I am often asked the difference between an Enduring Power of Attorney and an Enduring Power of Guardianship*. Many people assume that when they appoint an attorney, that person assumes the role of decision maker in all aspects of their lives. But this is not correct, as the roles of Attorney and Guardian* are separate and unique and are defined by legislation.
(*Note: From 1 July 2014 Advance Care Directives replaced Enduring Powers of Guardianship – see our article on Advance Care Directives).
Put simply, an Attorney is someone appointed to make financial and legal decisions, while a Guardian* is appointed to make personal, lifestyle and medical decisions (but only if the donor has lost mental capacity). Attorneys and Guardians* are appointed pursuant to different legislation and via separate documents. Whilst a donor can appoint different people, most people tend to choose the same people to act in both roles.
Of course, we don’t know when we might be struck down by accident or illness and what our situation might be at the time. In my opinion therefore, everyone who is 18 years old or over should consider having an Enduring Power of Attorney and Enduring Power of Guardianship*. As we get older and our lives become more complicated the need to have these documents in place increases.
The differences between the Powers are summarised in the following table:
Types of decisions that can be made/actions taken
- Financial and legal decisions;
- Can sign legal documents on your behalf
- Personal/lifestyle decisions e.g. where will you live?
- Medical decisions, e.g. to consent or refuse medical or dental treatment.
When the appointment becomes effective
- Only in the event that you are mentally incapacitated and cannot make your own decisions; or
- Immediately upon signing the document and the power continues even though you may become legally incapacitated in the future.
Only in the event that you are mentally incapacitated and cannot make your own decisions.
When the appointment ends
- When you revoke the appointment with notice to your Attorney;
- When the appointment is revoked by a Court;
- When you pass away;
- When you revoke the appointment with notice to your Guardian;
- When the appointment is revoked by the Guardianship Board; or
- When you pass away.
Who can be appointed
Anyone over 18, or more than one person appointed jointly, or jointly and severally.
Anyone over 18, except for a person professionally or administratively involved in your medical treatment. More than one person can be appointed jointly, or jointly and severally.
Conditions that can be included
The appointment can be made subject to conditions, limitations or exclusions. Generally there are no conditions but the donor may exclude certain property.
The document can be used to give your Guardian specific (or general) instructions about the types of medical care you do or do not want, which the Guardian must follow.
Governing legislation
Powers of Attorney and Agency Act 1984 (SA)
Guardianship and Administration Act 1993 (SA)
Both your Attorney and Guardian must act with due diligence in your best interests. The Court and the Board each have powers to deal with Attorneys and Guardians* who do not perform their duties correctly. But of course, your Attorney and Guardian* will have a large amount of discretionary power to do what they want and so it is of the utmost importance that you only appoint someone that you trust implicitly. Generally I recommend close family or friends are the best choice and perhaps a trusted solicitor or accountant if independence is very important (but remember that professionals will want to be paid for their time).
Depending on the specific circumstances there are a number of options in terms of how to appoint Attorneys and Guardians*. It may be appropriate to appoint one person only or a number of people. In some situations I recommend an appointment whereby “any two of the following people” can act. An appointment may only become effective upon the happening of some event (such as the proposed Attorney or Guardian* attaining a minimum age). It is always important to consider and discuss who will act as substitute if the first choice is unable to act or to continue to act.
If you are concerned about ensuring that appropriate people will look after your affairs in accordance with your wishes, should you suffer an accident or other incapacity, then I strongly recommend preparing both an Enduring Power of Attorney and Enduring Power of Guardianship*.
(*Note: From 1 July 2014 Advance Care Directives replaced Enduring Powers of Guardianship – see our article on Advance Care Directives).
For further information please contact our Wills and estate lawyers on 8362 6400 or email Michelle Crichton. Join our mailing list to receive updates and advice on current issues.
