- A general power of attorney (GPOA) allows someone you trust to handle your legal and financial matters on your behalf for a limited time.
- It does not cover health or lifestyle decisions and automatically ends if you lose decision-making capacity.
- The appointed attorney can perform tasks such as managing bank accounts, paying bills, handling investments, or signing contracts.
- Choosing a trustworthy and responsible attorney is critical, as misuse of power can lead to serious financial and legal consequences.
- A GPOA is best suited for temporary situations, such as travel, illness recovery, or business absence.
- Setting one up involves completing a legal form, signing it before an authorised witness, and sharing copies with relevant institutions.
- You can revoke a general power of attorney anytime while you have mental capacity by providing written notice to your attorney and affected organisations.
At some point, you may need someone you trust to make decisions or carry out tasks on your behalf. Whether you are travelling, busy with business, or temporarily unable to handle your personal matters, a general power of attorney can provide peace of mind. This legal document authorises another person, known as your attorney or agent, to act in your place for certain financial and legal decisions.
Before setting one up, it’s important to understand exactly what a general power of attorney involves, the types of powers it grants, and the responsibilities attached. This guide breaks it down in plain terms to help you decide if it’s the right choice for you.
What Is a General Power of Attorney?
A general power of attorney gives someone authority to deal with your legal and financial affairs for a specific period of time. Unlike an enduring or medical power of attorney, it does not cover health or lifestyle decisions, and it will automatically stop if you lose the ability to make decisions yourself.
People often use this arrangement when they need short-term support. For example, you may be overseas for work, undergoing surgery, or tied up with commitments that prevent you from managing your affairs. Once signed, the document takes effect immediately and remains valid until you cancel it or until you lose capacity.
It’s worth noting that this type of authority is not designed for long-term situations. If you want someone to continue acting on your behalf if you become incapacitated, an enduring power of attorney is usually more appropriate.
What Rights Does a General Power of Attorney Provide?
Granting a general power of attorney means giving another person significant authority over your financial and legal matters. While you can limit the scope of their powers, in most cases, they can make almost any decision you could legally make yourself.
Typical powers may include:
- Accessing and operating bank accounts.
- Paying rent, mortgage repayments, and other bills.
- Managing shares, bonds, or other investments.
- Buying, selling, or leasing property.
- Entering contracts or handling day-to-day business transactions.
Because these rights are extensive, choosing the right person is crucial. The role requires honesty and reliability. If misused, these powers could cause serious financial damage, so many people include restrictions within the document to narrow the attorney’s authority.
General Power of Attorney: Roles and Responsibilities
Two main parties are involved:
- The principal – the person granting authority.
- The attorney – the person appointed to act on the principal’s behalf.
Each has distinct responsibilities to ensure the arrangement works properly.
As the principal, you must:
- Clearly outline what powers are granted.
- Select a trustworthy attorney who understands the role.
- Review and, if necessary, revoke the document if circumstances change.
As the attorney, your responsibilities include:
- Acting in the principal’s best interests at all times.
- Keeping accurate records of all transactions made on their behalf.
- Respecting any limits or conditions set out in the document.
- Avoiding conflicts of interest and never using the role for personal gain.
Failing to act responsibly can have serious legal consequences. Attorneys may face liability if they misuse funds or act outside their authority.
When Is a General Power of Attorney Useful?
A general power of attorney is most helpful in temporary situations. Many Australians choose to create one if they expect to be absent or unable to handle their own financial matters for a period of time.
Examples include:
- Assigning someone to pay bills and manage property while travelling overseas.
- Allowing a trusted business partner to sign documents and make decisions in your absence.
- Giving authority to a family member to handle finances while you recover from illness or surgery.
It’s important to remember that the arrangement becomes invalid if you lose capacity. If you’re concerned about future incapacity, consider preparing an enduring power of attorney or a medical power of attorney alongside your general authority.
How Do You Set Up or Revoke a General Power of Attorney?
Establishing a general power of attorney in Australia is relatively straightforward, but the process varies slightly depending on your state or territory.
To create one, you usually need to:
- Obtain the official form from the relevant legal authority in your jurisdiction.
- Complete the document, setting out the scope of authority and naming your attorney.
- Sign it in the presence of an authorised witness, such as a solicitor or Justice of the Peace.
- Provide copies to your attorney and any organisations that may need to recognise it, like your bank.
Revoking the authority is equally important.
- You can cancel it at any time while you have decision-making capacity.
- Prepare a written notice of revocation and provide it to your attorney.
- Notify financial institutions, businesses, and others who rely on the document.
This flexibility ensures you retain ultimate control, allowing you to adjust the arrangement as your circumstances change.
Final Thoughts
A general power of attorney is a practical legal tool for those times when you need someone to manage your affairs temporarily. It allows you to focus on your health, travel, or business, while ensuring important financial matters continue to be handled.
However, the powers granted are extensive, and the choice of attorney should not be taken lightly. Always select someone you trust completely, and consider seeking legal advice to tailor the document to your needs.
By understanding the rights, roles, and responsibilities involved, you can put the right protections in place and feel confident that your interests will be looked after.