As our population ages, so do more people loose their capacity to make legal decisions.
However, a properly executed “enduring power of attorney”, allows a person (donor) to appoint a “personal legal representative” (LPR) to make decisions on their behalf, even if the donor looses their “legal capacity”. This avoids the costs incurred when seeking an appointment via the courts or the public trustee being appointed.
The LPR must act in the best interests of the donor. Further, the EPOA can be drafted to include multiple LPRs who are required to act jointly as a protective measure and their powers to act can be restricted to specific issues.
Self Managed Super Funds
In the case of SMSFs, the member is also a trustee of the fund, which must comply with the superannuation regulations to avoid heavy tax penalties or even closure of the fund. Consequently,the LPR could be appointed to act in place of the member should they loose their ability to do so. Also, to ensure that the fund remains compliant with the law, the EPOA could be utilised if the member was to temporarily reside overseas.
However, the solicitor drafting the EPOA will need to ensure that it fits the member’s family situation and intentions and that the SMSF trust deed and state legislation do not restrict the use of the EPOA. Also, in the case of a corporate trustee, other documents may be required to allow the EPOA to be effective.