Understanding Powers of Attorney

What is a Power of Attorney?

A Power of Attorney is a legal document allowing an individual (Principal) to appoint another person (Attorney) to make decisions and take actions on their behalf.

In the State of Victoria, Australia, these documents are governed by the Powers of Attorney Act 2014 and the Guardianship and Administration Act 2019.

Types of Powers of Attorney

General Power of Attorney

Grants broad authority to the Attorney to make decisions and perform tasks on behalf of the Principal. This can include managing financial affairs, making investments and buying and selling property.

Specific Power of Attorney

Limits the Attorney's authority to specific tasks or decisions, which can include authority to sell a specific property, manage a specific bank account or make medical decisions on the Principal's behalf.

Enduring Power of Attorney

Remains in effect even if the Principal becomes physically or mentally incapacitated. An Attorney is appointed to manage the Principal's affairs and make decisions on their behalf if they are unable to do so. Within an Enduring Power of Attorney, the Principal can nominate if the Attorney will have powers with respect to either financial matters, personal matters, or both:

• Financial matters in an Enduring Power of Attorney refer to the management of the Principal's financial affairs, including the management of bank accounts, investments, and the buying and selling of property.
• Personal matters in an Enduring Power of Attorney refer to the management of the Principal's personal affairs, including decisions related to their accommodation, care and lifestyle (but not medical matters).

An Attorney appointed for personal matters has no authority over the Principal's financial matters, and an Attorney appointed for financial matters has no authority over the Principal's personal matters unless both powers are granted in the Enduring Power of Attorney.

Medical Treatment Decision Maker Appointment

Formerly known as “Power of Attorney (Medical)”, the appointed decision-maker makes medical treatment decisions on behalf of the Principal when the Principal is unable to do so.

• An Advance Care Directive is a legal document that allows an individual to provide guidance to their Medical Treatment Decision Maker and/or to express their wishes in regard to the type of medical treatment they would like to receive if they are unable to make decisions for themselves.

Legal requirements for validity

It is important to note that the Powers of Attorney must be executed in accordance with the Powers of Attorney Act 2014 and the Guardianship and Administration Act 2019 to be valid. To ensure a Power of Attorney is legally valid in Victoria, it must adhere to the following criteria:

Fiduciary Duty

The Attorney is obligated to act in the best interests of the Principal and adhere to any instructions specified in the Power of Attorney document.

Revocation and Changes

The Principal can amend or revoke the Power of Attorney at any time while they have the capacity to do so. The document becomes null and void upon the Principal's passing.

Witnessing

The document must be signed in the presence of two witnesses over the age of 18. One of these witnesses must be an authorised individual, such as:

• a lawyer;
• a justice of the peace;
• a police officer;
• a doctor;
• a nurse practitioner;
• a dentist;
• a pharmacist;
• a teacher;
• a bank officer;
• a postmaster or postmistress;
• a member of the Australian Federal Police;
• an Australian consular officer or an Australian diplomatic officer;
• a member of the Victoria Police; or
• an employee of the Commonwealth authorised under a law of the Commonwealth to make statutory declarations.

At P&B Law, we can help explain what Powers of Attorney you require and what conditions they should contain, as well as prepare the actual documents and arrange for them to be signed and witnessed to ensure they are fully valid and enforceable.