We are all going to die and thus should have a current will reflective of current intentions. The last will is the document upon which your estate will be determined, the executor being obliged to follow its terms.
The person (or persons) who are able to make decisions for you prior to death is a power of attorney. You should choose this person based on trust but also having regard to who is best equipped to make difficult decisions for the different areas involved. In Victoria, powers of attorney exist for different areas of law -financial decisions, personal decisions and medical treatment decisions. There are also supportive powers. The donee or donees need not be the same person or persons for various roles.
What Is the Presumption of Capacity?
Legal Capacity is required to enter into legal transactions. “Capacity” requires the client to have the cognition required to understand the facts, evaluate the choices and their consequences, and make a decision based on a reasoned assessment.
Whilst there may be a basic legal presumption that every adult has the mental capacity to make legal decisions for themselves the presumption of mental capacity in adults can be rebutted if there is evidence that the adult does not have the necessary decision-making ability. Lawyers will generally ask a series of questions to assist them to identify any loss of or diminished capacity and where there is doubt, medical opinion may be sought.
How Do You Determine If Someone Has Capacity?
Determining mental capacity is not always easy noting that there is no singular test. Different forms of capacity are required to make different types of decisions. The ability for the client to remember reflect and reason forms an essential basis for making a will, and interview questions assist to identify that capacity. These notes are then recorded if capacity is later queried.
What Capacity is Required?
It is important to understand that capacity is not a diagnosis. Rather, if there is a question about the capacity of a person, then an assessment is made on a case-by-case basis as to whether the person has the capacity for each particular decision.
Some legal decisions require a higher level of capacity than others. For instance, it is broadly understood that a person requires more capacity to manage all of their financial affairs than to simply make a will. Conversely, a person who is deemed incapable of making a will may still have the capacity to revoke an existing will; and someone with the capacity to make a will may not be able to appoint an enduring power of attorney. These comparisons are based on the complexity of the information that the person must be able to understand and evaluate to make the decision that is right for them.
What Can I Do for My Loved One?
Solicitors often have requests from someone who wants to be appointed as the power of attorney for a loved one who is losing capacity or may even have lost capacity. Only the person who is the subject of the power can appoint the attorney, and they must do this while they still have the capacity to make that decision.
Appointing a power of attorney is considered a complex decision, at least relative to decisions such as making or revoking a will. This is because the decisions contained in a will cannot harm the will-maker but a power of attorney exposes that person to a risk of harm and exploitation.
If you have a loved one who has lost capacity to manage their own affairs, and they do not have arrangements in place to have someone make a decision for them, then an order from the VCAT will need to be sought, the Tribunal requiring certain evidentiary material to be provided and examined as part of that process.
This is general information only and every matter is different. If you or someone you know wants more information or needs help or advice, please contact us on 03 51761345 or email [email protected] to schedule an appointment.