What Are the Legal Responsibilities of an Attorney Under an Enduring Power of Attorney?

Appointing someone to manage your affairs is a significant decision. An Enduring Power of Attorney (EPA) grants substantial authority over financial and property matters of the donor (The person who gives the power). The authority given under an EPA continues even if the donor loses capacity to make decisions themselves. The person appointed carries serious legal obligations. These duties are enforceable under Western Australian law, and breach of key responsibilities can lead to personal liability.

This blog presents the core legal duties imposed on the appointed person. It also explains fiduciary obligations, record-keeping requirements, and conflict rules.

What Are the Legal Responsibilities Under an Enduring Power of Attorney?

The main responsibility of the donee is to protect the donor’s interests. With an EPA, the donee gains considerable control over another individual’s financial and property management. Thus, the use of such authority needs to be prudent. The main responsibilities of the donee include:

• Protect the donor’s interests: The donee should use the powers with due diligence. If a lack of diligence leads to financial loss, the donee would face liability.
• Maintain proper records: Proper records should be kept for all deals and transactions made using the EPA
• Report bankruptcy: If the donee faces bankruptcy, they should declare it before the State Administrative Tribunal.
• Stay within authority: The donee should adhere to the EPA and cannot use it for their own decisions and lifestyle.
• Avoid unauthorised delegation: This role cannot be simply passed to someone else.

Such duties provide an outline of how the financial affairs should be handled responsibly. They also make careful decision-making and documentation essential.

Managing Money and Property in the Donor’s Interests

The EPA may grant broad powers concerning financial and property matters, according to the terms of such an agreement. However, it does not authorise personal decisions or treatment or lifestyle choices. The distinction is intended to ensure that financial powers are not used in situations where they are not authorised by law.

Before making any decisions, the donee must take into consideration the valid financial needs of the donor. It would be improper to make a decision based only on convenience or because of family pressure.

What Records Must the Donee Keep?

Proper records will help prove the decision-making process and how the funds of the donor have been used. They may also become important if the Tribunal examines the EPA. Some of the main records that a donee must keep in a safe and accessible place are:

• Bank statements
• Invoices and receipts
• Information about important real estate transactions
• Transactions conducted on behalf of the donor
• Explanation of any unusual transaction

What Are the Limits on the Donee’s Authority?

A donee cannot make a will on behalf of the donor, make decisions about personal affairs or treatment, or handle trust property simply because they have the EPA. It is important to know about these restrictions before making a decision. If authority is uncertain, enduring power of guardianship legal advice or Tribunal directions may help reduce the risk of an improper decision.

What Happens if There Are Concerns About the Donee’s Conduct?

In case any problems arise, the State Administrative Tribunal may look into the EPA and make demands for documents or accounts. The tribunal may also make any orders on the powers of the donee, even go so far as to replace the EPA with an administration order if need be.

These concerns may include suspected misuse of money, lack of proper accounts or even decisions that do not seem to be in the best interests of the donor. A person with a proper interest can raise these concerns through the Tribunal.

When Should You Seek Legal Guidance?

You may consider seeking legal assistance when making a decision that would have substantial monetary implications, lack of clear powers, complex asset management, or the risk of conflict. This might involve major property deals or any confusion regarding the lawfulness of the action proposed within the framework of the EPA. Another option is to approach the Tribunal for directions concerning the exercise of power and interpretation of the terms of power.

Conclusion

An EPA comes with substantial legal obligations to fulfil. Under the laws of Western Australia, a donee is expected to make reasonable efforts to safeguard the interests of the donor, keep proper records, and operate within the limits of the power. If any queries related to finances or the abuse of powers arise, the State Administrative Tribunal can take up the matter for investigation. For a donee, thorough record-keeping and making proper judgments are extremely important. If the authority granted by the EPA is unclear or a proposed transaction carries significant risk, seeking guidance from wills and probate lawyers before acting can help protect both the donor’s interests and the donee’s position.