succession, attorney & guardianship law reforms

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Powers of Attorney, Guardianship

and Succession law reforms -

planning for 2015Daniel Kelliher

Anita Courtney

Michael Labiris

12 November 2014

Russell Kennedy Solicitors

Updates on:

• Powers of Attorney – Daniel Kelliher

• Guardianship – Anita Courtney

• Succession Law – Michael Labiris

Introduction

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1. Powers of Attorney Act 2014

New Legislation

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Title Purposes Commencement

Powers of

Attorney Act

2014

1. consolidate the existing laws relating to powers

of attorney

2. provide for the appointment of a “supportive

attorney”

3. repeal Parts XI and XIA of the Instruments

Act 1958

4. repeal Division 5A of Part 4 of the

Guardianship and Administration Act 1986

1 January 2015

Key areas of New Law:

• Improved General Power (GPA)

provisions and new form

• “Supportive Attorneys”

• Enduring Powers – extensive new regulation

• replacement of Part XIA, Instruments Act

• Improved VCAT jurisdiction

• incl Compensation Orders, offences and penalties

Powers of Attorney Act 2014

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Section 4 defines “decision making

capacity”

• Requires understanding, retention, reasoning and

communication abilities

• Use of “modified language, visual aids or any other

means” and “practicable and appropriate support”

are encouraged to prompt understanding

• Capacity may differ depending on the decision,

incapacity may be temporary, decisions can be

unwise but should not be seriously injurious to

health or wellbeing

Powers of Attorney Act 2014

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• Section 7 and Schedule Form

• Adds alternative attorneys

• Permits later commencement

• Silent as to revocation

• Far simpler and less regulated than EPAs

General Powers of Attorney

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• Prescribed Form required

• And not yet developed

• Attorney’s implementation (execution)

powers exclude “significant financial

transactions” (eg. Above $10,000)

• Will allow transitional supported decision-

making, where a donor is reluctant to cede

Power until they are incapable

• Less power, but lower risk for the Attorney

Supportive Attorneys

8

Key new matters EPAs:

• New prescribed form, not yet developed

• Combines EPAFs and EPG

• Enduring Powers Financial (2004-2015)

• Enduring Powers of Guardianship

• Section 3 definitions

• “personal matters”

• “financial matters”

Enduring Powers of Attorney

9

Key new matters EPAs (cont):

• s21 “principles” = new duties to the Donor

• s23 donor matters to understand


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• Eligibility section 28:

• Adult, not insolvent

• not a care worker, a health provider or an

accommodation provider for the principal

and

• for financial matters, either free of

dishonesty offences or they must be

recorded/acknowledged in the Power


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• s29, appointment by position/status

• s30, multiple appointments incl joint, joint

& several and now, “majority decisions”


12


• s31, alternative attorneys

(Very little change)

• Sections 37 & 38, stricter acceptance

• s39, commencement on cessation of

decision-making capacity; s40

notifications; S41 continuation if capacity

regained


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• Revocation much more formal

• Prescribed form with strict witnessing and

certification required

• New Power will be most efficient

• By resignation, death or disqualification

• s62, other multiple attorneys retain power


14


• Duties of Attorneys, s63

• Conflict transactions & permitted conflicts

• Disagreement

• Personal attorney prevails over solely

financial attorney (where distinctions apply)


15

VCAT & supervisory provisions

• Compensation by attorney to donor, s77

• Extended VCAT jurisdiction, Part 8

• Part 9 offences

• Penalties, section 135:

• Natural people, level 6 imprisonment (5

years maximum) or 600 penalty units or

both; Body corporate, 2400 penalty units.


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In Summary

• Greater Attorney responsibilities/risks

• More sophisticated regulation

• with occasional complexity


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2. Guardianship &

Administration Bill 2014

Bill not passed

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Title Purposes Status

Guardianship

and

Administration

Bill 2014

1. re-enact with amendments the law relating to

guardianship and administration

2. repeal the Guardianship and Administration

Act 1986

3. consequential amendments to various other

Acts

Not passed prior

to the election –

will need to be

reintroduced

>Guardianship and Administration Bill

2014

> Introduced 20 August 2014

> Not passed

> Will need to be re-introduced after

election

>Complements the Powers of Attorney

Act 2014

Guardianship &

Administration Reforms

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• Definition of capacity (clause 4)

• Use of “modified language, visual aids

or any other means” and “practicable

and appropriate support”

• May differ depending on the decision

• Incapacity may be temporary

• It should not be assumed that a person

does not have capacity for a matter on

the basis of their appearance

Key Aspects: Capacity

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• Three types of appointments

