Understanding Powers of Attorney and Enduring Guardianship

Planning ahead for a time when you may not be able to make decisions for yourself is an important part of any estate plan. An Enduring Power of Attorney and Appointment of Enduring Guardian allows you to appoint someone you trust to make decisions on your behalf if you lose capacity.

What is an Enduring Power of Attorney?

An Enduring Power of Attorney allows you to appoint someone to manage your affairs in the event you lose decision-making capacity. The document can come into effect either before or after you have lost decision-making capacity and ceases to have effect after you pass away.

In the ACT, Enduring Powers of Attorney are regulated by the Powers of Attorney Act 2006, which allows you to authorise your attorney to make decisions in relation to financial, health care, personal care and medical research matters.

In NSW, Enduring Powers of Attorney fall under the Powers of Attorney Act 2003. An Enduring Power of Attorney in NSW allows you to appoint an attorney in relation to financial and legal matters only.

What is an Appointment of Enduring Guardian?

An Appointment of Enduring Guardian is made under the Guardianship Act 1987 in NSW and allows you to nominate someone to make health and personal care decisions on your behalf if you become incapacitated. This is a separate document in NSW, but the function is incorporated within an Enduring Power of Attorney in the ACT.

Why are these documents important?

Without an Attorney or Enduring Guardian, your loved ones may need to apply to a tribunal (such as NCAT or ACAT) for authority to make decisions on your behalf if you lose capacity. This can be time-consuming, costly and emotionally draining. If no suitable person is identified, the tribunal may appoint the Public Trustee and Guardian.

Completing an Enduring Power of Attorney, and Appointment of Enduring Guardian where necessary, allows you to control who will act on your behalf if you lose capacity and can give you and your family peace of mind for the future. 

Things to consider

Before completing an Enduring Power of Attorney and Appointment of Enduring Guardian, it is important to consider the following:

1. Appointing someone you trust – Choose someone who will act in your best interests and with whom you feel comfortable discussing your values, preferences and future wishes.  

2. Naming a substitute decision-maker – Consider appointing an alternative Attorney or Enduring Guardian who can step in if your primary decision-maker is unwilling or unable to act, or has passed away.

3. Setting conditions and directions – You may wish to limit the powers of your Attorney or Enduring Guardian or include directions about how decisions should be made.

4. Determining when the documents take effect – Decide whether you want your Attorney to begin assisting you immediately, if, for example, you are going overseas, or only once you lose decision-making capacity.  

If you would like to prepare an Enduring Power of Attorney or Appointment of Enduring Guardian, contact Robinson + McGuinness to arrange an appointment on (02) 6225 7040, by email on info@rmfamilylaw.com.au or get started now online with one of our experienced lawyers. We offer fixed fees for most estate planning services.

When should I update my will?

A will should be regularly reviewed and updated to ensure it reflects your current circumstances. Outdated wills can create confusion, result in unintended outcomes, and in some cases, lead to conflict between family members. It is recommended to update your will in the following circumstances:  

1. Marriage – A will is automatically revoked upon marriage, unless the will was made in contemplation of marriage. After your marriage, it is important to prepare a new will to ensure your estate is still distributed in accordance with your wishes.

2. De facto relationships – De facto relationships may give rise to an expectation that you look after your partner in your will, depending on how long you have been together and the circumstances of your relationship. If you have been married before or have a blended family, you should make sure your wishes are clearly reflected in your will.

3. Separation – Separation alone does not invalidate your will; however, a divorce will revoke any gift to your former spouse or appointment as an executor, trustee or guardian. If you pass away while separated but not divorced, your former spouse may still inherit from your estate or be entitled to superannuation.

4. Starting a family – You may wish to update your estate plan to ensure your children are provided for and to appoint a guardian in the event you and your partner pass away. This can help make your intentions clear in the event of a dispute between families; however, the appointment of a guardian is not binding.

5. Disposal and acquisition of assets – If you make a specific gift of property in your will but sell the asset before you pass away, you should update your will to ensure this is reflected in your estate plan. You cannot gift assets that you do not own and an outdated will may cause confusion and conflict between your loved ones. It is also important to update your will if your financial circumstances change significantly. 

If you’re unsure whether it’s time for an update, speaking with an estate planning lawyer can help clarify your next steps. If you would like to update a Will or prepare a Will, contact Robinson + McGuinness to arrange an appointment on (02) 6225 7040, by email on info@rmfamilylaw.com.au or get started now online with one of our experienced lawyers. We offer fixed fees for simple* estate planning.

Before undertaking any work, we will discuss your instructions and confirm whether your Will is able to be prepared for a fixed fee.

