If your business uses Powers of Attorney in Victoria (e.g. financial services businesses could use them for MDAs and quasi-MDAs under ASIC’s No Action Letter) the law will change as at 1 September 2015 and will affect you. If so, you should have your POAs reviewed for compliance with the new requirements.
While POAs entered prior to 1 September will still be valid, any new POAs entered on or after 1 September need to meet the requirements in the new Powers of Attorney Act 2014 (Vic).
As the relevant parts of the Instruments Act are being repealed, any new POAs post 1 September will need to refer to the Powers of Attorney Act instead and POAs will need be in the prescribed form. Note that while the prescribed form for general POAs has been provided, the prescribed form for Enduring POAs has not yet been made available. Here are the main changes with the introduction of the Powers of Attorney Act (Vic) on 1 Sep 15:
• repeals Part XI (powers of attorney) and Part XIA (enduring powers of attorney) of the Instruments Act 1958 (Vic) and the provisions under the Guardianship and Administration Act 1986 (Vic) relating to the appointment of enduring guardians
• provides for general powers of attorney (including powers of attorney for security) and enduring powers of attorney for financial matters and personal matters
• more onerous duties on an attorney when exercising the power, carrying out a function or performing a duty under the Act;
• makes provision for a further (unremunerated) appointment – that of supportive attorney – to support the person in making and giving effect to some decisions. The principal remains the decision maker
• defines the meaning of decision making capacity
• clarifies various aspects of the law – for example, conflict transactions and permitted conflict transactions and when an attorney can make gifts of the principal’s property
• gives examples of matters for which a principal (formerly donor) cannot appoint an attorney
• expands the VCAT jurisdiction and provides that VCAT may order an attorney under an enduring power of attorney to compensate the principal for a loss caused by the attorney contravening a provision of the Act
• creates new offences – for example, it is an offence for a person to dishonestly obtain an enduring power of attorney or revocation of an enduring power of attorney to obtain financial advantage for the person or another person, or to cause loss to the principal or another person.
If you are in any doubt about whether your POAs will meet the new requirements, call imac legal and we can help.