What happens if I lose capacity and I don’t have any legal documents in place?

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Written by James Kelly, Partner Wills & Probate Lawyer 

Are you aware of the consequences of not having an Enduring Power of Attorney and Enduring Guardianship appointment in place if you lose your capacity?

If your answer to the above question is no and that circumstance arises, somebody can approach the NSW Civil and Administrative Tribunal (NCAT) Guardianship Division and seek an order for control of your affairs. There are similar tribunals and/or courts in each of the states and territories that are there to deal with these issues.

In the year ending 30 June 2020 there were 12,850 applications to NCAT Guardianship Division in NSW. That on average is approximately 247 applications each week.

The tribunal hears various types of matters including guardianship orders for people who have not made an Enduring Guardianship appointment and then that person has lost capacity so can no longer make that appointment.  A medical or accommodation issue can arise and then decisions need to be made for that person.  Of the 2019-2020 applications 57% resulted in the Public Guardian being appointed to make decisions for the person. Decisions are therefore removed from family members.

The application numbers are similar for people who have not made an Enduring Power of Attorney and a financial or property matter arises and decisions need to be made for the continued management of their financial affairs. These affairs can include the person’s property, tax affairs, banking, shares, investments and superannuation. Of the 2019-2020 applications, 52% resulted in the NSW Trustee and Guardian being appointed. This effectively removes any control from the person’s family for financial decision making.

The tribunal can also review appointments where for example an appointee is not acting in the interests of the person who appointed them and they need to be called to account.

The majority of applications were made for people aged 75 and over.

It is a reminder that as the population ages it is crucial to make time to get your estate planning affairs in order to give you peace of mind about precisely who will have authority to make substituted decisions for you if you become incapable and also provides you with an opportunity and advantage to express your wishes and intentions to your substituted decision maker while you are well.

39% of all applications to NCAT involved people who had been diagnosed with dementia. Other categories that were identified in applications during that year were: intellectual disability, mental illness, neurological and brain injuries.

If you answered the opening question with the above with a “Yes”, you have probably made an Enduring Power of Attorney and an Enduring Guardianship appointment. Even if you have, it is wise to review it from time to time to make sure what you did in the past reflects your current wishes.

Our estate planning team at Owen Hodge Lawyers are very experienced in NCAT matters and proper planning for the future to provide you with the peace of mind that you have covered these issues and that you have clarity, direction and security into the future. Don’t hesitate to contact us today on 1800 770 780, or via email at [email protected]. We look forward to working with you.


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