A Will comes into effect when you die. But what happens if you lose your mental capacity while you are alive? Both an Enduring Power of Attorney and Enduring Guardianship deal with your personal matters in this case. Importantly, these documents help to protect a person in different ways. So what is the difference between an Enduring Power of Attorney vs Guardianship?

In this article, we explain the key distinctions between an Enduring Power of Attorney and Enduring Guardian so that you can make an informed decision on who to appoint. Read on to learn the key responsibilities and duties of each role.

What is an Enduring Power of Attorney?

An Enduring Power of Attorney protects a person’s real and personal assets during their life, even if they lose capacity. In this document you are able to nominate someone you trust to make financial decisions on your behalf. Under the Powers of Attorney Regulation 2016, these can include operating bank accounts, paying bills, buying or selling property, managing investments or collecting rent.

In the instance that the person you have nominated is unable or unwilling to act as your attorney you have the ability, when creating the document, to nominate substitute attorneys to act for you. They are only able to do so if your first choice for an attorney cannot.

What is an Enduring Guardianship?

An Enduring Guardianship is a document that allows you to legally nominate people to make medical decisions on your behalf in the instance that you cannot do so yourself. Under the Enduring Guardianship Regulation 2016, this may mean making decisions regarding what health, dental or medical treatment you receive or if you can enter into assisted living facilities.

However, it does not give your nominated person the right to make any changes to a health care directive or your Will, should you have either of those documents. Much like an Enduring Power of Attorney, you are able to nominate people to act in substitution to an initial guardian should they be unwilling or unable to act on your behalf.

The difference between An Enduring Power Of Attorney vs Guardianship

Although an Enduring Guardian and Enduring Power of Attorney may appear similar on the surface, there is a key difference between these appointments – an Enduring Power of Attorney has the authority to make decisions over financial and legal affairs but not healthcare nor lifestyle matters. In contrast, an Enduring Guardian may govern healthcare and lifestyle decisions but not those relating to finances nor legal affairs.

However, these appointments are alike in that they both permit a particular person(s) to act on your behalf. The appointed person(s) may only lead decisions if and once you lose capacity to do this yourself. Typically, both legal documents will be included within your estate plan, often as part of your Will.

When it comes to deciding between appointing Enduring Guardianship or Power Of Attorney, the best course of action depends on your circumstances and needs. This is because each legal document permits different types of decisions to be made. Usually, it is recommended that you have both.

Do I need to appoint an Enduring Power Of Attorney and an Enduring Guardian?

Within New South Wales, an Enduring Power of Attorney and an Enduring Guardianship are different documents, and having one of these documents does not permit your nominated person to act outside the scope of the prescribed document. If you wish for someone to be able to manage both your finances and your health in the instance that you are unable to, both documents are required to be made and correctly executed.

However, in the Australian Capital Territory these documents are combined into one and it is up to the person who the document is relating to to decide the scope of power given to their nominated people, if they wish to give their nominated people the power of both financial and medical decisions, or just one.

In any instance, the people who you nominate to have power of your decisions once you lose capacity must agree to take on this role, and do so by signing the relevant document. It is important that your attorney or guardian understand your wishes so that they can act in your best interests, as well as understand what the role entails and gain independent legal advice if they so wish.

It is important to note, that at any time until you are deemed to have lost capacity, you are able to revoke either an Enduring Power of Attorney or an Enduring Guardianship. This allows you to redefine the scope of what you want your nominated people to do, or to choose new attorneys or guardians if you so wish.

Get legal support with appointing an Enduring Power of Attorney and/or Enduring Guardianship

BDN have experienced lawyers who can provide you with advice and draft an Enduring Power of Attorney and/or an appointment of Enduring Guardian to suit your needs.

Contact us today on (02) 6189 2569 (Canberra) or 02) 6190 1786 (Queanbeyan) for trusted legal services and support with your estate plan in the ACT and NSW.