A Power of Attorney is a legally binding document that grants another individual (or individuals) the authority to manage your financial matters on your behalf. For this reason, it is important that you appoint people you trust.
It is recommended that you appoint a substitute (or multiple substitute) attorneys in the event that the primary person you choose is unable or unwilling to perform their duties when the time comes. It could be that the primary person has passed away, or lost capacity themselves – and in these circumstances the substitute attorney can step in and take the reins.
But what happens if the primary attorney just can’t or won’t perform their duties?
An attorney is legally obligated to act in your best interest. Legally they cannot:-
- Use your money to benefit themselves, or someone else
- Disregard your views, wishes and existing relationships, values and culture
- Breach your confidentiality
Sadly, at times the person appointed as primary attorney does not do what they need to do. In these circumstances it may be necessary for the alternative attorney to seek legal advice/assistance so they can step in. In accordance with the Powers of Attorney Act 2003, the substitute person is only able to act if the primary person has ‘vacated office’, for example if:-
(a) the attorney dies, or
(b) the attorney becomes bankrupt, or
(c) the attorney, by reason of any physical or mental incapacity, ceases to have the capacity to continue to act as an attorney.
If the primary attorney cannot act – the secondary attorney will need to prove this in order to activate their powers. For example, if the primary attorney has lost capacity, a medical report will be necessary. In some cases, this proof is relatively easy to acquire, in other situations it is more complex. For example, where a person may want to continue to act as primary attorney, and has no medical or other impediment in the way – but they are simply not up to the task. In these situations it may be necessary to go to NCAT (NSW Civil & Administrative Tribunal) to seek appropriate orders.
If you are an attorney, or substitute attorney, and need assistance in understanding your duties – or if you are considering making or updating a Power of Attorney – these are situations that you may wish to consider. If you need advice or assistance, please contact our Wills & Estates team today.
