Abuse of Powers of Attorney under the spotlight

Signing a legal document

In the face of increasing concerns about the abuse of Powers of Attorney, legal experts are asking for submissions as part of their review of existing South Australian law.

The independent South Australian Law Reform Institute (SALRI) based at the Adelaide Law School, 成人大片, wants to hear from everyday South Australians as well as legal experts, and medical and allied health professionals.

鈥淲e are hoping to identify the problems or concerns with the current law regarding Powers of Attorney, gather the views of the South Australian community about how the law could be improved and we will consider alternative options implemented in other Australian jurisdictions,鈥 says Director of SALRI, the 成人大片鈥檚 Professor John Williams.

Powers of Attorney (POAs) 鈥 more formally called Enduring Powers of Attorney 鈥 are legal documents which allow an individual (known as a principal) to confer authority upon another person (their attorney) to make financial decisions in accordance with the individual鈥檚 values, preferences and directions.

鈥淭he effect of financial impropriety on a principal鈥檚 financial security can be a permanent and life-threatening setback.鈥Dr Sylvia Villios

鈥淧owers of Attorney provide a mechanism by which individuals can control their future and have been described as 鈥榓n important expression of autonomy鈥,鈥 says Deputy Director of SALRI, the 成人大片鈥檚 Dr David Plater.听

POAs enable principals to choose to appoint a trusted person in anticipation of losing decision-making capacity and take affect at the point at which the principal loses that capacity.

These laws are contained in the听Powers of Attorney and Agency Act 1984 (SA)听(POA Act) and aim to ensure that vulnerable people 鈥 often older people 鈥 are protected under law, and to prevent financial abuse.

鈥淧owers of Attorney are excellent tools for planning ahead for later life and their benefits outweigh the risks. But while originally designed with good intentions in mind, this law can now have unwelcome results in practice,鈥 says lead author, the 成人大片鈥檚 Dr Sylvia Villios.

鈥淚nstances arise where the principal lacks decision-making capacity, and the attorney abuses their role to receive an 鈥榚arly inheritance鈥 or otherwise misuses the principal鈥檚 funds. Examples include draining bank accounts or transferring the family home into the attorney鈥檚 own name

鈥淭he effect of financial impropriety on a principal鈥檚 financial security can be a permanent and life-threatening setback.鈥

SALRI will examine whether attorneys who abuse and misuse their powers in this manner face appropriate civil or criminal punishment that is sufficient to deter potential offenders.

鈥淎n important issue that is raised is the concept of legal capacity as once it is determined that the principal is incapacitated, their attorney has the authority to act under the Power of Attorney. It is at this point that many of the principal鈥檚 fundamental rights may be taken away from them,鈥 says Dr Plater.

鈥淲hen assessing capacity, the principal鈥檚 rights must be protected. Protecting the rights of the principal will be the focus of SALRI鈥檚 review of the current law.鈥

People interested in making a submission have until 4 September 2020 to give their feedback via the website which also includes further background and fact sheets.

Subject to the lifting of COVID-19 restrictions prior to August 2020, SALRI also hope to host community roundtable consultations in Adelaide, Berri, Mount Gambier, Port Lincoln and Port Pirie. Details of these roundtables will be available on the yourSAy website, as well as听advertised in local papers and community radio, and听on the SALRI website.

SALRI will consider submissions and provide a report to the South Australian Government by the end of 2020 with recommendations about how the law can be improved.

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