Powers of Attorney Act 2003 (NSW)

Powers of Attorney Act 2003 No 53 An Act to consolidate and revise the legislation relating to powers of attorney; to make consequential amendments to the Conveyancing Act 1919 and certain other legislation; and for other purposes. Part 1 Preliminary 1 Name of Act This Act is the Powers of Attorney Act 2003. 2 Commencement This Act commences on a day or days to be appointed by proclamation. 3 Definitions (cf 1919 No 6, ss 7 (1) and 158 (1) and (2)) (1) In this Act— assurance includes a conveyance and a disposition made otherwise than by will. attorney, in relation to a power of attorney, means a person to whom the power is given. bankruptcy means any act or proceeding in law having effects or results similar to those of bankruptcy, and includes the winding up of a company under the Corporations Act 2001 of the Commonwealth. conveyance includes any assignment, appointment, lease, settlement or other assurance by deed of any property. dealing has the same meaning as it has in the Real Property Act 1900. deed, in relation to land under the provisions of the Real Property Act 1900, includes a dealing having the effect of a deed under that Act. disposition includes— (a) a conveyance, and (b) an acknowledgment under section 83 of the Probate and Administration Act 1898, and (c) a vesting instrument, declaration of trust, disclaimer, release and every other assurance of property by any instrument except a will, and (d) a release, devise, bequest or an appointment of property contained in a will. enduring power of attorney—see section 19 (1). exercise a function includes perform a duty. function includes a power, authority or duty. incommunicate—see section 4. instrument includes a deed. irrevocable power of attorney—see section 15. prescribed power of attorney—see section 8. principal, in relation to a power of attorney, means the person giving the power. property includes— (a) real and personal property, and (b) any estate or interest in any real or personal property, and (c) any debt, thing in action or other right or interest. registered means registered as referred to in section 51. review tribunal—see section 26. third party, in relation to a power of attorney, means a person other than the principal or an attorney on which a power is conferred by the power of attorney. vacancy in office of an attorney—see section 5. valuable consideration includes marriage but does not include a nominal consideration, even if it has some value. will includes codicil. Note. The Interpretation Act 1987 contains definitions and other provisions that affect the interpretation and application of this Act. (2) A power of attorney does not become a different power of attorney if an attorney appointed by the power is lawfully replaced by a different attorney, the exercise of a power conferred by it is lawfully delegated or a sub-attorney is lawfully appointed to exercise a power under it. (3) A reference in this Act to a suspended power of attorney is a reference to a power of attorney that is— (a) suspended or restricted in operation by reason of mental incapacity of the principal occurring after the execution of the instrument creating the power, or (b) suspended by operation of section 50. (4) Notes included in this Act do not form part of this Act. Note. For the purposes of comparison, a number of provisions of this Act contain bracketed notes in headings drawing attention ("cf") to equivalent or comparable (though not necessarily identical) provisions of other Acts. Abbreviations in the notes include— 1919 No 6: Conveyancing Act 1919 (as in force immediately before the enactment of this Act), 1983 No 179: Protected Estates Act 1983 (as in force immediately before the enactment of this Act). 4 When is a person incommunicate? (cf 1919 No 6, s 163D) (1) For the purposes of this Act, a person is incommunicate if— (a) the person suffers from any physical or mental incapacity (whether of a temporary or permanent nature) that makes the person unable— (i) to understand communications respecting the person's property or affairs, or (ii) to express the person's intentions respecting the person's property or affairs, or (b) the person is unable to receive communications respecting the person's property or affairs because the person cannot be located or contacted. (2) Without limiting subsection (1) (a), a person may be incommunicate even if the incapacity concerned is induced by any drug or by medical or other treatment. 5 Vacancy in office of attorney (cf 1919 No 6, s 163G (3)) For the purposes of this Act, there is a vacancy in the office of an attorney if— (a) the appointment of the attorney is revoked, or (b) the attorney renounces the power, or (c) the attorney dies, or (d) the attorney becomes bankrupt, or (e) where the attorney is a corporation, the corporation is dissolved, or (f) the attorney, by reason of any physical or mental incapacity, ceases to have the capacity to continue to act as an attorney, or (g) in such other circumstances as may be prescribed by the regulations for the purposes of this paragraph. 