Power of Attorneys, or POAs, are an agreement enabling a person (or people) to act on behalf of another person. They allow the person accepting the power (the donee) to transact on property, so the settlement process can be impacted if a Power of Attorney is involved.
Power of Attorneys come in different forms, but the types we most commonly see are:
1. Enduring Power of Attorney
An enduring Power of Attorney enables a person (or people) to make any financial and property decisions on behalf of another person (referred to as the donor), until revoked.
These decisions may include selling or purchasing property, carrying out banking, or collecting debts. An enduring Power of Attorney might be granted to a family member, a close friend, or another person that the donee trusts to manage their financial and property decisions even if the donor loses full legal capacity.
2. Limited Powers of Attorney
Powers of Attorney agreements can also be limited, allowing the donee(s) to perform specific tasks only. They will also specify a time the POA is in force for.
If a home owner is out of the country but wishes to sell their home, for example, they may provide limited Powers of Attorney to someone they trust who lives locally, allowing that person to carry out the property transaction on their behalf.
Before granting Powers of Attorney, think carefully about your decision and consider seeking legal advice. If more than one donee has been appointed, you will also need to decide if only one attorney needs to sign documents (referred to as ‘jointly and severally’), or if both attorneys need to sign (‘jointly’).
When it comes time for settlement, the most commonly forgotten (but very important) aspect of Power of Attorney is lodgement with Landgate. If you are selling or purchasing property using Powers of Attorney, the POA documentation must be lodged before a property can be sold or purchased on behalf of the donor.
It’s recommended that you lodge two signed copies of the Power of Attorney documents, one to be retained by Landgate and one to be returned as the client original. Further, if the POA is lodged three or more months after being signed, a statutory declaration must also be lodged to prove that the POA has not been revoked.
Ensure the Power of Attorney and any other required documentation is lodged with Landgate, and you’re well on your way to a smooth property . Contact Landgate for more information.
Image by John Patrick Robichaud via Flickr.