Sunday, April 14, 2013

Enduring Power Of Attorney Could Save You Thousands Of Dollars

An enduring power of attorney (EPA) is arguably one of the most important legal documents you will sign during your lifetime along with your Will. Everyone who owns any assets at all to speak of and who is over say 40 years of age should have them.

Enduring Power of Attorney is something which is possible by virtue of the 1988 Protection of Personal and Property Rights Act. It is an important asset protection and estate planning tool and may be compared in many ways to an insurance policy in that it is one of those documents you hope will just gather dust somewhere and not be needed.

EPA's come in two types. The first is that for personal care and welfare and you can only have one attorney at a time for this purpose and clearly, as long as you have mental capacity this type of enduring power can never be invoked.

The second EPA is that for property purposes and you may have two or more attorney's if you wish. By property in this sense we mean all real and personal property which you own. The property power of attorney can act as a general power of attorney if you wish so that your chosen attorney's can act on your instructions at any time or, if you prefer, it is able to be drafted so that it only ever comes into force if you are diagnosed as having lost mental capacity.

If you do not have enduring powers of attorney in place and you lose mental capacity there is always a fallback position in the Act but the reality for you is that this will cost you a lot more money than putting enduring power of attorney in place now of your own choice. The process is one administered in the family court and it can take months to have orders sealed and at a cost of many thousands of dollars which you will inevitably be required to pay even though you may not be aware of it!

The court orders need to be renewed after two years and then again at three yearly intervals at pretty much the same cost each time. All of this can be avoided by putting in place enduring power of attorney now at what will be a fraction of the cost.

As stated at the outset, the enduring power of attorney may well be the most valuable dust gatherer you ever sign. If you ever lose mental capacity your loved ones will be very grateful you had the foresight to have them done.

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