Power of Attorney and Enduring Guardianship: What is it?
No matter how hard we may try, aging is a fact of life and no one is immune. Some people may be fortunate and grow old without experiencing any major issues, while there’ll be others that may have to deal with a number of problems as they age, and require help with finances and health related matters. One option for a person who is no longer able to care for themselves, is delegating to another person the power to manage their affairs through guardianship.
When does a person need guardianship?
Guardianship is used for the protection of anyone who is unable to care for themselves anymore due to intellectual, physical, psychological or advanced age reasons. All states and territories have guardianship legislation in place and for the most part, the legislation is focused on a person’s lack of ability to take care of their own affairs.
If the person has not appointed an Enduring Guardian whilst they had the required capacity to do so, a Guardian can be appointed by the Guardianship Tribunal.
When determining whether or not a person needs protection, the Guardianship Tribunal will have to be satisfied that the person is in need of a guardian after a hearing an application. The Tribunal will consider a reference person (the person requiring care) to have a disability if:
- the person is intellectually, physically, psychologically or sensorily disabled;
- the person is of advanced age;
- the person is considered as mentally unfit in accordance with the relevant legislation;
- the person is otherwise disabled; and who by virtue of that fact, is restricted in one or more major life activities to such an extent, that the reference person requires supervision or social habilitation.
In PY v RJS (1982) 2 NSWLR 700, Powell J set out his view of when a person requires care, treatment or control for their own good, with his Honour stating that a person is incapable of being able to look after themself if it appears there is a real risk of :
- inflicting serious injury on him or herself;
- sustaining serious injury by reason of being unable to adequately protect him or herself against such a risk;
- serious deterioration in the person’s general health or well-being by reason of the person being unable to take reasonable adequate steps to prevent such deterioration occurring.
The general principles of a guardian
Although all laws regarding guardianship are broadly similar across Australia, the differences lie in the details. Using s 4 of the Guardianship Act 1987 (NSW)(the NSW Act) as an example, the general principles that guardians must observe in respect to a person with a disability are as follows:
- the welfare and interests of such persons are of paramount consideration;
- the freedom of decision and action of such persons should be restricted as little as possible;
- such persons should be encouraged, as far as possible, to live a normal life within the community;
- the views of such persons should be taken into consideration in the exercising of such functions;
- preserving the family relationships, cultural, and linguistic environments should be recognised, and its importance;
- such persons should be encouraged, as far as possible, to be self-reliant in matters relating to their financial, domestic and personal affairs;
- such persons should be protected from neglect, abuse and exploitation;
- the community should be encouraged to promote and apply such principles.
How is a guardian appointed?
In order for a person to meet the eligibility requirements for appointment as a guardian, they must be at least 18 years of age, and two or more people are able to be appointed to the role. However, if the Public Guardian is appointed, that person will be the sole guardian.
When appointing a guardian, the tribunal must be satisfied that:
- the personalities of the guardian and the person under guardianship are compatible;
- there is no undue conflict of interest;
- the potential guardian is willing and able to exercise the functions which will be imposed by the guardianship order.
Before the tribunal appoints the Public Guardian, it must be satisfied that there can be no other circumstance where another person can be appointed to the role.
Choosing your own guardian
Any person above the age of 18 who has the required capacity can appoint another person to be a guardian using an instrument in writing that conforms to the forms prescribed by the relevant regulations. The appointment only takes effect for the duration of time that the appointor requires the assistance of a guardian, and the person is appointed as an enduring guardian. In order for a guardian to be validly placed in the role, an instrument should be signed by an appointor or someone who is eligible to sign on their behalf, with the appointor present.
Furthermore, the appointee must accept the endorsement and at least one eligible witness must be present.
Two or more people can become enduring guardians and the instrument of appointment bestows the authority on the appointee the following functions:
- to decide where the person is to live;
- to decide what health care the person is to receive;
- to decide what personal services the person is to receive;
- to consent to medical and dental treatment;
- to decide any other function outlined in the instrument.
Alternatively, a person cannot be appointed as a guardian if they are involved in the provision of services in a professional or administrative capacity, directly or indirectly involving medical services, accommodation, or any type of service predominately dealing with daily living. Additionally, a spouse, parent, child, sibling of the person providing the above services, cannot be appointed to the role.
It should be noted, that the Guardianship Tribunal has the power to review an appointment of enduring guardianship either on its own volition, or by request, and must be satisfied that it is in the best interests of the appointor to revoke an appointment. Alternatively upon review, the appointment can also be confirmed.
How much authority does a guardian have in regards to medical treatment and financial management?
Generally speaking, enduring guardians have the authority to decide where an appointer lives, and are also able to make decisions regarding health care, personal services and certain kinds of medical or dental treatment.
In New South Wales under s 7 of the Health Records and Privacy Act 2002 (NSW), and s 2A of the NSW Act, both the guardian and the person whom they are responsible for have the same right of access to medical information.
A person appointed in the role as Guardian does not have any authority in relation to financial management. If an Attorney (under Power of Attorney) has not been appointed whilst the person had the required capacity, a financial manager can appoint a financial manager through a financial management order. In regards to financial matters, the Tribunal may make a financial management order only after considering the person’s capability to manage their own affairs and is satisfied:
- the person is not capable of managing their own affairs;
- there’s a need for another person to manage the person’s affair on their behalf;
- it is in their best interests.
The dedicated team at Willis and Bowring are able to assist with all of your Estate Planning needs. If you wish to learn more about Enduring Guardianship appointments, please contact our experienced Estate Planning team on (02) 9525 8100 today.