Common Mistakes When Creating or Using a Power of Attorney in Queensland

A Power of Attorney (POA)—especially an Enduring Power of Attorney (EPA)—gives someone the authority to handle your financial, personal, and health decisions if you’re unable to do so yourself. However, mistakes during drafting or in how the attorney exercises their powers can cause significant problems.

This guide examines frequent errors people make when creating or using a Power of Attorney in Queensland, along with practical tips to avoid them and ensure your affairs are protected.

Introduction

A POA can provide invaluable peace of mind, knowing a trusted person can step in to manage your money, healthcare decisions, or both if you become incapable or simply unavailable. But oversights—like an improperly witnessed document, a vague scope of authority, or choosing someone ill-suited—can undermine that reassurance.

“A Power of Attorney is only as robust as the care put into its drafting and the diligence shown by the attorney. Small oversights can quickly lead to disputes.”
— Wills & Estates Lawyer, QEL

This article highlights typical pitfalls at each stage: from creating the document through to using it in daily life.

Mistakes in Drafting the Power of Attorney

Failing to Select the Correct Type of POA

Queensland recognises:

• General Power of Attorney: Suitable for short-term or specific tasks (e.g., selling a car while you’re overseas). Ends if you lose capacity.
• Enduring Power of Attorney (EPA): Continues even if you lose capacity. Covers financial, personal, or health decisions (or some combination).

Mistake: People sometimes sign a general POA but wrongly assume it endures past capacity loss. When they do lose capacity, the attorney’s powers end, leaving the family in limbo.

Solution: Understand the difference. If you want someone to keep acting if you become incapacitated, choose an Enduring Power of Attorney. If it’s for a one-off event, a general POA suffices.

Incorrect or Inadequate Witnessing

Mistake: Having a relative who benefits under the will, or the appointed attorney themself, witness the signature. Queensland laws require an eligible witness (e.g., lawyer, justice of the peace, commissioner for declarations) not related to you or your attorney.

Solution: Carefully confirm the witness’s eligibility. If you’re uncertain, consult a professional or a JP to ensure validity. An ineligible witness can render the POA void or challengeable.

Overly Vague Instructions

Mistake: “My attorney can handle my finances” might be too broad, leading to confusion or misuse. On the other hand, you may inadvertently restrict their powers so much that they cannot manage urgent matters effectively.

Solution: Strike a balance. Clarify which bank accounts they can access, whether they can sell property, or if they must consult other family members for major transactions. Specific instructions can prevent attorney overreach or unintentional roadblocks.

(Tip: Mark conditions like “The attorney must consult my financial adviser before any investment changes over $10,000” to ensure transparency.)

Appointing Multiple Attorneys Without Clear Roles

Mistake: Naming two or more attorneys but not stating how they make decisions—jointly (must agree) vs. severally (any can act alone). This can cause stalemates if they disagree.

Solution: If you do appoint multiple attorneys, specify their decision-making method. If they must act together on large decisions (like selling a house) but can act individually on smaller tasks, note that in the document.

“Clear instructions on how attorneys collaborate minimises friction and confusion, especially for property or high-value transactions.”
— Senior Paralegal, QEL

Mistakes When Choosing an Attorney

Selecting Someone Without Financial or Health Knowledge

Mistake: Placing your complex finances in the hands of a relative who struggles with budgeting or lacks financial literacy. Or assigning health decisions to someone uninterested in your medical preferences.

Solution: Evaluate each candidate’s skills and reliability. Don’t be swayed solely by closeness of relationship—competence matters too. In some cases, separate attorneys for finances vs. health/personal decisions can be beneficial.

Not Checking Their Willingness or Availability

Mistake: Naming your child who lives overseas without confirming if they can handle frequent banking or medical visits from afar. Or, they might be too busy or uncomfortable with the responsibility.

Solution: Always discuss the role in detail. Confirm if they can undertake tasks promptly (e.g., signing documents at a local bank). If they seem hesitant or unreachable, consider a local alternative or a professional attorney.

Overlooking Potential Conflicts of Interest

Mistake: An attorney stands to inherit or personally gain from certain financial decisions. For instance, they might be a part-owner of a property you co-own, or they want to sell assets against your known wishes.

Solution: If conflicts can’t be avoided, add conditions or consider naming a second attorney to approve major decisions. Ensure instructions emphasise your intentions—like not selling certain heirlooms—unless necessary for care expenses.

Mistakes in Using the POA After It’s Created

Not Informing Relevant Institutions

Mistake: You finalise a valid EPA but don’t tell your bank, insurer, or care facility until an emergency arises. At that point, staff may hesitate to honour the attorney’s instructions or demand extra proof, delaying urgent actions.

Solution: Provide copies of the POA to banks or major financial institutions once it’s finalised. Let them record the attorney’s authority so they can step in swiftly if needed.

Failing to Activate the EPA Properly

Some Enduring Powers of Attorney commence only upon loss of capacity or a certain date/event. If no one obtains a doctor’s certificate of incapacity, for instance, the attorney might not feel authorised to act.

