When it comes to writing an Enduring Power of Attorney (EPA), you might come across some terms that you haven't heard before. Here are the explanations for some of the most common terms used in a Property EPA.
The Protection of Personal and Property Rights Act 1988. Part 9 of the Act sets out the law on EPAs.
Your attorney cannot benefit personally unless you state in your EPA that your attorney can act for their own benefit. If you wish other people to benefit (i.e. live in your property rent-free), you need to make this clear in your EPA.
You should be aware that being an attorney can be time-consuming and may have a financial impact on whoever you choose for this role. You should think about whether you want them to be compensated for taking on this responsibility.
Your attorney is responsible for looking after your needs. If there is a possibility that other people may have financial needs for which you would have otherwise provided for, i.e. paying for your child’s education, you should state these in your EPA. Your attorney will need your authority to pay for these costs. It is recommended that you clearly state how your attorney, or others, can benefit in your EPA.
If you appoint Perpetual Guardian as your attorney, fees will be determined on a case by case basis according to what is required and how much time is spent on them.
A person or persons appointed by the donor to act on behalf of the donor on some or all of the donor’s property affairs (property EPA). This includes a successor attorney whose appointment has taken effect (unless the context makes it clear that this is not intended).
A person who witnesses a donor’s signature to an EPA. The signature must be witnessed by one of the following:
o a lawyer
o a legal executive who is a member of, and holds a current annual registration certificate issued by, The New Zealand Institute of Legal Executives Incorporated, has 12 or more months’ experience as a legal executive, and is employed by and supervised by a lawyer
o an authorised officer or employee of a trustee corporation.
· If the attorney is a lawyer appointed in his or her capacity as a lawyer, the witness may belong to the same firm as the attorney. If the attorney is a trustee corporation, the witness may be an officer or employee of that corporation.
· In any other case, the witness must be independent of the attorney and any successor attorney named in the EPA.
Where this doesn’t apply
The requirement that the witness must be independent of the attorney is modified where two people appoint each other as attorney in order to allow:
|Capable of making a will||
The law requires that anyone making a Will must understand the nature and effect of what they are doing, who might have a claim to their estate, what they are disposing of, and how they are disposing of it. This is called having testamentary capacity.
To ask for advice and give that advice proper consideration before making a decision in the donor’s best interests. This includes making sure the person being asked for advice has all the information they need to base their advice on.
The person setting up the EPA giving the appointed attorney(s) authority to act for them.
An attorney’s appointment under the EPA ends when any of the following events occurs:
An Enduring Power of Attorney in relation to property made under Part 9 of the Act (unless the context makes it clear that another kind of enduring power of attorney is intended).
A certificate given by a relevant health practitioner on whether the donor is mentally incapable. The certificate must contain the information required by regulations under the Act.
Under the Act, donors are mentally incapable in relation to property if they are not wholly competent to manage their own property affairs. Everyone is presumed to be competent to manage their property affairs until the contrary is shown. Someone is not to be presumed to lack competence just because the person makes imprudent decisions, is subject to compulsory treatment or has special patient status under the Mental Health (Compulsory Assessment and Treatment) Act 1992.
Things that your attorney needs to pay for from their own resources in order to carry out their role, such as postage and stationery costs, bank fees, travel costs, telephone bills, and legal fees. These expenses do not include lost wages or payment for your attorney’s time.
A form set out in the Protection of Personal and Property Rights (Enduring Powers of Attorney Forms and Prescribed Information) Regulations 2008.
Anything the donor owns, leases, hires, or holds on hire purchase. Property includes any land or buildings, money, investments, goods, shares, stock, machinery, businesses, household effects.. It also includes items such as vehicles, boats, aircraft, and caravans, and any interest in any of above or right in respect of them.
|Relevant health practitioner||
A health practitioner in New Zealand who is authorised to make assessments of mental capacity. For example, a New Zealand general medical practitioner (GP). In relation to a medical certificate given overseas, a registered medical practitioner in the country where the certificate is issued who is authorised to make assessments of mental capacity.
To cancel (end the validity of) an EPA or an attorney’s appointment:
A person appointed by the donor to be their attorney if a previous attorney’s appointment ends.
The donor of an EPA who was, but is no longer, mentally incapable may suspend the attorney’s authority to act by giving written notice to the attorney. The EPA is not revoked by the suspension but the attorney cannot act again unless and until a relevant health practitioner has certified, or the court has determined, that the donor is (again) mentally incapable.
An EPA is terminated by any of the following events:
The New Zealand Guardian Trust Company Limited, Māori Trustee, Public Trust, and every trustee company within the meaning of the Trustee Companies Act 1967.