How Does The Power of Attorney Work?

June 13, 2024    Probate Lawyers Perth
How Does The Power of Attorney Work?

A Power of Attorney is a legal document that designates one or more individuals (referred to as the “Attorney”) to handle financial and legal matters in your absence. The “Principal” is the one who signs the Power of Attorney.

Getting legal advice from the best probate lawyers in Perth before choosing an attorney is crucial. A lawyer can evaluate your situation and provide you with advice regarding the powers to assign to an attorney and the consequences of doing so.

In this article, learn the different powers of attorney—financial and medical, how they work, how to create a power of attorney and more. So, let’s start.

Financial Powers of Attorney

Financial Powers of Attorney give the designated attorney the authority to handle the individual’s financial and legal matters, including:

  • Routine administrative duties such as approving paperwork and setting up stock and commercial transactions.
  • Buying and selling other assets, leasing, selling, and mortgaging real estate, and managing bank accounts

Attorneys are the terms typically used to describe the decision-makers designated under a financial power of attorney. By selecting someone as your Financial Power of Attorney, you are essentially appointing that individual to act on all your financial decisions on your behalf.

Medical Powers of Attorney

With the use of a medical power of attorney, an individual can designate a decision-maker to oversee their lifestyle and health-related matters, such as:

  • The kind of care they receive and the sort of housing they occupy.
  • The kind of assistance or personal care they get.

What Are The Attorney’s Duties?

Note: The principal is the person giving the power of attorney to the other person (attorney).

Attorneys are required by law to fulfil the following obligations:

  • Consider the wishes and preferences of the Principal and make decisions that the Principal would have made.
  • Handle the Principal’s business properly, operate in their best interest, and maintain documentation.
  • Don’t combine money and stay out of trouble
  • Be truthful and sincere in your actions.
  • Collaborate with additional decision-makers
  • Make choices that minimise the principal’s freedom restrictions.
  • Promote the principal’s involvement in community, life, and decision-making.
  • Keep the Principal safe from mistreatment, exploitation, or neglect.
  • Act in accordance with the commencement date, authority, and restrictions of their employment.

When To Make a Power of Attorney?

In the event that you have a temporary or permanent loss of capacity, it is a good idea to have a Power of Attorney in place. A disease, accident, or disability could cause this to occur at any time. A court or tribunal may choose someone to handle your finances if you do not have a Power of Attorney in place.

You can also designate an attorney to handle your bill payment and financial management for a variety of reasons, such as:

  • You’re travelling or residing overseas;
  • You suffer a temporary or permanent loss of capacity due to an illness, accident, or disability;
  • Or do you simply want someone else with financial management skills.

How To Create a Power of Attorney?

Given certain legal requirements, probate lawyers in Perth can provide vital guidance when creating a Power of Attorney (POA) in Australia.

First and foremost, the principal—the individual giving the POA—must be at least eighteen years old and mentally capable of making their own decisions. They have to be fully aware of the consequences of designating a POA and the degree of authority they are giving.

Since this person will have substantial authority over their affairs, the principal should select an attorney they implicitly trust. In addition, the lawyer must be an adult and competent to handle the obligations that come with the job. They shouldn’t be insolvent or, in the event of an Enduring POA, the principal’s paid caregiver or healthcare provider.

The principal and the attorney must have open lines of communication and a shared understanding of the responsibilities and constraints of the role. In accordance with legal requirements, the POA must be duly recorded in writing, duly signed, and, depending on its nature, duly witnessed.


In the context of Australian law, it is essential to understand the subtleties of a Power of Attorney. We’ve talked about the various kinds of POAs, how they work, how to draft them, and how crucial it is for the principal and the attorney to communicate clearly.

Professional legal counsel from expert probate lawyers in Perth is vital for anyone thinking about creating a POA. Your rights and interests will be adequately safeguarded and represented thanks to their skilful guidance through the process’ intricacies.

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