We know that we need a will if we die but what do we need if we become incapacitated?

We all have the right to make decisions about our own personal affairs, but sometimes due to either illnesses or accidents, we lose the ability to so.

Unfortunately, if you lose mental capacity, you cannot assume that relatives can simply access your financial affairs or make decisions about your healthcare. Your loved ones may have to spend time and money going through court to gain access or control.

However, you can avoid this by giving a family member or close friend Power of Attorney. Different countries have different ones and names. For Hong Kong, you can have a General Power of Attorney in place at any time (they handle your financial affairs on your behalf) but if you lose mental capacity then you must have an Enduring Power of Attorney in place – the General one would be revoked.

What is an Enduring Power of Attorney?

An Enduring Power of Attorney (EPA) is a legal document where someone nominates a trusted friend or relative to look after their affairs if they lose mental capacity.

Who should set up an EPA?

Regardless of health or age, everyone should consider setting up an EPA. It’s not necessarily dementia in old age that will affect your ability to make decisions. Young people could lose capacity through an accident or serious illness for example.

Others diagnosed with a condition likely to cause loss of capacity should consider who they would like to make their important decisions when they are no longer able to.

It’s very important that you should also have full capacity when appointing an attorney. When making an Enduring Power of Attorney in Hong Kong, both a medical officer (family doctor) and legal practitioner (lawyer) have to confirm that you have full mental capacity at the time of signing. They no longer have to be present at the same time.

Why should you set up an EPA?

We all should have a Will but this can only be dealt with when we die.

There may come a time when a qualified health practitioner assesses that we aren’t able to make these decisions ourselves – from that point on our attorney will have the power to act for us. As an alternative to it being activated straight away, we can choose for the EPA to only come into effect if this happens.

Without an enduring power of attorney, no one else can deal with our property or financial affairs on our behalf without a court order. Our family and even our partner or spouse may need to go to court to get this power. Not having an EPA can cause our loved ones a lot of (needless) stress and cost them a lot of money too.

Things our attorney can do for us include managing bank accounts, paying bills, paying school fees, or buying and selling property on our behalf – you can limit or widen their scope of control.

How do you set up an EPA?

An EPA is a separate legal document that has to be witnessed by a legal and medical practitioner then registered with the courts so that if the attorney is needed – you can state when the attorney has to act – it is an instant process.

You should consider your attorney, who is very often our spouse (you can have more than one and they can act jointly ( together) or jointly and severally (they can act together or independently)) and the duties under which they can act. You should list these under your EPA. They do not have to have complete control and are “watched” under the HK legal system to protect your estate also.

You are also free to change your attorney/s at any time but if the EPA is registered already, you would have to revoke the original and re-register using your new attorney/s.

We all need a Will to distribute our personal assets but if your loved ones rely on your income, and this is in jeopardy if you become mentally incapacitated, you should consider this valuable document to alleviate financial stress on your loved ones.

Key Advantages of an EPA

a) it allows an individual to choose the person/s who will look after their financial affairs if he/she becomes incapable of doing so

b) it avoids expensive and potentially distressing court proceedings for the appointment of another person to look after the individual’s affairs

c) it provides an efficient and cost-effective way of administering the individual’s property

d) it allows your loved ones ease of mind that they can manage your finances, looking after you and themselves