Capacity and Agency

During the later stages of life, a loss of the ability or capacity to make decisions regarding one’s own health, property and finances may be inevitable. An enduring power of attorney and appointment of enduring document is an effective legal tool to allow another person to make financial or health decisions on your behalf. 

However, there are important differences between the operation of the two documents. An enduring guardianship authorises the guardian to make lifestyle or medical decisions on behalf of the appointor only when he or she has lost the capacity to make these decisions for himself or herself. An enduring power of attorney can operate irrespective of the principal’s mental capacity and continues to operate after a loss of capacity. 

There is no strict requirement for an attorney to consult with his or her principal prior to the exercise of their powers under the power of attorney. However, the attorney owes strict legal obligations to his or her principal to act honestly and in the principal’s best interests. 

So how does one determine whether there has been a loss of capacity and when they can begin acting under the authority of an enduring guardianship? In most situations it is useful to arrange for an assessment by a doctor. A general practitioner can assess mental capacity through a cognitive test and prepare a letter advising of their opinion on the cognitive capacity of the patient to make decisions for themselves. However, a person’s capacity to manage their affairs may vary significantly over time and can make such an assessment difficult.

Please contact our office should you require further information in relation the issues raised.


DISCLAIMER: The information contained in this article is general and is not intended to be advice on any matter. It is for information only and is not legal advice. In the event of a legal problem, you should seek legal advice.

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