6 Application of Act (1) Act applies to instruments executed on or after commencement This Act applies to any power of attorney created (or purporting to have been created) by an instrument executed on or after the commencement of this section. (2) Act does not generally apply to existing powers of attorney This Act does not apply to any power of attorney created (or purporting to have been created) by an instrument executed before the commencement of this section, except as provided by subsection (5). (3) Repealed provisions of Conveyancing Act 1919 continue to apply to existing powers of attorney Subject to subsection (5), the provisions of Part 16 of, and Schedule 7 to, the Conveyancing Act 1919 (and of any regulations made under those provisions) as in force immediately before the commencement of this section continue to apply to any power of attorney created (or purporting to have been created) by an instrument executed before that commencement despite the repeal of those provisions by this Act. (4) Schedule 1 contains copy of repealed provisions of Conveyancing Act 1919 Schedule 1 contains a copy of the provisions of Part 16 of, and Schedule 7 to, the Conveyancing Act 1919 as in force immediately before the commencement of this section. Note. The copy of the provisions of Part 16 of, and Schedule 7 to, the Conveyancing Act 1919 contained in Schedule 1 does not include the definitions for certain terms used in those provisions that are contained in section 7 of the Conveyancing Act 1919. The regulations made under those provisions have also not been included in the Schedule. (5) Certain provisions of this Act extend to existing powers of attorney The provisions of section 25 (Recognition of enduring powers of attorney made in other States and Territories), Part 5 (Review of powers of attorney) and Division 3 of Part 6 (Registration of powers of attorney) extend to any power of attorney created (or purporting to have been created) by an instrument executed before the commencement of this section. (6) Certain references in Part 5 extended to existing powers of attorney For the purposes of subsection (5)— (a) a reference in Part 5 to an enduring power of attorney is taken to include a reference to a power of attorney that was a protected power of attorney under Part 16 of the Conveyancing Act 1919 immediately before its repeal, and (b) a reference in Part 5 to an irrevocable power of attorney is taken to include a reference to a power of attorney to which section 160 of the Conveyancing Act 1919 applied immediately before its repeal. (7) Subsection (5) does not affect current proceedings Nothing in subsection (5) affects the continued operation of the provisions of the Conveyancing Act 1919 and regulations made under that Act (as continued in force by subsection (3)) in relation to any proceedings commenced, but not finally determined, under those provisions before the commencement of this section. 7 Application of general law to powers of attorney (1) This Act does not affect the operation of any principle or rule of the common law or equity in relation to powers of attorney except to the extent that this Act provides otherwise, whether expressly or by necessary intention. (2) This Act does not affect the operation of Part 3 of the Conveyancing Act 1919 except to the extent that this Act provides otherwise, whether expressly or by necessary intention. Note. Part 3 of the Conveyancing Act 1919 contains general provisions relating to the execution and effect of deeds. Part 2 Prescribed powers of attorney 8 Creation of prescribed power of attorney An instrument (whether or not under seal) that is in or to the effect of a form prescribed by the regulations for the purposes of this section and is duly executed creates a prescribed power of attorney for the purposes of this Act. 9 Powers conferred by prescribed power of attorney (cf 1919 No 6, s 163B (1) and (3)) (1) Subject to this Act, a prescribed power of attorney confers on the attorney the authority to do on behalf of the principal anything that the principal may lawfully authorise an attorney to do. (2) A prescribed power of attorney has effect subject to compliance with any conditions or limitations specified in the instrument creating the power. 10 Prescribed power of attorney does not confer authority to act as trustee (cf 1919 No 6, s 163B (2) (a)) A prescribed power of attorney does not confer authority to exercise any function as a trustee that is conferred or imposed on the principal. 11 Prescribed power of attorney does not generally confer authority to give gifts (1) A prescribed power of attorney does not authorise an attorney to give a gift of all or any property of the principal to any other person unless the instrument creating the power expressly authorises the giving of the gift. Note. This subsection restates a rule of the general law. Accordingly, whether a gift of all or any of the property of a principal is expressly authorised by a prescribed power of attorney is to be determined by reference to the general principles and rules of the common law and equity concerning the interpretation of powers of attorney. (2) Without limiting subsection (1), a prescribed power of attorney that includes the prescribed expression for the purposes of this subsection set out in Schedule 3 authorises an attorney to give the kinds of gifts that are specified by that Schedule for that expression. 