A Power of Attorney is an instrument signed by a person (known as the Donor) giving another person (known as the Attorney or Donee) power to act on behalf of the Donor in accordance with the terms of the instrument. A General Power of Attorney has no effect if the Donor becomes mentally incapable. In contrast, an Enduring Power of Attorney (EPA) arises under the Powers of Attorneys Act 1996. It is designed to provide for the appointment of an individual or a trust corporation as an attorney who can make certain decisions in the event of the Donor losing mental capacity. It has no force or effect while the Donor retains his/her mental capacity.
An EPA must comply strictly with the Powers of Attorneys Act 1996 and the Statutory Instrument. It is usually drafted by a solicitor. It will contain a statement by a medical practitioner that with the assistance of any explanations that the Donor has the required mental capacity to understand the effect of creating the Power of Attorney and that the Attorney accepts the EPA.
It will also contain two further statements:- (a) a statement by the Donorâ€™s solicitor that after interviewing the Donor and making any necessary enquiries he/she is satisfied that the Donor understands the effect of creating the EPA and that he/she has no reason to believe that the document is being executed by the Donor as a result of fraud or undue influence; and (b) a statement by the Donor that he/she has read certain information creating the EPA.
It is a question of degree, particularly where dementia is involved, as to whether a person has the requisite capacity. In one English case it was held that the test for capacity is whether the person understood that the Attorney would be able to assume control over their affairs. The Donor may give his/her Attorney a general authority to deal with property and affairs or may specify precisely those areas which the Donor would like the Attorney to handle. He/she may also allow an Attorney to make specified personal care decisions which can be quite extensive. It does not however allow authority to make decisions on medical treatment or surgery.
While the Donor can appoint an individual or a trust corporation as a Power of Attorney, he/she may not appoint the owner of a nursing home, a person aged under 18 years or someone convicted of fraud, dishonesty, disqualified under the Companies Acts or declared a bankrupt as his/her Attorney.
An EPA does not come in to effect until it is registered and this can only happen when and if the Donor becomes mentally incapacitated. As a result, many EPAs are never used.
When the EPA is executed the Donor must give notice to at least two people other than the Attorney named in the EPA. One of them must be the spouse, if he/she is living and not the Attorney, and if not then a child of the Donor will suffice, otherwise it must be a relative.
To register an EPA an application must be made to the Registrar of the Wards of Court by the Donor’s solicitor. The Attorney must produce evidence of the Donor’s declining capacity in the form of a certificate from a registered medical practitioner and the application must give notice to the two notice parties as well as the Donor.
The advantage of an EPA is that it allows the Donor to appoint whom he/she requires to look after his/her affairs in the event of him/her losing capacity. It is an alternative to the cumbersome Wardship system which is largely based on nineteenth century law. A note of caution however is that it is important that whomever the Donor appoints under the EPA as his/her Attorney must be financially sound and he/she must keep appropriate accounts. There is a growing concern among many people about the financial abuse of elderly people and the Law Reform Commission have brought out two excellent consultation papers and a report concerning the law and the elderly and vulnerable adults and the law. Their website is www.lawreform.ie.