Are you traveling overseas and want someone to make decisions on your behalf while you’re not there?
Or do want to entrust your personal matters to someone just in case something happens to you?
Appointing someone you trust as a power of attorney is a good way to have preparations in place in case something happens. Not only this, but should an important decision need to be made, a power of attorney will ensure your wishes are met.
This article will discuss the difference between a general and enduring power of attorney. Essentially, an enduring power of attorney will be able to make decisions where the capacity of the appointer has diminished.
What is a power of attorney?
A power of attorney is a legal document that you can use to grant another person authority to make decisions on your behalf on specific matters, such as legal and financial, in the occasion that you are incapable or busy. You can find more information on what is a power of attorney in our previous guide.
A general power of attorney can be used to appoint someone to make legal and financial decisions on your behalf for a period of time. The following are examples of situations where you can appoint someone else to making decisions on your behalf:
- Operating your bank account for you while you are on holidays;
- Voting at meetings on your behalf; or
- Selling your house while you are in hospital.
A general power of attorney only operates when you can still make your own decisions, and ends if you have lost the capacity to make your own decisions. Each state has a different meaning of capacity; for example in NSW the standard is where a person is totally or partially incapable of managing themselves, while Victoria has multiple standards to the same effect.
A general power of attorney cannot be used to appoint someone to make personal decisions, such as health-related matters, on your behalf.
An enduring power of attorney can be used to appoint someone to make legal, financial and personal decisions (only in Queensland and Australian Capital Territory) on your behalf once you have lost capacity. The following are examples of situations where an enduring power of attorney would benefit you:
- Operating your bank account while you are in a coma; or
- Choosing the right diet and dress for you if you suffer from dementia.
An enduring power of attorney can start immediately if it appoints another person to make legal and financial decisions, not for personal decisions. The power for someone else to make personal decisions starts once you have lost the capacity to make decisions for yourself.
It must be noted that some jurisdictions do not allow an enduring power of attorney to appoint someone else to make personal decisions on your behalf. For example, New South Wales requires an enduring guardian to be appointed for such personal decisions. You will need to check with each state’s requirements before submitting an application for an enduring power of attorney.
To summarise the differences:
|General Power of Attorney||Enduring Power of Attorney|
|Matters that can be addressed||Legal and financial||Legal, financial and personal (in QLD and ACT)|
|Start date||Legal, financial: from declared date||Legal, financial: from declared date|
Personal: once you have lost capacity
|End date||Once you have lost capacity||Once you have regained capacity|
Both general and enduring powers of attorney can allow you to place your matters in the hands of someone you can trust. If you would like more advice about powers of attorney, or which power to use in your situation, an estate planning lawyer can advise you on your options.
Need more information? Contact a LawPath consultant on 1800 529 728 to learn more about customising legal documents and obtaining a fixed-fee quote from Australia’s largest legal marketplace.