Wills, Estates and Powers of Attorney
What is a will?
A will is a legal document which, as far as possible, ensures your assets are distributed according to your wishes after you die.
Your will can cover all your assets such as your house, land, motor vehicles, shares and bank accounts.
In your will you appoint an executor to distribute your assets to your beneficiaries (those you choose to receive your assets). Your choice of an executor should be carefully considered as the role can be very demanding and often complex, requiring legal and financial knowledge and guidance.
Any person of sound mind from the age of 18 years, or under 18 if married, can make a will.
What happens if I do not make a will:
Dying without a will (called ‘intestacy’) means your assets will be distributed according to rigid formulae set down by the laws of intestacy. Those laws may force the sale of your family home so that the debts can be satisfied and your estate is distributed to beneficiaries which you may not have considered.
Preparing your will:
A will is a complex legal document which should be prepared by a solicitor. You should consider
who to appoint as executor/s and their powers
who to appoint as guardian of your children and how you would like to provide for your children’s future
what your current assets and liabilities are
who should receive your assets
your life insurance
your preferred funeral arrangement
Can I prepare my own will?
You can prepare your own will but you do so at the risk of causing costly and emotional legal battles among relatives, should a dispute arise after you die. When preparing a will, a number of legal requirements must be followed or else it may be deemed invalid. If this occurs, and you have no valid earlier will, you may be presumed to have died intestate, with the laws of intestacy to apply, unless the invalidity is rectified by court process, which is expensive.
If your will is considered valid but your words fail to express your wishes accurately, the court may need to interpret your will, which may add further costs and emotional burden to your loved ones.
Changes to your will?
Your circumstances may change significantly over time so it is advisable to regularly review your will in the event of:
the birth of children or grandchildren
death of a beneficiary or executor
home or property changes
On marriage, your current will is automatically revoked unless it states it is made in contemplation of your marriage. Any Will you have in favour of a divorced spouse is immediately revoked as soon as the divorce is finalised.
Can I appoint someone else to act on my behalf?
You can legally appoint a trusted family member, friend or relative, to act on your behalf to handle your affairs. This person is known as your attorney and is allowed to handle your affairs, or have the power to act on your behalf, if you
take an extended holiday
suffer poor health
reach an age when you need greater assistance
A Power of Attorney is just as important as a will. While a will operates on your death, a power of attorney operated during your life.
Your appointed attorney must be over 18 years of age, someone you trust, able to understand what the appointment means and capable of looking after your affairs. In addition, an appointed attorney cannot be your health care provider (ie. your doctor), bankrupt, a paid carer and acting in anyone’s interest but yours (defined as a ‘conflict transaction’).
Types of powers of attorney:
Enduring power of attorney
Under an enduring power of attorney (EPA), you may give your attorney the power to deal with all or any part of your financial, personal and health matters. An EPA for financial matters can come into effect either immediately when you lose capacity, or on a specific date or at a specific event. There are a number of other considerations regarding this decision. It is advisable to seek legal advice to ensure your choice is fully informed.
If your attorney under an EPA acts in conflict of their duties and your interests (eg in financial relationships), they would enter a ‘conflict transaction’ which they can only do if you authorise such a transaction. It is best to discuss with us.
Your EPA is automatically revoked:
on your death
when you marry, unless your new spouse is your existing attorney
when you divorce, if your attorney was your spouse
when you appoint a new attorney
if your attorney dies or loses decision-making capacity
if your attorney becomes unqualified, for example, bankrupt or a paid health care provider.
You can choose to revoke your EPA at any time providing you are capable of understanding what you are doing. We can advise you on the procedures to follow.
General power of attorney:
A general power of attorney is often used in a business context by a corporation or an individual. It can authorise your attorney to deal with your financial affairs and comes into effect on the date you elect (ie it is not dependent on you losing the capacity to make decisions). It may limit the extent to which your attorney may deal with your affairs. A general power of attorney is normally used for the purchase and sale of land (e.g while you are overseas).