An enduring power of attorney (“EPOA”) gives another person (“the attorney”) the power to make all sorts of important decisions for you even after you lose the capacity to make these decisions for yourself. As it concerns financial decisions, this can include paying your debts, selling your assets, and running your business.
Because an EPOA gives so much power to an attorney, we recommend considering the following matters to minimise the risk that the attorney may abuse this power.
Just like putting guard rails on a highway aims to prevent cars from veering off the road, these matters can help keep an errant attorney on the right track.
- Appointing multiple attorneys
Appointing just one person to be your attorney can create an opportunity for that person to more easily abuse his or her power. Instead, consider appointing more than one attorney, preferably to act jointly so all decisions need to be made unanimously. This ensures that no one person holds all the power. This needs to be balanced against the practical requirements for the attorneys to make decisions promptly so if some of them live far away or if they do not get along, such an appointment is unlikely to work. - Appointing a professional attorney
In addition to appointing multiple attorneys, you could also consider having one of them be a professional advisor such as an accountant or solicitor. Please be aware though that such professionals will usually expect to be remunerated for acting as an attorney so you need to make sure your estate is large enough to afford this expense. - Requiring an attorney to notify others
You could also require your attorney to notify specified people of any decisions he or she makes. The attorney could further be required to disclose certain financial information to such third parties. This allows for an attorney’s decisions to be supervised without fettering his or her ability to make decisions by seeking agreement from other attorneys. - Including important wishes in the EPOA
Finally, where you have firm wishes on certain lifestyle choices, it may be advantageous to include these in the EPOA. By doing so, you not only help ensure these wishes are followed by your attorney, but you also provide grounds for someone else to bring an action against the attorney if he or she unreasonably ignores your clear wishes. Such wishes could include, for example, destinations you would like to regularly visit or meals you would like to enjoy.
Of course, none of these matters can ever completely stop a malicious attorney from abusing his or her power, which is why it is so important to choose the right attorney (please see our earlier blog post “I’ve Got the Power!” – Choosing the Right Attorney). Nevertheless, these matters can make it more difficult for the attorney to do the wrong thing.
If you do not have a valid EPOA in place or you would like to update an existing EPOA, please contact us and book a consultation today.
By Max Williams – Special Counsel
More on Wills and Estate Planning