12 Prescribed power of attorney does not generally confer authority to confer benefits on attorneys (cf 1919 No 6, s 163B (2) (b)) (1) A prescribed power of attorney does not authorise an attorney to execute an assurance or other document, or to do any other act, as a result of which a benefit would be conferred on the attorney unless the instrument creating the power expressly authorises the conferral of the benefit. Note. This subsection restates a rule of the general law. Accordingly, whether the conferral of a benefit on an attorney is expressly authorised by a prescribed power of attorney is to be determined by reference to the general principles and rules of the common law and equity concerning the interpretation of powers of attorney. (2) Without limiting subsection (1), a prescribed power of attorney that includes the prescribed expression for the purposes of this subsection set out in Schedule 3 authorises an attorney to confer on the attorney the kinds of benefits that are specified by that Schedule for that expression. 13 Prescribed power of attorney does not generally confer authority to confer benefits on third parties (1) A prescribed power of attorney does not authorise an attorney to execute an assurance or other document, or to do any other act, as a result of which a benefit would be conferred on a third party unless the instrument creating the power expressly authorises the conferral of the benefit. Note. This subsection restates a rule of the general law. Accordingly, whether the conferral of a benefit on a third party is expressly authorised by a prescribed power of attorney is to be determined by reference to the general principles and rules of the common law and equity concerning the interpretation of powers of attorney. (2) Without limiting subsection (1), a prescribed power of attorney that includes the prescribed expression for the purposes of this subsection set out in Schedule 3 authorises an attorney to confer on a third party the kinds of benefits that are specified by that Schedule for that expression. 14 Regulations may amend Schedule 3 (1) The regulations may replace or amend Schedule 3. (2) (Repealed) 14A Effect of amendment of prescribed form or Schedule 3 The amendment or repeal of a form prescribed under section 8, or a provision of Schedule 3 that prescribes an expression or specifies a kind of gift or benefit for the purposes of section 11 (2), 12 (2) or 13 (2), does not— (a) confer any additional authority on an attorney under a power of attorney that was a prescribed power of attorney in force immediately before the day on which the amendment or repeal takes effect (an existing authority), or (b) remove any authority conferred on a principal by an existing authority, or (c) otherwise affect the continued operation of an existing authority. Part 3 Irrevocable powers of attorney 15 Irrevocable powers of attorney (cf 1919 No 6, s 160 (1)) An instrument that creates a power of attorney creates an irrevocable power of attorney for the purposes of this Act if— (a) the instrument is expressed to be irrevocable, and (b) the instrument is given for valuable consideration or is expressed to be given for valuable consideration. 16 Effect of irrevocable powers of attorney (cf 1919 No 6, s 160 (1)) (1) The power conferred by an irrevocable power of attorney is not revoked or otherwise terminated by, and remains effective despite, the occurrence of any of the following— (a) anything done by the principal without the concurrence of the attorney, (b) the bankruptcy of the principal, (c) the mental incapacity of the principal, (d) the principal becoming a mentally incapacitated person, (d1) the principal becoming a person who is a managed missing person within the meaning of the NSW Trustee and Guardian Act 2009, (e) the death of the principal, (f) if the principal is a corporation, the dissolution of the corporation. (2) Subsection (1) has effect except to the extent that the instrument creating the irrevocable power of attorney provides otherwise. Note. Division 2 of Part 5 enables the Supreme Court to order the termination of an irrevocable power of attorney in certain circumstances. Part 4 Incapacity and enduring powers of attorney Division 1 Initial and supervening mental incapacity 17 Initial mental incapacity (cf 1919 No 6, s 163E (1) and (2)) (1) Subject to this Act, a power of attorney is not ineffective only because any act within the scope of the power is of such a nature that it was beyond the understanding of the principal through mental incapacity at the time the power is given. (2) However, a power of attorney does not authorise an attorney to do any such act unless it is authorised by or under this Act. Note. Division 3 of Part 5 contains provisions that enable the Supreme Court to confirm the operation of a power of attorney despite the mental incapacity of the principal at the time the power is given. 