SAM makes an enduring power of attorney (POA), appointing his two children as his attorneys.
The appointment is drafted and witnessed by a solicitor.
Sam’s children later sign their acceptances of the role and in doing so, declare that they will act in Sam’s best interests.
The POA allows either of Sam’s children to immediately manage his financial affairs.
Sam also executes an appointment of enduring guardian (AEG), allowing either of his children to make health related decisions for him, if he lacks the capacity to make the decisions himself.
Sam is later diagnosed with Alzheimer’s dementia and his children take an active role in managing his affairs.
Sam’s daughter later alleges that her brother has used $100,000 of Sam’s money to pay for renovations to his own home and has missed mortgage repayments on a mortgage on Sam’s home.
The daughter makes an application to the Guardianship Division of the NSW Civil and Administrative Tribunal (NCAT), to review the management of Sam’s affairs and seeks the removal of the son as attorney and guardian.
Sam’s son says that the $100,000 was a gift.
NCAT decides that it would not be appropriate to remove just one of Sam’s children from the role of attorney and appoints the NSW Trustee and Guardian (TAG) to manage Sam’s financial affairs.
This order gives TAG the power to further investigate the alleged misappropriation of funds.
NCAT also rules that the “poor communication” between the guardians, does not warrant the revocation of the AEG and in the absence of evidence that Sam’s welfare has been adversely affected, confirms that AEG appointing both children.
Unfortunately, TAG is very slow to take any action in relation to Sam’s affairs and his mortgage repayments remain unpaid for several months, while investigations into the $100,000 “gift” are yet to commence.
Sam’s daughter wonders whether the review process was worthwhile and whether the result will ultimately benefit Sam’s wellbeing.
POAs and AEGs are important aspects of estate planning, but careful thought should be given to the specific terms of the appointments.
This fictional column is not legal advice.
By Manny WOOD, Solicitor
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