When a person loses capacity to make decisions, it can have significant legal and practical implications, particularly when the sale of property is required to fund their care or meet other financial needs. In Western Australia, the absence of an Enduring Power of Attorney (EPA) can complicate and delay the process, creating challenges for families and loved ones.
What is an Enduring Power of Attorney?
An Enduring Power of Attorney is a legal document that allows a person (the donor) to appoint someone they trust (the attorney) to make financial and property-related decisions on their behalf. Unlike a general power of attorney, an EPA continues to operate even if the donor loses capacity due to illness, injury, or age-related conditions. In Western Australia, EPAs are governed by the Guardianship and Administration Act 1990 (WA).
The Consequences of Not Having an EPA
If a person loses capacity and does not have an EPA in place, no one automatically has the legal authority to manage their financial affairs, including selling property. This can be particularly problematic if the sale of a property is urgently needed to fund the person’s care or meet other financial obligations. Without an EPA, family members or other interested parties must apply to the State Administrative Tribunal (SAT) to be appointed as an administrator. This process can be time-consuming, costly, and emotionally taxing.
The Role of the State Administrative Tribunal
The SAT is responsible for appointing administrators to manage the financial affairs of individuals who have lost capacity and do not have an EPA.
The process of appointing an administrator through the SAT can take weeks or even months, depending on the complexity of the case and the availability of evidence. During this time, the person’s financial needs may go unmet, and the property sale may be delayed. Additionally, the SAT process can be stressful for families, particularly if there are disputes over who should be appointed as administrator. It may involve legal fees, application fees and costs associated with obtaining medical evidence. The administrator’s powers are limited to those specified in the SAT order, which may not cover all financial decisions, resulting in potential further applications to SAT.
The Benefits of Having an EPA
Having an EPA in place can prevent these delays and challenges. An EPA allows the appointed attorney to act immediately if the donor loses capacity, ensuring that financial decisions, including property sales, can be made without the need for SAT involvement. This can save time, reduce costs, and provide peace of mind for families. By creating an EPA, individuals can ensure that their financial affairs are managed smoothly and efficiently, even if they lose capacity.
If you feel you could use some specialist advice, don’t hesitate to contact the Estate Planning team at Lynn and Brown.
Author: Barbara Delaney, Barbara is a highly experienced Wills & Estates lawyer and holds a diploma in this area with the Society of Trust and Estate Practitioners (STEP), a leading network of experts in trust and estate planning.
Barbara acts in all areas of Wills and Estates, including estate planning, estate administration and trust formation for clients.
Barbara appreciates the sensitivity for many people in this area and works with her clients to ensure that they feel comfortable and well informed. Her role is to assist clients through each stage of the process with compassion and ensure they understand each stage.
Barbara is passionate about advising individuals and families to ensure their estate planning is comprehensive and appropriately meets their needs. Having a good estate plan in place can put your mind at ease and that is something everyone should consider – you never know what is around the corner!