18 Supervening mental incapacity does not affect validity of acts principal understands (cf 1919 No 6, s 163F (1)) A power of attorney is effective to the extent that it concerns any act within its scope that is of such a nature that is not beyond the understanding of the principal through mental incapacity at the time of the act. Note. Division 2 makes provision for enduring powers of attorney, which can have effect in relation to acts that are beyond the understanding of the principal through mental incapacity at the time of the act. Division 2 Enduring powers of attorney 19 Creation of enduring power of attorney (cf 1919 No 6, s 163F (2)) (1) An instrument that creates a power of attorney creates an enduring power of attorney for the purposes of this Act if— (a) the instrument is expressed to be given with the intention that it will continue to be effective even if the principal lacks capacity through loss of mental capacity after execution of the instrument, and (b) execution of the instrument by the principal is witnessed by a person who is a prescribed witness (not being an attorney under the power), and (c) there is endorsed on, or annexed to, the instrument a certificate by that person stating that— (i) the person explained the effect of the instrument to the principal before it was signed, and (ii) the principal appeared to understand the effect of the power of attorney, and (iii) the person is a prescribed witness, and (iv) the person is not an attorney under the power of attorney, and (v) the person witnessed the signing of the power of attorney by the principal. (2) In this section— prescribed witness means— (a) a registrar of the Local Court, or (b) an Australian legal practitioner, or (c) a licensee under the Conveyancers Licensing Act 2003, or an employee of the NSW Trustee and Guardian or a trustee company within the meaning of the Trustee Companies Act 1964, who has successfully completed a course of study approved by the Minister, by order published in the Gazette, for the purposes of this paragraph, or (d) a legal practitioner duly qualified in a country other than Australia, instructed and employed independently of any legal practitioner appointed as an attorney under the instrument, or (e) any other person (or person belonging to a class of persons) prescribed by the regulations for the purposes of this paragraph. 20 Enduring power of attorney does not confer authority until attorney accepts appointment (1) An enduring power of attorney does not operate to confer any authority on an attorney until the attorney has accepted the appointment by signing the instrument creating the power. (2) If more than one attorney is appointed by an enduring power of attorney, the power of attorney operates to confer authority only in relation to such of the attorneys who accept their appointments as provided by subsection (1). (3) An attorney may accept the appointment at the time the instrument creating the enduring power of attorney is executed or at any time after it is executed. (4) To avoid doubt, this section extends to substitute attorneys. 21 Effect of enduring power of attorney (cf 1919 No 6, s 163F (2), (3) and (4)) (1) Subject to this Act, an act done by an attorney that is within the scope of the power conferred by an enduring power of attorney and that is of such a nature that it is beyond the understanding of the principal through mental incapacity at the time of the act is as effective as it would have been had the principal understood the nature of the act at that time. (2) This section does not save a power of attorney from being or becoming ineffective by reason of any matter other than mental incapacity of the principal arising after the execution of the instrument creating the power. (3) This section applies only if and to the extent that a contrary intention is not expressed in the instrument creating the power and has effect subject to the terms of the instrument creating the power. 22 Effect of ademptions of testamentary gifts by attorney under enduring power of attorney (cf 1983 No 179, s 48) (1) Any person who is named as a beneficiary (a named beneficiary) under the will of a deceased principal who executed an enduring power of attorney has the same interest in any surplus money or other property arising from any sale, mortgage, charge or disposition of any property or other dealing with property by the attorney under the power of attorney as the named beneficiary would have had in the property the subject of the sale, mortgage, charge, disposition or dealing, if no sale, mortgage, charge, disposition or dealing had been made. (2) The surplus money or other property arising as referred to in subsection (1) is taken to be of the same nature as the property sold, mortgaged, charged, disposed of or dealt with. (3) Except as provided by subsection (4), money received for equality of partition and exchange, and all fines, premiums and sums of money received on the grant or renewal of a lease where the property the subject of the partition, exchange, or lease was real estate of a deceased principal are to be considered as real estate. (4) Fines, premiums and sums of money received on the grant or renewal of leases of property of which the deceased principal was tenant for life are to be considered as the personal estate of the deceased principal. (5) This section has effect subject to any order of the Supreme Court made under section 23. (6) A person is named as a beneficiary under a will for the purposes of this section if— (a) the person is referred to by name in the will as being a beneficiary, or (b) the person answers a description of a beneficiary, or belongs to a class of persons specified as beneficiaries, under the will. (7) This section does not apply to any person to whom section 83 of the NSW Trustee and Guardian Act 2009 applies. 