Legal Issues
Trusts
People establish Trusts for a variety of reasons, but with older people the more common reasons are to:
In any event people should consult their solicitor to establish a Trust. One of the commonly asked questions, is how to protect assets in case a person is likely to face residential care, and be required to pay fees privately until the reach the asset level for Residential Subsidy. The rules around gifting and residential care subsidies are complex and require advice from someone with experience in dealing with those rules.
A Trust can be thought of as a separate legal entity, in the same way as an individual person or a company. Some Trusts are set up by way of stipulating the establishment of a Trust in a Will. In these cases the Trust does not come into being until the person dies and the estate is wound up. In all Trusts there needs to be a trustee who has responsibility for the Trust property. This will normally include such things as land, stocks and shares, etc. The beneficiary or beneficiaries need to be stipulated in the Trust Deed and the Trustee has the duty of ensuring that the beneficiaries benefit in the way prescribed in the Trust.
Charitable Trusts are created for a variety of reasons, to establish scholarships, to benefit individuals in special circumstances, to further the work of social agencies, etc.
Power of Attorney
(Not to be confused with EPA)
When someone wants someone else to look after their finances while they are overseas or for other reasons.
Enduring Power of Attorney
An Enduring Power of Attorney (or EPA) is an authority given to a person to look after another person's affairs after the person has lost the capacity to make decisions themselves.
If someone has a serious stroke, develops dementia or has some other illness or injury which prevents them from making decisions the EPA can take effect.
There are two sections to the Enduring Power of Attorney: the first deals with a person's property (e.g. money, investments, land and buildings, etc.) and the second covers personal care and welfare. In the first type a person can choose when the EPA can come into effect, e.g. before they become incapacitated, afterwards or both. (Note: this type of EPA can be invested in more than one person). With the second type (i.e.for personal care and welfare), the EPA only takes effect after the person becomes incapacitated. Only one person can have this type of EPA.
Making The Right Choice
People are at liberty to choose whoever they wish to be their Enduring Power of Attorney (or EPA), obviously then need to trust that person or persons implicitly and be satisfied that the decisions made would be in their best interests. In relation to the first type (property) the EPA could be given to a family members, friend, lawyer, trustee company etc. A combination of function is possible, but those concerned should have full knowledge of a person's assets (especially bank accounts, property, investments, insurance and superannuation policies,
jewellery etc.).
The EPA for personal care and welfare can be held by a person who also holds the property EPA but in many cases a separate person is appointed. This EPA only comes into effect when the person giving it becomes "legally incapable" of making decisions.
If people do not have enduring power of attorney, and become incapable of making decisions, the process of then appointing EPA is very expensive and time consuming. Applications need to be made to the Family Court under the "Protection of Personal and Property Rights Act (1988)"and if the court is satisfied that the criteria are met, can then appoint an Enduring Power of Attorney.
In cases where elderly people can not easily get into town, Trustee officers or Solicitors may arrange for EPA papers to be signed in the home. Signatures need to be witnessed by an independent person, and the attorney's signature must also be witnessed. The attorney must be at least 20 years old.
For lastest information on EPAs click here.
Living Wills
A "Living Will" is a statement of how people wish to be cared for while they are still alive. Living Wills have no legal basis in this country, but can guide family members, carers and staff of Homes or Hospitals.
This information kindly supplied by Harris Tate
People establish Trusts for a variety of reasons, but with older people the more common reasons are to:
- Enable inheritances to be passed onto family without risk of it being lost to partners or spouses of family
- Establish financial resources for family members, especially for those who cannot easily do so themselves, or for those with a disability
- To protect assets in the event of an older person requiring residential care
- Organise your personal financial affairs
- Provide a form of protection for various beneficiaries
- Protection of assets against creditors
- Establish a Trust for charitable purposes
In any event people should consult their solicitor to establish a Trust. One of the commonly asked questions, is how to protect assets in case a person is likely to face residential care, and be required to pay fees privately until the reach the asset level for Residential Subsidy. The rules around gifting and residential care subsidies are complex and require advice from someone with experience in dealing with those rules.
A Trust can be thought of as a separate legal entity, in the same way as an individual person or a company. Some Trusts are set up by way of stipulating the establishment of a Trust in a Will. In these cases the Trust does not come into being until the person dies and the estate is wound up. In all Trusts there needs to be a trustee who has responsibility for the Trust property. This will normally include such things as land, stocks and shares, etc. The beneficiary or beneficiaries need to be stipulated in the Trust Deed and the Trustee has the duty of ensuring that the beneficiaries benefit in the way prescribed in the Trust.
Charitable Trusts are created for a variety of reasons, to establish scholarships, to benefit individuals in special circumstances, to further the work of social agencies, etc.
Power of Attorney
(Not to be confused with EPA)
When someone wants someone else to look after their finances while they are overseas or for other reasons.
Enduring Power of Attorney
An Enduring Power of Attorney (or EPA) is an authority given to a person to look after another person's affairs after the person has lost the capacity to make decisions themselves.
If someone has a serious stroke, develops dementia or has some other illness or injury which prevents them from making decisions the EPA can take effect.
There are two sections to the Enduring Power of Attorney: the first deals with a person's property (e.g. money, investments, land and buildings, etc.) and the second covers personal care and welfare. In the first type a person can choose when the EPA can come into effect, e.g. before they become incapacitated, afterwards or both. (Note: this type of EPA can be invested in more than one person). With the second type (i.e.for personal care and welfare), the EPA only takes effect after the person becomes incapacitated. Only one person can have this type of EPA.
Making The Right Choice
People are at liberty to choose whoever they wish to be their Enduring Power of Attorney (or EPA), obviously then need to trust that person or persons implicitly and be satisfied that the decisions made would be in their best interests. In relation to the first type (property) the EPA could be given to a family members, friend, lawyer, trustee company etc. A combination of function is possible, but those concerned should have full knowledge of a person's assets (especially bank accounts, property, investments, insurance and superannuation policies,
jewellery etc.).
The EPA for personal care and welfare can be held by a person who also holds the property EPA but in many cases a separate person is appointed. This EPA only comes into effect when the person giving it becomes "legally incapable" of making decisions.
If people do not have enduring power of attorney, and become incapable of making decisions, the process of then appointing EPA is very expensive and time consuming. Applications need to be made to the Family Court under the "Protection of Personal and Property Rights Act (1988)"and if the court is satisfied that the criteria are met, can then appoint an Enduring Power of Attorney.
In cases where elderly people can not easily get into town, Trustee officers or Solicitors may arrange for EPA papers to be signed in the home. Signatures need to be witnessed by an independent person, and the attorney's signature must also be witnessed. The attorney must be at least 20 years old.
For lastest information on EPAs click here.
Living Wills
A "Living Will" is a statement of how people wish to be cared for while they are still alive. Living Wills have no legal basis in this country, but can guide family members, carers and staff of Homes or Hospitals.
This information kindly supplied by Harris Tate
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