What Happens If You Do Not Have an Enduring Power of Attorney?

Nobody likes to think about what is going to happen to them after they decease. Who cares what happens to our money when we decease, we will not be around to use it. But what about that grey area where you are still alive but you can not make decisions for yourself. This could occur if you suffer from dementia or you may be you are in an accident and placed in a coma. In these scenarios, if you have not prepared the right document in time, then you loved ones will find it difficult to make decisions for you.

 

What Form Do I Need to Complete?

If you are looking to ensure that somebody can make health and financial decisions for you, when you are no longer able to do so, then you must prepare an Enduring Power of Attorney (EPOA). An Enduring Power of Attorney is essentially:

1. instructions you make saying who can be contacted to make decisions;

2. what type of decisions a person can make for you; and

3. when can those decisions be made.

An EPOA deals with two types of decision-making abilities on your behalf:

4. personal decisions – health care treatments, where you live, how you dress, etc.; and

5. financial decisions – who can access your bank accounts, who can pay bills on your behalf, can your

money be used towards investments, etc.

Your attorney’s ability to make decisions for you automatically stops when you pass away. The people who are most interested in whether you have an Enduring Power of Attorney are healthcare and financial providers. This is because they have strict security requirements and want to make sure that only you and your authorised persons can do anything with your precious health and money.

Critically, an EPOA must be prepared by you before you lose decision-making capacity. You must be of sound mind when you give your decision-making power to somebody else. To know what is considered sound mind, check out our article on Testamentary Capacity.

 

What If an EPOA Has Not Been Prepared?

If an EPOA has not been prepared by you, then nobody can be appointed as your attorney. Instead, an appointment of an Administrator and Guardian is required. An administrator is your financial decision-maker and a guardian is your personal decision-maker. To appoint an administrator and/or guardian there are either two options:

1. a loved one (like a family member or friend) can apply; or
2. if no one is willing or eligible to apply, then the Public Guardian and Public Trustee will be appointed as your guardian and administrator respectively.

Anyone looking to apply to be your guardian and administrator must meet the eligibility requirements. Those who are eligible to apply are:

• people over the age of 18;

• not your paid carer or health provider; and

• those who have not declared bankruptcy.

 

These are the bare minimum requirements to make a person eligible to apply to become your administrator/guardian. What can also be considered (especially when there are competing applicants) is:

• any previous criminal record;

• the likelihood of the applicant’s interests’ conflicting with your best interests; and

• how the application forms were completed by the applicant.

Where Can Somebody Apply to Become Your Administrator/Guardian?

The application can only be made to the Queensland Civil and Administrative Tribunal (QCAT). This poses a number of issues, especially when somebody is applying because there is an urgent need to make a decision:

1. the QCAT is generally meant for self-represented parties. An applicant can have a lawyer assist in drafting the documents to apply to be an administrator/guardian but the lawyer cannot attend the tribunal for the applicant unless special leave is sought. The applicant must appear in the tribunal and answer the tribunal member’s questions themselves;
2. it can be costly if the applicant wants to engage a lawyer to draft an affidavit as part of the application. Affidavits and applications take more time, and are therefore more expensive for a lawyer to draft compared to the EPOA;
3. it can be a long time until the Tribunal determines who will act as your administrator and/or guardian – it can take around 3 months from the time of the application being submitted for the Tribunal to make a decision; and
4. if the Tribunal decides that the Public Guardian and Public Trustee will act as your guardian and administrator, these government bodies will not make the decisions for free, they will charge you a yearly fee for making these decisions.

 

If Somebody Is Appointed As Your Guardian and/or Administrator, Is That the End of It?

With an Enduring Power of Attorney, you only need to draft one form and,= so long as it is drafted correctly, that is all you need to do. It does not work the same with somebody has applied to the Tribunal to become your guardian and/or administrator. When the Tribunal appoints somebody as your guardian and/or administrator, the appointment is for a term of up to 5 years. After 5 years, that person must re-apply to become your guardian and/or administrator.

 

Risks of Not Having an EPOA

While it’s not pleasant to think about what will happen when you cannot make decisions, it is necessary to ensure you have the document prepared and ready to use just in case the worse does happen unexpectedly. If you do not have an EPOA prepared, then:

• you may not get to decide who you want to be your decision-maker. Somebody will get to choose this on your behalf and ultimately if more than 1 person applies the Tribunal gets to determine who is more appropriate to make decisions for you;

• the tribunal application will be costly and may end up being a reimbursement from your personal monies to your attorney;

• an application to QCAT can take up to 3 months and you may not have 3 months to wait for a decision-maker to be appointed; and

• worse comes to worse, a trusted person may not make decisions for you, the Public Guardian and Public Trustee may make decisions for you.

Having an EPOA in place can reduce these headaches. You get the autonomy to decide who will make decisions for you, what type of decisions they can make and when. You can also avoid going the tribunals involvement by preparing an EPOA before you lose decision-making capacity.

If you have any questions or require assistance with an Enduring Power of Attorney matters in Queensland, then please contact the property team at NB Property Law for more information