What to think about when choosing your power of attorney

Appointing your power of attorney (POA) is a big decision and not one you should make lightly. When choosing and appointing the right person to act on your behalf, it's important to understand what this arrangement means both for you and for the person you choose. There are a number of factors you should consider.

The power in power of attorney

A power of attorney (POA) is a legal document that allows you to appoint another person – the ‘attorney’ – to act on your behalf in legal and financial matters.

When you’re choosing a POA, the key word here is power. You need to understand that by appointing a POA, you’re potentially giving away enormous power and responsibility.

Firstly, you need to be confident that you completely trust the person you’re appointing to know what your wishes are and carry them out for you.

Secondly, you need to think about what restrictions, if any, you want to put on the authority you’re granting. For example, you might want your attorney to have the power only to do your banking and not deal with your real estate.

Kick-off considerations: when does a POA start?

By law, as soon as you sign the document and it’s accepted by your appointed attorney, the attorney has the authority to act straight away. Again, some people want to put limits on the timing. For example, they don’t want the POA to kick in until a GP certifies that they’ve lost capacity to act for themselves.

If you’re granting the authority, you can determine when it starts. However, my view is that the more restrictions you put on the document, the less useful it becomes and the harder it is to use. My advice is to pick the right person and keep the document as general and as open as possible.

Attorney cans and can’ts

Your attorney can do a wide range of things that you can lawfully do for yourself (again, subject to any restrictions you might put on the document). They can, for example:

  • buy and sell property
  • do your banking
  • pay your bills
  • communicate with all your service providers.

Depending on the state or territory in which you live, your attorney might also be able to manage your personal matters, such as medical treatment.

Among the things he or she can’t do are:

  • vote on your behalf
  • make decisions about the care or wellbeing of your children or about the adoption of a child
  • make or revoke a Will
  • consent to a marriage, a sexual relationship or the dissolution of a marriage
  • enter into a surrogacy arrangement
  • consent to breaking the law.

Revoking your POA

If you’ve still got capacity and you discover your attorney has acted illegally, you can revoke the POA.

To do so, you need to communicate to the person you’re disengaging and ask them to return any copies of documents they may have to you. Also, if your bank is aware that a POA was in place, let them know that that person is no longer your appointee. If the attorney has taken money from you or sold property without your authority, you can also take legal action to recover that loss.

With a POA, you’re not giving away your rights; you’re simply delegating responsibility to another person if the need arises.

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Andrew Simpson, Maurice Blackburn

Andrew Simpson

Maurice Blackburn Melbourne

When it comes to drafting a Will, dealing with an Estate or challenging or defending a Will, Andrew Simpson is the lawyer you want representing you. Andrew is a Principal Lawyer and the head of Maurice Blackburn’s national Wills and Estates Law practice.

With more than 25 years’ experience as a lawyer – mostly in Estate planning, Estate administra…

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