Have you ever appointed an attorney under a Power of Attorney? Did you know that there are limits to their power?
A Power of Attorney enables one or more people to make financial decisions on your behalf. This could include operating your bank accounts, paying bills, paying rent, buying and selling real estate (if registered) and signing legal documents.
Your attorney must always act in your best interest.
Attorney responsibilities
Your attorney has certain obligations that they must follow. They may face penalties and possible jail time if they act outside their power.
Your attorney’s obligations are to:
· Never mix their money with yours
· Always maintain proper records of every transaction and dealing with your property
· Always acting in your best interest and avoiding any conflicts of interest
· Cannot give themselves or others a gift from your finances unless you allow it
Elder Abuse
Older people are particularly vulnerable, especially when they have lost capacity. A government agency only intervenes once the misuse of power is reported and this is often only after the damage is done. This places the attorney in a position of great trust. Once a Principal loses capacity they rely on other people reporting their attorney.
The Elder Abuse Hotline reported that 68.5% of all calls in 2019-20 involved financial abuse of elderly people.
Revocation of attorney’s power
You may revoke an attorney’s power at any time. There is no specific form that needs completing. But, your revocation must have your name, the date of the Power of Attorney, the registered number (if applicable) and the words ‘hereby revoke’.
You should also communicate your revocation to your attorney and ask them to dispose of any copies of your Power of Attorney.
What to do if you suspect your attorney is misusing their power
First, you will need legal advice from an experienced wills and estates lawyer, as they will review the Power of Attorney document to determine the extent of the attorney’s power. But, if you lose your capacity your lawyer will take the matter to the Guardianship Division of your state/territory Civil Administrative Tribunal. In NSW, NCAT (NSW Civil Administrative Tribunal) may revoke the Power of Attorney, appoint a new attorney or change its terms.
What will happen if your attorney has misused their power
Different laws apply depending on your state or territory, but you may be able to recover all or some of the monies. In Victoria, VCAT (Victorian Civil Administrative Tribunal) can order the attorney to compensate the principal or their estate. You will need an experienced wills and estates lawyer who deals with Power of Attorneys in all states and territories to assist you.
Appoint someone you trust
This goes without saying but you need to consider someone you can trust. It will need to be someone close to you, who understands your financial situation. For many parents this may be one or more of their children or for others this may be a close friend or sibling.
If you suspect your attorney is misusing their power or if you know this is happening to someone, then contact a wills and estates lawyer now.
Not sure where to start? Contact us on 0416 884 073 or email us at enquiries@adlerlegal.com.au to find out how to revoke a Power of Attorney or to just learn more about them.
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