Costs Orders in Estate Litigation – What happens once an Order has been made?

When a Court makes a costs Order, it typically means that one party (usually the unsuccessful party) must pay some or all of the legal costs of the other. However, in most situations, the Order for costs doesn’t set out the amount to be paid, or when it has to be paid.

This post explains what happens after a costs Order is made in estate litigation in NSW or the ACT, and how parties can move from the Court’s decision to actual payment or enforcement of legal costs.

What Does a Costs Order Mean?

A costs Order generally sets out who must pay legal costs, but not how much. Common forms of orders include:

• “Costs as agreed or assessed” – The parties should attempt to agree on an amount; if not, the costs must be formally assessed.

• “Costs on the indemnity basis” – Requires the paying party to cover nearly all legal costs of the other, including some that might not be strictly necessary.

• “Costs in the cause” or “Costs reserved” – These orders defer responsibility until a later stage or depend on the case’s outcome.

Both in NSW and the ACT, the actual amount payable must be worked out through negotiation or, failing that, costs assessment (NSW) or taxation of costs (ACT).

First Step: Try to Reach an Agreement

Before entering formal processes, the parties usually try to negotiate a cost figure. This often involves:

• Exchanging invoices or itemised bills of costs;

• Informal discussions between legal representatives; and

• Offers to settle for a reduced or rounded amount.

If parties agree, payment can be made directly—there’s no need for court involvement or further paperwork or costs associated with any assessment, or delay.

There is no Agreement - Formal Assessment or Taxation of Costs

In NSW, if parties can’t agree on costs, the party entitled to payment can apply for a costs assessment under the Legal Profession Uniform Law (NSW) and associated rules.  Any application must be made within 12 months of a costs order being made.

This is an administrative, not judicial, process managed by the Supreme Court’s Costs Assessment Scheme. An independent Costs Assessor will review the bill and determine what is fair and reasonable.

In the ACT, the equivalent process is referred to as taxation of costs, as outlined in the Court Procedures Rules 2006 (ACT).  An application for taxation of costs must be made within 3 months of a costs order being made.

In the ACT, costs are assessed (or “taxed”) by a Registrar of the Supreme Court, who examines the bill, hears objections, and determines what is payable.

In both jurisdictions:

• The process begins with a bill of costs served on the other party.

• That party may respond with objections, and

• The assessor (NSW) or registrar (ACT) decides.

What Happens After Costs Are Assessed or Taxed?

Once the amount is determined, the matter can go one of two ways.

In the event payment is made, the matter finalises. The paying party should pay the amount promptly, as interest may accrue on unpaid costs from the date of the original court order.

In the event that no payment is made, the party owed costs may commence enforcement action. The following is important to keep in mind:

In NSW, the party who is owed costs:

1. Must register the certificate of determination as a judgment of the Supreme Court under the Uniform Civil Procedure Rules 2005 (NSW); and

2. Thereafter, it can be enforced like any other judgment through garnishee orders, writs, or bankruptcy/insolvency.

In the ACT, the party who is owed costs:

1. Must apply for a certificate of taxed costs; and

2. Thereafter, file the certificate in the Supreme Court and enforce it as a judgment debt under the Court Procedures Rules 2006 (ACT).

Important considerations

If you have been ordered to pay costs, you should act proactively and seek an itemised bill from the other party, if you haven’t already received one.  In the absence of a costs assessment/taxation, it is open to the parties to reach an agreement as to the amount that should be paid.  If an agreement can be reached, payment should be made promptly to avoid interest and enforcement costs.

If you are entitled to costs, you must serve a bill of costs promptly and keep detailed records of your fees and disbursements paid.  Don’t delay the filing of an enforcement application in the event you’ve not received payment.

A costs order is just the first step. Whether you’re paying or recovering legal costs, understanding the correct procedures in NSW or the ACT is essential to avoid unnecessary delay, expense, or enforcement proceedings.

If you’re unsure how to proceed—whether you need to assess, negotiate, or enforce—it’s important to seek legal advice to understand how to best proceed.  Contact Robinson + McGuinness to arrange an appointment on (02) 6225 7040, by email on info@rmfamilylaw.com.au or get started now online with one of our experienced lawyers.

Digital Assets in Estate Planning

Technology has become an integral part of our lives and it is important to consider how you wish for your digital assets to be dealt with when making an estate plan.

In absence of a digital estate plan, your loved ones may find it difficult to manage your information after you pass away. Online accounts may be overlooked and funds held financial accounts may not become available to your beneficiaries. This could give rise to litigation due to inaccessibility or disputes about how they should be administered. Leaving accounts open indefinitely can also increase the risk of identity theft. 

