When you appoint an Enduring Power of Attorney or an Enduring Guardian, you are trusting that person to do the right thing by you and your affairs when you no longer have the mental capacity to do such things yourself. But if that person does not work in your best interests, or does something that concerns your loved ones, there might be a need to contest a Power of Attorney or Enduring Guardianship.
Powers of Attorney and Enduring Guardian bestow significant powers over your affairs
Making an Enduring Power of Attorney or an Enduring Guardian gives another person or people quite significant powers over your personal and financial affairs should you lose capacity.
They can make decisions which you may not have made yourself, had you still had the ability to do so.
Despite this, these appointments are not supervised, nor are they required to report to any authority.
What happens when poor decisions are being made by the attorney or guardian?
Because of the lack of supervision of appointments of Power of Attorney and Enduring Guardian, if poor decisions are being made, or there are questions around the appointment, it is generally left to the person's loved ones to challenge the appointment.
There are two main ways that an Enduring Power of Attorney or Enduring Guardian appointment can be challenged or reviewed.
These are by making an application to the NSW Civil and Administrative Tribunal (NCAT), which is by far the most common route taken by people, or by making an application in the Supreme Court of NSW.
How to contest a Power of Attorney or Enduring Guardian through NCAT
If you, or your loved ones, are concerned that your attorney or guardian is not making decisions in your best interests, an application can be made to NCAT to review the appointment and to make orders.
NCAT may also do this if there are questions around your mental capacity when you made the appointment.
NCAT can revoke, suspend, confirm or vary the appointment. However, to do so it will need to be satisfied that such action is in the best interests of the principal.
The benefit of going to NCAT is that the process is generally relatively straightforward and people do not generally require the assistance of a lawyer to make the application. This also keeps costs to a minimum.
Despite this, it can be useful to seek legal assistance if you need help with the application or are concerned about the process.
Case study - pressure to make decisions not in the best interests of the principal
An example of this is a current matter we are handling for a client, who has severe dementia and is in a nursing home. Her husband is her Power of Attorney. Both were married previously and each one has children from a previous marriage.
The husband's children want him to sell the house owned by him and his wife on the Gold Coast and move to Sydney, where he can buy a new house - in his and his children's names.
The mother's children are fighting this, as if the husband proceeds with the sale and buying elsewhere, he is not acting in the best interests of the principal - the mother.
Contesting an Enduring Power of Attorney through the Supreme Court
The other option is to apply to the Supreme Court of NSW. However, as this is significantly more complex and expensive than applying to NCAT, it is very rare for people to contest appointments through the Supreme Court.
Making an application to the Supreme Court of NSW will practically always require the assistance of a solicitor, and often a barrister, which greatly increases the costs involved.
David Crossan
Anneka Frayne
Powers of attorney and estate planning
Stacks Law Firm
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