• Guardians for personal matters only OR

for personal and financial matters

• Administrators for financial mattes

• Definitions (and examples) of

‘personal’ and ‘financial’ decisions

• New concept: supportive guardians

Key Aspects: Appointments

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• Greater involvement by VCAT in early

stages

• Greater emphasis on appointing

persons with a relationship rather than

professional persons/organisations

• Relatives/carers can file a document

that sets out their wishes

Key Aspects: VCAT

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• Offence where a guardian,

administrator or supportive guardian

“dishonestly uses their appointment to

gain financial advantage or cause loss

to the represented person”

• Compensation orders

Key Aspects: Offences and

Compensation

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• LIV/Federation of Community Legal

Centres

• VCAT statements re wishes of family

members/representatives

• Could have the effect that the most

suitable person(s) not appointed.

• Criteria for appointment parental

guardianship and administration orders

• Limit it to “significantly impaired”.

Criticisms

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3. Justice Legislation

Amendment (Succession and

Surrogacy) Act 2014

New Legislation

27

Title Purposes Commencement

Justice

Legislation

Amendment

(Succession

and

Surrogacy) Act

2014

1. amend the Administration and Probate Act

1958 in relation to:

(i) family provision claims

(ii) rules for the payment of debts of an estate

(iii) administration of small estates

2. amend the court authorised wills scheme in the

Wills Act 1997

3. amend the Status of Children Act 1974 to

allow registration of a surrogate birth if a

parentage order is made by an interstate court

1 January 2015

• Regulates how property is

administered and distributed

on the owner’s death

• Estate vs non-estate assets

• Wills & intestacy schemes subject to

family provision law

What is Succession Law?

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• Roman origins of family provision law –

lex Falcidia

• English law generally permitted full

testamentary freedom (with minor

exceptions)

• New Zealand initiative of 1900

• Followed in Australia and UK

Historical background to

family provision law

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• 1958 to 1998 – only the widow, widower and

children of a deceased person could claim

• 1998 to 2014 – any person could claim if:

1. Testator had “responsibility to make

provision” for them

2. The will (or intestacy scheme) does not

make adequate provision for their

“proper maintenance and support”

Development of family

provision law in Victoria

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• VLRC Report Sep 2013

• Legislation introduced August 2014 –

excluded adult children who were not

disabled or dependent

• Amended legislation introduced and

passed in September 2014 – will now

apply to estate of any person who dies

from 1 January 2015

Recent law reform

31

• Application within 6 months of date of grant

• Court may make order if satisfied:

1. Plaintiff is an “eligible person”

2. In some cases, the “eligible person” must be “wholly

or partly dependent on the deceased for proper

maintenance and support”

3. Deceased had a moral duty to provide for the

plaintiff’s proper maintenance and support

4. Distribution of estate (by will or intestacy) fails to

make adequate provision for the proper maintenance

and support of the plaintiff

New Legislation

32

Eligible person:

Automatic right to apply

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• A spouse or domestic partner of the deceased at

the time of the deceased's death

• A former spouse or former domestic partner of the

deceased (in limited circumstances)

• Any child (including adopted child) of the deceased

• Any step-child of the deceased

• A person who, for a substantial period during the life

of the deceased, believed that the deceased was a

parent of the person and was treated by the

deceased as a natural child of the deceased

• A grandchild of the deceased

• A spouse or domestic partner of a child of the

deceased if the child of the deceased dies within

one year of the deceased's death

• A registered caring partner of the deceased

• A person who, at the time of the deceased's death,

is (or had been in the past and would have been

likely in the near future, had the deceased not died,

to again become) a member of the household of

which the deceased was also a member

Eligible person:

Must also be dependent

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• Court may not award amount that is greater than is necessary

for the eligible person's proper maintenance and support

• For eligible persons who must be dependent:

• Court must take into account degree of dependence

• Amount awarded must be proportionate to the eligible person's

degree of dependency on the deceased for the person's proper

maintenance and support at the time of the deceased's death

• For children over 25, or over 18 and not a full-time student,

who do not have a disability, the Court must take into account

the degree to which the child is not capable, by reasonable

means, of providing adequately for his or her own proper

maintenance and support

New limitations on claims

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QUESTIONS

The information contained in this

presentation is intended as general

commentary and should not be regarded as

legal advice. Should you require specific

advice on the topics or areas discussed

please contact the presenter directly.

Disclaimer

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Daniel Kelliher

Special Counsel

Tel: 9609 1662

[email protected]

Anita Courtney

Associate

Tel: 8602 7211

[email protected]

Michael Labiris

Lawyer

Tel: 8640 2304

[email protected]

mailto:[email protected]

