A person makes an enduring power of attorney (EPOA) to entrust decisions about their personal (including health) and financial affairs to another person when they lose capacity to do so, under the Powers of Attorney Act 1998.
The ‘greying’ of Australia, with more people living longer lives, means about one in 10 Australians over the age of 65 will experience dementia.
This makes an EPOA a particularly important legal document to consider before the possibility of losing capacity arises.
But what happens in the event a person fails to take this step? Either through oversight or because they don’t see the importance of this document, many people may not have an EPOA in place when they lose capacity to make decisions for themselves.
An EPOA can’t be made once a person loses capacity as it will not be valid.
Appointment as administrator or guardian
Where a person has no EPOA in place but is no longer able to make their own personal and/or financial decisions, a family member, close relative, close friend or a professional known to the person such as a lawyer or a financial adviser may be able to fulfil the role.
In Queensland, this requires an application to the Queensland Civil and Administrative Tribunal (QCAT) by the person who wishes to look after the interests of the person who has lost capacity to be appointed as his or her administrator (for financial decisions) and/or guardian (for personal and health decisions).
The person with impaired capacity to make a decision can also apply to QCAT on their own behalf.
A person making such an application should be aware it can be a time-consuming and costly process.
How does the QCAT process work?
In cases where an application is made to QCAT to become someone’s administrator or guardian, there can often be a dispute about whether the principal has lost capacity for some or all matters.
The Tribunal is able to make a declaration about that person’s decision-making capacity in order for the application to proceed.
In addition, a person making an application to be administrator and/or guardian of a person who has lost capacity must be over the age of 18, must not be a paid carer or health provider for the person and must not be bankrupt.
QCAT also takes into account a number of other factors related to the competency and appropriateness of the person who wishes to be appointed as another’s administrator or guardian.
Specifically, the applicant must not have conflicts of interest in regard to the affairs of the principal; be compatible in terms of communications with the person whose interests they wish to represent; be available and accessible, and; have the competency to carry out the functions of the role/s.
Applicants with a criminal record, or who have filed for bankruptcy, or who were previously removed from appointment as an attorney or guardian, will be likely barriers to the success of their application.
What happens if an applicant is successful?
An appointment as a guardian and/or administrator may be for a term of up to five years.
The appointed person cannot be paid but can claim reimbursement for reasonable expenses incurred in performing the role.
QCAT retains the ability to review the appointment of an administrator or guardian and remove a person from the role under certain circumstances.
If there is no one who can be appointed as an administrator or guardian for a person who has lost capacity, if there is conflict between family members or if QCAT holds no confidence in the person to manage the affairs of the person who has lost capacity, then the Public Trustee may be appointed to manage that person’s financial affairs while the Public Guardian may be appointed to decide on personal/health matters. The Public Trustee charges fees for performing its role.
Legal advice from respected, experienced professionals should be sought in regard to any of the issues discussed in this article. At Big Law, we are specialists in this area, with wide experience in appearing on behalf of our clients at QCAT in the event there is no enduring power of attorney.