Covisory Trust Services provides trust advice and independent trustee services. Although not strictly trust services we have found ourselves working with Wills and Enduring Power of Attorney, either as part of a wider succession planning exercise or in stand-alone engagements. We have found that many treat Wills and EPAs as after thoughts.   Clearly this should not be the case they are key documents for any estate and succession plan.

Wills

Deciding what age, you should write a Will is a personal decision. We would recommend not leaving putting a Will in place too long, accidents and unexpected events can and do happen. If you die without having made a valid Will then you will be Intestate and the provisions of the Administration Act 1969 will then apply. This act is very prescriptive on who can benefit from the deceased’s estate.

For many of our client’s trust structures hold the majority of their assets. These trusts effectively manage the transfer of assets to the next generation. Yet, many still have assets owned in their personal name. A Will is the best way to transfer those assets to other parties.

Haven’t we all seen the scenario of a Will once complete, often languishing in a drawer or filing cabinet, not seen again until the person dies and it is probated. We recommend to clients that a Will should be reviewed regularly every two years. Life does not stand still and this enables people to consider changing circumstances, including change of relationships, children being born and so on.  We have seen Wills where a divorced spouse is still the major beneficiary under the Will!

No two Wills are the same as everyone has specific circumstances. Although most Wills are based on templates, the clear majority of the Wills we produce for clients need specific drafting after meetings. There are several areas that need to be considered from appointment of executors to the distribution of personal property thru to the divestment of powers to appoint and remove trustees under trusts. It is important to get the document and then the clauses right.

Enduring Powers of Attorney (“EPA”)

Life can hold many unexpected events. You never know when the ability to make your own decisions could be taken from you. EPA’s are legal documents that protect you and what is precious to you. There are two types of EPAs:

  1. Property – which allows your attorney or attorneys to make decisions in respect of your personal property. This EPA can be in force at any time, regardless of mental capacity.
  2. Personal Care and Welfare – which relates to medical and care provisions if you are mentally incapacitated.

The sole biggest decision for the donor (the person appointing the attorney) is who will be the attorney. Clients often agonise and overthink the issue. For an EPA for personal care and welfare, only one attorney can be appointed at any one time. This is often a close family member like a husband or wife. For an EPA for property, multiple attorneys can be appointed to act together.

Regardless of who is appointed the donor must be comfortable with their choice. Also, the attorney must be happy to accept the role and responsibility as well.

Earlier this year changes were made to the Protection of Personal Property Rights Act 1988. This Act governs EPAs for both property and personal care and welfare. The changes were made due to the perception that the previous regime was being abused.  Unfortunately, we have seen examples where older people were being forced into signing documents they didn’t understand. Resulting in giving away their rights especially in relation to personal property.

The new regime also has seen the release of new EPA forms. These forms have a tick box approach. In theory, the new format should allow someone to simply complete them before taking independent advice and executing the documents.  To ensure there is no undue influence on the donor an independent person needs to meet the donor. Their role is to explain the terms of the EPA and ensure that the donor is not being influenced during the process.

Despite good intentions, the forms are not working as they should. They are very rigid and have a lot of language in them that make them difficult to understand from a layman’s perspective. From our experience, the new documents have overwhelmed clients. Many have struggled with the layout of the form. This is not the result the government was after!

If you would like to some assistance, the Covisory Trust Services team can help you through this process of putting these important documents in place. If you have any questions or would like to discuss further please contact Marcus Diprose.