23 Supreme Court may make orders confirming or varying operation of section 22 (1) On the application of a named beneficiary referred to in section 22 (1) or such other person as the Supreme Court considers has a proper interest in the matter, the Supreme Court may— (a) make such orders and direct such conveyances, deeds and things to be executed and done as it thinks fit in order to give effect to section 22, or (b) if it considers that the operation of section 22 (1) and (2) would result in one or more named beneficiaries gaining an unjust and disproportionate advantage, or suffering an unjust and disproportionate disadvantage, of the kind not contemplated by the will of the deceased principal—make such other orders as the Court thinks fit to ensure that no named beneficiary gains such an advantage or suffers such a disadvantage. (2) An order made by the Supreme Court under subsection (1) (b)— (a) may provide that it has effect as if it had been made by a codicil to the will of the deceased principal executed immediately before his or her death, and (b) has effect despite anything to the contrary in section 22. (3) An application under subsection (1) must be made within 6 months from the date of the grant or resealing in this State of probate of the will or letters of administration unless the Supreme Court, after hearing such of the persons affected as the Supreme Court thinks necessary, extends the time for making the application. (4) An extension of time granted under subsection (3) may be granted— (a) on such conditions as the Supreme Court thinks fit, and (b) whether or not the time for making an application under this section has expired. 24 (Repealed) 25 Recognition of enduring powers of attorney made in other States and Territories (1) An interstate enduring power of attorney has effect in this State as if it were an enduring power of attorney made under, and in compliance with, this Act, but only to the extent that the powers it gives under the law of the State or Territory in which it was made could validly have been given by an enduring power of attorney made under this Act. (2) In particular, an interstate enduring power of attorney to which subsection (1) applies— (a) has effect in this State subject to any limitations on the power that apply to it under the law of the State or Territory in which it was made, and (b) does not operate to confer any power on an attorney in this State that cannot be conferred on an attorney under an enduring power of attorney made in this State. (3) Subsection (1) does not apply to any power of attorney (or class of powers of attorney) prescribed by the regulations. (4) A document signed by an Australian legal practitioner that certifies that an interstate enduring power of attorney was made in accordance with the formal requirements of the law of the State or Territory in which it was made is admissible in any proceedings concerning that power and is prima facie evidence of the matter so certified. (5) In this section— interstate enduring power of attorney— (a) means a power of attorney made by instrument in another State or Territory that, under the law of the State or Territory, has effect in the State or Territory as a valid power of attorney even if the principal loses capacity through mental incapacity after the execution of the instrument, and (b) includes an instrument in the nature of an enduring power of attorney, however described. Part 5 Review of powers of attorney Division 1 General 26 Review tribunals Each of the following is a review tribunal for the purposes of this Part— (a) the Civil and Administrative Tribunal, (b) the Supreme Court. 27 Concurrent jurisdiction of review tribunals (1) If a provision of this Part confers a function on any review tribunal, the jurisdiction to exercise that function is conferred on each review tribunal concurrently. (2) A person cannot make an application to a review tribunal for the exercise of a function conferred on the tribunal by this Part if the person has already applied to another review tribunal for the exercise of the same function in respect of the same (or substantially the same) matter. (3) However, subsection (2) does not prevent a person from making an application to a review tribunal for the exercise of a function under this Part if the earlier application for the exercise of the same function has been withdrawn with the approval of the review tribunal in which