A common misconception is that if you lose mental capacity your spouse, partner or children will automatically be able to make decisions for you in relation to your property and personal care and welfare matters. This is only correct if you have appointed them as your attorney in an enduring power of attorney document.
If you do not have enduring power of attorney documents in place before you lose mental capacity, then the only option your loved ones have is to make an application to the Family Court for someone to be appointed a property manager and/or welfare guardian so they can make decisions for you.
The Court will decide who the best person is to be your attorney. This is an expensive and time-consuming process particularly if there is a disagreement between your loved ones as to who the Court should appoint to be your attorney.
The second common misconception is that only older people need to put enduring powers of attorney in place. But any person of any age can lose mental capacity, through an accident or a stroke. We go to the trouble of putting a will in place to ensure that our assets are left in the right hands when we die, but many people do not consider who will manage their property and personal care and welfare if they lost mental capacity.
There are also different types of powers of attorney, one is the common ordinary power of attorney which can only be used by an attorney when you are absent from New Zealand or during periods of temporary physical incapacity. This power of attorney cannot be used if you lose mental capacity.
You need to think of enduring power of attorney documents like having insurance. If you need it but you don’t have it, it will be a problem for you and your loved ones.
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