A Power of Attorney is a legal document that a person (called the ‘Principal’) uses to appoint another person (referred to as an ‘Attorney’) to make decisions on his or her behalf.
On 1 September 2015, the Powers of Attorney laws in Victoria changed. The new legislation is the Powers of Attorney Act 2014 (the Act).
The main purposes of the Act are to consolidate and simplify the Enduring Power of Attorney laws in Victoria and to improve some of the protections against elder abuse.
Under the new law, a General Power of Attorney is now called a "General Non-Enduring Power of Attorney." The Act also combined the previous Enduring Power of Attorney (financial) and Power of Guardianship into one Enduring Power of Attorney form. If you have a Power of Attorney that was made prior to 1 September 2015, then it will remain valid.
No change was made to the Enduring Power of Attorney (medical treatment) form and the same form should continue to be used (until 12 March 2018). These types of Powers of Attorney are governed by the Medical Treatment Act 1988.
In Victoria, there are 4 different types of Powers of Attorney:
- General Non Enduring Power of Attorney: appoints another person to make financial/legal decisions on the Principal's behalf. For example, for the sale of a property while the Principal is overseas. It ceases to operate if a person loses decision-making capacity.
- Enduring Power of Attorney: appoints a person to make financial, personal and some medical decisions on the Principal's behalf, including consenting to medical treatment. Unlike a General Power of Attorney, it will continue to operate should the Principal lose decision-making capacity.
- Enduring Power of Attorney (medical treatment): appoints a person (called the 'medical agent') to refuse medical treatment should the Principal lose decision-making capacity.
- Supportive Power of Attorney: appoints a support person to help give effect to the Principal's own decisions. It does not give the Attorney the power to make decisions on the Principal's behalf but allows the Attorney to act as an advocate to help give effect to their decisions.
The Act combined the previous Enduring Power of Attorney (financial) and Power of Guardianship into the same Enduring Power of Attorney form.
This means that the Enduring Power of Attorney can be used to appoint another person to make financial and personal (including some medical decisions) on the Principal's behalf.
An Enduring Attorney will have the power to consent to medical treatment on the Principal's behalf, but will not be able to refuse medical treatment. If a person wants to appoint another person to refuse medical treatment on their behalf, then the Enduring Power of Attorney (medical treatment) should be used.
The Act has also made more stringent requirements for the making and revoking of Enduring Powers of Attorney. For example, 2 eligible witnesses must be present when the Principal signs an Enduring Power of Attorney.
One of the purposes of the Act is to improve the protections against the abuse of Enduring Powers of Attorney. You can only make your own Power of Attorney if you have decision-making capacity.
This is defined in the Act as being able to:
- understand the information relevant to the decision and the effect of the decision;
- retain that information to the extent necessary to make the decision; and
- use or weigh that information as part of the process of making the decision; and
- communicate the decision and the person's views and needs as to the decision in some way, including by speech, gestures or other means.
A person is presumed to have decision-making capacity unless there is evidence to the contrary.
The Act further aims to protect the Principal by guiding the Attorney's powers and the decisions that they make on the Principal's behalf. An Enduring Attorney must:
give effect to the Principal’s wishes;
encourage the Principal to participate in decision-making; and
- promote the Principal’s social and personal wellbeing.
The Act also places further obligations and duties on Attorneys, including a duty to act honestly, diligently and in good faith, and to exercise reasonable skill and care. There are also specific prohibitions against transactions that may cause a conflict and gifts using the Principal's money.
Finally, the Act creates serious offences for fraudulently obtaining or using an Enduring Power of Attorney, which are punishable by imprisonment.
A Supportive Attorney is a person that the Principal appoints to provide support or to give effect to some, or all of their own decisions. A Supportive Attorney does not make decisions on behalf of the Principal.
The role of the Supportive Attorney vastly differs from that of an Attorney appointed under a Power of Attorney. A Supportive Attorney is not the decision-maker. The Supportive Attorney provides support for the Principal to make their own decisions (for decisions other than significant financial transactions). Whereas, an Attorney appointed under a Power of Attorney makes decisions and 'stands in the shoes' of the Principal.
The appointment is available to anyone who has capacity to make their own decisions but may need support to make those decisions, such as someone with a disability.
Further changes to the Enduring Power of Attorney laws were made in 2017. These changes will apply from 1 May 2017. A summary of the changes are as follows:
- a Principal can allow an Attorney to ‘do anything’ or can specify that an Attorney will only have powers or personal, financial and/or particular matters.
- any earlier Enduring Power of Attorney, Enduring Power of Attorney (financial) or Power of Guardianship is automatically cancelled, unless specified otherwise.
- you can appoint more than one Alternative Attorney for any Attorney you appoint.
- you can cancel an Enduring Power of Attorney and an Attorney can resign from his/her appointment.
Most importantly, the Enduring Power of Attorney appointment form will change from 1 May 2017. If making Powers of Attorney on or after 1 May 2017, you should ensure that you are using the updated Enduring Power of Attorney appointment form. Powers of Attorney made before 1 May 2017 remain valid.
Further proposed changes are also planned for 12 March 2018, when the Medical Treatment Planning and Decisions Act 2016 will commence. This Act will replace the current Medical Treatment Act 1988.
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This article contains information of a general nature only and is not specific to your circumstances. This is not legal advice and should not be relied upon without independent legal or financial advice, specific to your circumstances.