Few people, both young and old, know how important an Enduring Power of Attorney (EPA) is. Of those people who do understand the importance of the document, even fewer understand the importance of setting up an EPA before becoming elderly. However, if unexpected life events occur, an EPA can make all the difference.
The following scenario offers an example to help explain why it is important to consider creating an EPA before it is too late.
Matt and Penny are in their mid-thirties and have two young children. Matt has a successful construction business and Penny is a school teacher. Life has been progressing well. They have purchased their own home jointly, they also have two rental properties in both of their names and considerable savings in separate bank accounts in their own names.
One morning Matt woke unable to speak or use the left side of his body. He had suffered a premature stroke. Matt and Penny soon found out it is not uncommon for young people to suffer strokes which meant that they are unable to function properly. Matt and Penny had made home-made Wills but they always considered that there was plenty of time for them to get enduring powers of attorney organised. They thought they had planned well for what would happen if one of them died but they had never considered a situation where one of them might lose capacity.
Without Matt being able to deal with any business matters or sign anything for himself Penny now found herself in the position of not being able to deal with a whole range of things that Matt had previously taken care of. Their home needed to be renovated to cope with Matt’s new medical requirements and physical restrictions. To complete the renovation Penny needs to sell one of the rental properties. She also needs to try and sell Matt’s business so that the outstanding developments can be completed.
Penny has found she cannot access Matt’s bank account, nor sign any sale and purchase agreements for the property or the business without an EPA appointing her as Matt’s attorney. Penny must now make an application to the State Administrative Tribunal (SAT) to appoint an attorney to deal with Josh’s affairs. The application to the SAT is going to delay the renovations and sale of any assets for at least 6-8 weeks as well as causing extra expense at what is already a very stressful time for Penny and the children.
Modern lives are more complicated and the documents that govern our affairs are also less straightforward than they used to be. Having an EPA can be as important as having a Will. An EPA is rather like an insurance protecting you from the risk of the unexpected happening and not being able to take care of your own affairs.
It is always better to document well upfront rather than have to deal with a stressful and messy situation due to lack of planning. If you require advice on your estate planning please get in touch with our experienced team at Lynn and Brown Lawyers.
About the Author: Barbara is a highly experienced Wills & Estates lawyer and holds a diploma in this area with the Society of Trust and Estate Practitioners (STEP), a leading network of experts in trust and estate planning.
Barbara acts in all areas of Wills and Estates, including estate planning, estate administration and trust formation for clients.
