminates once the principal loses capacity. Whereas an Enduring POA is still effective once capacity is lost, which is fundamental for dementia patients.

The POA Act requires both the donor and attorney to sign and accept the conditions outlined in the document, this minimises misunderstanding about the attorneys duties and prevents problems after capacity is lost. As such a POA has significant financial responsibilities to the principal which must be complied with and creates a fiduciary relationship. However we only find the test for capacity to make an Enduring POA at common law, requiring the principal to understand the nature and effect of appointment.

An attorney must act in the best interests of the principal however this doesn’t prevent financial mismanagement or abuse. In order to prevent such a situation the law prevents an attorney from authorising a gift unless authority is clearly outlined. The POA Act also provides for the Supreme Court to make orders confirming powers in the best interest of the principal, illustrating that NSW legislation is effective in protecting the financial needs of dementia patients.