Solution: Identify triggers precisely (e.g., “upon written certification by a GP stating I lack capacity”). Confirm that the attorney understands the requirement and how to prove it to third parties.

“If your EPA says it starts upon losing capacity, specify how to determine that capacity is lost—vague wording can delay vital decisions.”
— Medical Social Worker, QLD Clinic

Using the POA Beyond Its Scope

Mistake: The attorney uses your funds for personal expenses or sells property contrary to your explicit instructions. Or they meddle in health decisions if only authorised for financial matters.

Solution: The principal, if still capable, can demand accountability or revoke the POA. If the principal lost capacity, concerned family members can contact the Office of the Public Guardian or the Queensland Civil and Administrative Tribunal (QCAT) to investigate misuse.

Danger Signs of Potential Attorney Misuse

1. Unusual Bank Transfers: Large sums moved to the attorney’s personal account, unexplained spending sprees, or new credit lines.
2. Principal Feeling Isolated: The attorney discourages visits or phone calls, controlling the principal’s interactions.
3. Sudden Asset Sales: Particularly if the principal previously insisted on keeping property for sentimental reasons.

(If you suspect misconduct, gather evidence—bank statements, emails, medical feedback—and seek legal guidance promptly.)

Table: Quick Reference to Common POA Mistakes and Solutions

Correcting Mistakes or Disputes

Updating or Revoking the POA

If you retain capacity and discover an error—like naming the wrong attorney or forgetting a crucial clause—you can:

• Revoke the existing POA by signing a revocation form, properly witnessed.
• Draft a New POA that rectifies the oversight (e.g., clarifies scope, picks a new attorney).

(See “Updating or Revoking a Power of Attorney: Key Steps and Considerations” for details.)

Reporting Concerns or Abuse

If capacity is lost but family or friends see potential misuse:

1. Confront the Attorney: Demand an explanation or financial records.
2. Seek Mediation: If it’s a genuine misunderstanding, open dialogue might suffice.
3. Notify the Office of the Public Guardian: They investigate if exploitation or neglect is suspected.
4. Apply to QCAT: QCAT can revoke or alter the POA, or appoint a new administrator/guardian if abuse is established.

“When red flags of financial abuse appear, acting quickly is critical. Delays can let more funds vanish or allow negligence to continue.”
— Dispute Resolution Advocate, QEL

Preventing Mistakes Before They Happen

1. Plan Early
   • Don’t rush to create a POA in a moment of crisis. Take time to choose the right attorney(s) and discuss concerns or potential conflicts.
2. Be Specific with Instructions
   • If you have strong views—like not selling the family home or a preference for certain medical treatments—note these explicitly.
3. Use a Lawyer for Complex Situations
   • Multiple attorneys? Business ownership? Family dynamics? Legal professionals can tailor the POA, preventing unclear or conflicting clauses.
4. Review Regularly
   • Life changes—marriage, divorce, relocating overseas—may require updating your POA. Regular check-ups keep it aligned with your current circumstances.

(Quote: “Prevention is better than legal battles. A thoughtful POA, updated as needed, spares families from costly court fights.” — Estate Planning Specialist, QEL)

Frequently Asked Questions (FAQ)

Q1: Can my attorney handle both financial and health decisions under one POA?
A: Yes, if you designate them for both domains in an Enduring Power of Attorney document. Alternatively, you can pick separate attorneys for each area.

Q2: Is it a problem if my attorney is also a beneficiary in my will?
A: Not necessarily, but it can raise conflicts of interest. Clear instructions and some oversight may mitigate potential misuse.

Q3: How do I ensure my attorney doesn’t change my investments recklessly?
A: Specify limits (like requiring a second sign-off for large transactions) or direct them to follow certain investment guidelines. Checking in with them if you still have partial capacity also helps.

Q4: My attorney lives interstate—can they still manage my finances effectively?
A: Possibly, especially with online banking. But if frequent in-person tasks (e.g., meeting bank officers, property inspections) are needed, it might be less convenient. Communication channels matter.

Conclusion

Common mistakes—from mischoosing an attorney to failing to detail the scope of powers or using an invalid witness—can jeopardise the protection and clarity a Power of Attorney is meant to provide. By acknowledging typical errors at each stage, families and individuals in Queensland can craft a POA that truly safeguards the principal’s interests and respects their intentions.

Key Takeaways:

1. Use the Correct EPA if you want authority to endure after capacity loss, rather than a general POA.
2. Select Reputable Witnesses and Draft Precisely, clarifying all decision-making processes.
3. Regularly Revisit the POA post-life changes (like marriage, property acquisitions, or relocations).
4. Communicate: Let banks, family members, and relevant institutions know about the POA, so everyone understands the attorney’s role.

When done correctly, a Power of Attorney can ease burdens during challenging times—ensuring finances, healthcare, and personal matters are managed without undue hassle or confusion. With mindful planning and an eye for potential pitfalls, it remains one of the most valuable documents in any Queensland estate plan.