22 Aug 2016

Newsletter | August 2016 | Legal update

EPA forms should be more straightforward in the future
EPA forms should be more straightforward in the future

Review of EPA processes

In 2014 the Minister for Senior Citizens conducted a review of the laws governing Enduring Powers of Attorney.

Specifically, she was asked to review the effectiveness of changes made in 2007 to the Protection of Personal and Property Rights Act (PPPR) 1988.

As a result of her review, the Minister recommended various amendments to the Act. She recognised a concerning trend that, in recent years, there has been a steady reduction in the number of people signing Enduring Powers of Attorney.

There are simple reasons for this. Strict requirements were enacted in 2007 requiring proper legal advice and strict rules for witnessing an Enduring Power of Attorney.

As a result, the time taken to give clear and understandable explanations increased, as did the cost – as frequently more than one witness, often lawyers, needed to be involved in the witnessing process.

Unfortunately, this had the effect of putting some people off making EPAs. The Minister’s recent recommendations are intended to make the EPA forms and processes simpler, easier and cheaper.

Many of the proposals are technical changes. They relate to areas such as who can witness the donor and the attorney (potentially now the same person), revoking earlier EPAs, and the information to be provided in medical certificates. These changes are welcomed by Perpetual Guardian.

We are very mindful of the potential for family and other people to abuse their position of power when appointed as attorney. The team at Perpetual Guardian will continue to make full enquiries and take adequate time to provide a proper explanation of the terms of an Enduring Power of Attorney. We will ensure a person understands how it can be tailored to their own unique family situation and what the risks and benefits are.

Changes to relationship property legislation

Most New Zealanders have a little knowledge and some understanding of our relationship property legislation.

The Property (Relationships) Act 1976 is legislation which sets out the rules for how relationship property is dealt with in different situations, including separation and death.

In 2002, this was amended in a number of important ways, including extending its application to de facto relationships.

However, the law has not been comprehensively reviewed within the last ten years and the Law Commission has now been given the task of reviewing the Act to ensure it continues to operate effectively.

At Perpetual Guardian, we will closely follow the Law Commission’s review and will be making submissions to the Commission as there are a number of areas within the review which are of particular interest. Amongst other matters, the Law Commission will be reviewing how the Act deals with property held in trust and the powers of the courts in this area. It is also tasked with reviewing the provisions relating to the division of property on death. It is understood that the Law Commission will issue its report in November 2018.

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