Digital assets include the following:

1. Online bank accounts, cryptocurrency and e-wallets (eg. PayPal, Apple Pay)

2. Intellectual property

3. Social media accounts (eg. email, Facebook, LinkedIn)

4. Subscriptions (eg. Netflix, Spotify, Audible)

5. Loyalty programs (eg. Everyday Rewards, Flybuys, Qantas Frequent Flyer)

6. Online shopping accounts (eg. Amazon, eBay)

7. Photos (eg. phone or iCloud)

How to make a digital estate plan

Creating a digital estate plan involves leaving a clear system for your executor to manage your digital assets after you pass away. You should prepare a list of all of your online accounts, including your usernames and passwords, and determine what you would like to be done with each account. The list should be stored in a secure place and updated when your account details change.

You may wish to consider a password storage tool to manage your account information, such as 1Password, Lastpass and Bitwarden. These are secure and effective tools for managing your passwords and provide your executor with easier access to your accounts. They also reduce the risk of security concerns if you were to write your passwords down on paper.

You will need to appoint a trusted person to act as your digital executor. This person will be responsible for managing your digital assets, distributing funds to beneficiaries and closing your accounts. A digital executor should be appointed as part of your Will, which deals with your real and personal property.

It is open to you to leave instructions about who you would like to receive your digital assets and how you would like your accounts to be dealt with. For example, you may wish for your social media accounts to be memorialised, or for someone to continue managing a particular account. You should ensure your instructions are consistent with the service agreements of each digital asset as some platforms place restrictions on how your accounts are managed after you die. For example, Qantas Frequent Flyer points are automatically cancelled on death and cannot be transferred.  

It is important to create a digital estate plan along with your Will and Power of Attorney, however your digital estate plan should be separate to your Will. Your Will becomes public after you die so including detailed information in your Will can raise security risks. Having a separate document for your digital estate plan also means you can continue to update your plan as necessary without having to formally re-execute your Will. 

We offer fixed fees to review your estate planning and can assist you with preparing your digital estate plan along with your Will and Power of Attorney. If you would like further information or wish to update your estate planning with us, please contact us today on (02) 6225 7040 or by email info@rmfamilylaw.com.au or get started now online.

Author: Amy Davis

What Happens to Your Superannuation When You Die?

Superannuation is considered separate to your estate, which means special arrangements need to be made if you want to decide where your super will be paid. 

You can nominate beneficiaries for your super by a completing a death benefit nomination, which can be binding or non-binding. Binding death benefit nominations are written directions to a superannuation trustee which set out how you wish for your super to be distributed. If you have a valid nomination at the time of your death, the trustee is bound to follow it. Non-binding death benefit nominations are a written guide as to how you would like your super to be distributed, however the nomination is not binding on the trustee, who has ultimate discretion as to how to distribute your super.

Completing a binding death benefit nomination gives you greater certainty as to how your super will be distributed in the event of your death. If you don’t have a valid nomination in place, the trustee will need to make a decision as to how your super will be distributed, which generally involves investigating your relationships at the time of your death. Each super fund is different, and the decision will need to be made in accordance with the rules of the fund, as well as superannuation law. This can be a lengthy process, so having a valid nomination in place can also reduce delay in making payment to beneficiaries.

Who can I leave my superannuation to?

The Superannuation Industry (Supervision) Act (“SIS Act”) provides that death benefit nominations can only be made to your legal personal representative or a dependant. Dependants include children, spouses and people you have an interdependency relationship with (e.g. close personal relationships where you live together and one or each of you provide the other with financial and domestic support). A number of factors are taken into account when determining whether an interdependency relationship exists.

Parents and siblings generally do not satisfy the requirements of the SIS Act, meaning if you want your parents or siblings to receive your super, you should nominate your legal personal representative as your beneficiary to ensure your super benefit is paid into your estate. The funds can then be distributed in accordance with the terms of your will. 

Death benefit nominations generally lapse after a period of three years, so you should make sure you review your nomination if necessary. Some super funds offer non-lapsing death benefit nominations which do not lapse until you update or cancel the nomination.

It is recommended to review your estate planning arrangements every few years to ensure they still reflect your wishes. You should also consider reviewing your estate planning if there has been a change in your personal circumstances or financial situation. We offer fixed fees to review your estate planning arrangements and can assist you with preparing Wills, Powers of Attorney, and binding death benefit nominations. If you would like to discuss your circumstances and how we can assist you, please contact us today on (02) 6225 7040 by email info@rmfamilylaw.com.au or get started now online.

Author: Amy Davis