the application was made. (4) Subsections (1)–(3) do not apply to a provision of this Part that confers a function on the Civil and Administrative Tribunal or the Supreme Court expressly. Division 2 Termination of irrevocable powers of attorney 28 Supreme Court may order the termination of irrevocable power of attorney (cf 1919 No 6, s 160 (2)) The Supreme Court may order that an irrevocable power of attorney is terminated and may order that the instrument creating the power be delivered up for cancellation if the Court considers that— (a) the objects of the power of attorney have been carried out, or (b) the objects of the power of attorney have become incapable of being carried out, or (c) the power of attorney is otherwise exhausted. Division 3 Confirmation of powers conferred when principal mentally incapacitated 29 Supreme Court may make orders confirming powers understood by principal (cf 1919 No 6, s 163E (3)) The Supreme Court may, on the application of a principal under a power of attorney, confirm (whether in whole or in part) any power to do an act under the power of attorney if it appears to the Court that the nature of the act was not beyond the understanding of the principal through mental incapacity at the time when the power was given. 30 Supreme Court may make orders confirming powers subsequently affirmed by principal (cf 1919 No 6, s 163E (4)) The Supreme Court may, on the application of a principal under a power of attorney, confirm (whether in whole or in part) any power to do an act under the power of attorney that was beyond the understanding of the principal through mental incapacity at the time the power was given to the extent that it appears to the Court that— (a) the principal has affirmed the power before or during the proceedings on the application, and (b) the principal had sufficient mental capacity to affirm the power at the time the affirmation was made. 31 Supreme Court may make orders confirming powers in best interests of principal (cf 1919 No 6, s 163E (5) and (7)) (1) The Supreme Court may, on the application of a principal under a power of attorney (whether or not an enduring power of attorney), confirm (whether in whole or in part) any power to do an act under the power of attorney if it appears to the Court that— (a) the principal is incapable of affirming the power because— (i) the principal lacks capacity by reason of the continuation of mental incapacity that affected the principal when the principal gave the power, or (ii) the principal is incommunicate, and (b) it is for the benefit of the principal that the power be confirmed in whole or in part. (2) Subsection (1)— (a) applies only if and to the extent that a contrary intention is not expressed in the instrument creating the power of attorney, and (b) has effect subject to the terms of the instrument creating the power of attorney. 32 Effect of orders made by Supreme Court under this Division (cf 1919 No 6, s 163E (6)) If the Supreme Court makes an order under this Division confirming a power of an attorney (whether in whole or in part), any act done by the attorney after the order takes effect that is within the scope of the power is, to the extent it is confirmed, taken to be as good for all purposes and between all persons as if, at the time when the order took effect, the principal were of full capacity and had in due form confirmed the power of attorney to the extent of the order of confirmation. Division 4 Review of enduring powers of attorney and other powers 33 Reviewable powers of attorney (cf 1919 No 6, s 163G (1)) (1) A power of attorney is a reviewable power of attorney for the purposes of an application under this Division if the review tribunal to which the application is to be made has jurisdiction to deal with the application as provided by this section. (2) Both the Civil and Administrative Tribunal and the Supreme Court have jurisdiction to deal with an application under this Division in respect of an enduring power of attorney (including a revocation of an enduring power of attorney). (3) The Supreme Court (but not the Civil and Administrative Tribunal) also has jurisdiction to deal with an application under this Division in respect of any other power of attorney given by a principal who is incommunicate for the time being. (4) To remove any doubt, references in this Division to a reviewable power of attorney extend to a document purporting to be a reviewable power of attorney and to the making or revocation of a power of attorney extend to the purported making or revocation of a power of attorney. 34 Referral of application to different review tribunal (1) Whether or not on its own initiative, the Supreme Court may refer an application made to it under this Division in respect of an enduring power of attorney or a revocation of an enduring power of attorney to the Civil and Administrative Tribunal and the Civil and Administrative Tribunal may refer such an application made to it to the Supreme Court. (2) Without limiting the matters that a review tribunal may take into account in deciding whether or not to refer such an application, the review tribunal m