B Hayward and Co

Category: Power of Attorney

  • I only want it to operate when I can’t manage my own affairs.

    • This is a common request but not easy to fully accommodate. Debate rages among lawyers as to how to deal with this. It is possible to put a condition in the Power of Attorney that says something like ‘this Power shall only be valid if I am unable to manage my affairs’ or ‘only to commence when my incapacity is certified by a medical practitioner’. However in practice this may be impracticable as it would mean that anyone dealing with your attorney such as a bank would have to make a judgment as to whether you were capable or the condition had been complied with. Past experience shows that they might refuse to honour the Power of Attorney for fear you would later claim you were alright and didn’t authorise the use of the document. In such cases, there would be no point in having the Power of Attorney.
    • In my experience, most people accept the difficulty of limiting the use of the power of attorney by reference to their mental capacity. Other lawyers may disagree with the problems I foresee in trying to make it conditional upon such mental health. The difficulty is that the question won’t be tested until you have lost capacity and then won’t be able to sign another document to fix the problem. The best advice is to appoint more than one attorney and only people you trust.

  • How is it Created?

    • A power of attorney is created by signing a document that is usually prepared by a lawyer. It authorizes the person(s) named to act on your behalf. It does not need their signature. It can only be given by a person who understands the meaning of the document at the time.
    • The attorney(s) is legally obliged to act on your directions if you are able to give any and they would be guilty of a crime if they just took your money and spent it without your authority (if you were able to understand and give that authority).

  • What is Power of Attorney?

    • A document you sign that authorizes others to sign financial documents in your name and on your behalf. (They act as your agent)
    • This means you can be legally bound by a document they have signed even though you have not seen or signed it.
    • The document generally authorizes the attorney to manage your financial affairs (subject to any restrictions you have stated in the document).
    • The Power of Attorney can be limited to only doing certain things (ie. Only dealing with the sale of a property) or limited to not authorising the sale of a property or limited

      in time (ie. Only while you are on holidays etc)
    • The Power of Attorney is signed by you and (since 16.2.04) your attorney. Powers of Attorney entered into before 16th February 2004 were not signed by the attorney but are still valid despite this change.
    • The person who gives a power of attorney is called a donor and the person(s) who receive it are called the donee(s).