The Difference Between a Power of Attorney and Enduring Guardianship

The Difference Between a Power of Attorney and Enduring Guardianship

Enduring Power of Attorney and Enduring Guardianship are both important legal concepts of particular relevance to elderly people who no longer have the capacity to make important financial and lifestyle decisions on their own.

It’s important to note that a person can appoint one person as both attorney and guardian if they wish, though often the roles are split between two or more people for sensible reasons.

Both appointments are a wise step in a person’s estate planning for the later years of life, though are also important for those with a disability or who may experience temporary incapacity.

The appointing of an attorney or a guardian should be undertaken with the advice and guidance of legal professionals who possess the appropriate expertise and experience.

What are the essential differences between Enduring Power of Attorney and Enduring Guardianship?

An Enduring Power of Attorney is an important legal document that sees a person appoint someone they trust to make decisions on their behalf should they lose the capacity to do so.

Most commonly, those decisions relate to financial and property matters, such as managing investments, selling property and tax affairs, but can also relate to ‘personal and health’ matters.

While an Enduring Power of Attorney is often made by an elderly person who is in the process of – or fears – losing capacity, the document can be made by anyone who is incapacitated whether temporarily or permanently. Intellectual or psychiatric disability acquired brain injury, dementia or temporary illness may also be reasons for making an Enduring Power of Attorney.

An attorney empowered to make decisions on personal and health can decide where the person who loses capacity will live, who they will live with and other aspects of their living arrangements. They may also be able to make certain medical decisions, including treatment options and medicines.

An attorney’s powers are limited by the document created by the principal, provided it was made by a person over 18 and who had the capacity to understand the nature and effect of the powers they bestowed.

The attorney has a duty to make decisions which conform with what the principal expressed they wanted when they had capacity.

Enduring Guardianship: At first glance, the appointment of an enduring guardian appears to cover the same ground as power of attorney.                                        

An enduring guardian is appointed to make health, personal, lifestyle and welfare decisions on behalf of a person who loses capacity.

Unlike a power of attorney, a guardian is not empowered to make decisions on financial or property matters.

For compelling reasons, many people prefer to appoint separate people to the roles of attorney and guardian. A long-trusted financial adviser, for example, may be the best person to be appointed as someone’s attorney, while a close family member is more likely to be an appropriate guardian, making decisions on issues such as end-of-life treatment.

The increasing popularity of Advanced Health Directives (AHDs) – made by people to provide direction to family members on how they would like the last stages of their lives to be managed – are a separate issue, though a guardian is expected to pay due regard to the terms of an AHD in performing their role.

As with power of attorney, a guardian’s powers are limited by the number or types of functions nominated by the principal. Different functions can be given to different guardians. Decisions about whether a person who has lost capacity should go into a nursing home, their medical care and treatment, are common decisions made by guardians.

What about the situation where no attorney or guardian has been appointed?

If a person has not appointed an attorney or guardian and may be at risk of harm, an application can be made to the Queensland Civil and Administrative Tribunal (QCAT) for a decision-maker to be appointed.

Those with a personal or professional interest in the person’s life can make an application to QCAT if:

  • They believe the person doesn’t have the capacity to make decisions for themselves;
  • there is conflict over a decision that needs making;
  • they are at risk of abuse, neglect or exploitation.

If the Tribunal decides there is no one suitable to perform the attorney’s or guardian’s roles, the Public Trustee may be appointed to oversee the person’s financial matters and the Public Guardian is appointed to decide on their personal and/or health decisions.

Why do you need legal advice?

There are a number of formalities that need to be observed in order for an Enduring Power of Attorney or Enduring Guardianship to have legal effect, such as witnessing the signing of the documents.

In addition, an experienced wills and estates lawyer will ask the right questions to ensure the appropriate people are being appointed to these important roles, and that the instrument by which they are empowered in both correctly drafted and accurately reflects the principal’s wishes.

Both powers can also be later revoked by the principal, and legal advice should be sought before this is undertaken if deemed necessary.

What Should You Do Next

Simply contact our Melbourne,  Perth,  Sydney and Brisbane for a free no-obligation chat to learn more about how we might be able to assist you.