Enduring Powers of Attorney (EPA) serve as an essential legal document that enable a person (the donor) to appoint one or more individuals (the attorney(s)) to manage their financial affairs in the event of incapacity.
However, there are situations where the donor might want to revoke the EPA, either due to a change in circumstances or for other reasons.
In this blog post, I discuss the mental capacity required to revoke an EPA in Western Australia, using the KRL [2010] WASAT 187 decision as a reference.
Mental Capacity and the Revocation of an EPA
To revoke an EPA, the donor must possess the mental capacity to understand the nature and consequences of their decision. According to the High Court of Australia in Gibbons v Wright (1954) 91 CLR 423, the capacity to understand the nature of a transaction is determined by whether the person can comprehend the transaction when it is explained to them. In the context of revoking an EPA, the donor must understand the authority given to their attorney(s) and the consequences of taking away that authority.
In KRL [2010] WASAT 187, an elderly woman with cognitive impairment revoked her EPA, which had been operating to meet her need for financial management. However, the question of whether she was competent to make the revocation was raised by the appointed administrator. The tribunal examined whether the woman understood the nature and consequences of her decision, taking into consideration the evidence provided by her friend who had assisted her with the revocation process.
Presumption of Capacity and Guardianship and Administration Act
Under the Guardianship and Administration Act 1990 (WA) (GA Act), there is a presumption of capacity for individuals, meaning that a person is presumed capable of making reasonable decisions about their person and their estate until proven otherwise. This presumption mirrors the common law principle that a person is presumed to be capable of executing a document.
In KRL [2010] WASAT 187, the tribunal applied the principles of the GA Act and the general law to determine the woman's capacity to revoke her EPA. Although there were doubts about her understanding of the nature and consequences of her decision, the tribunal did not have the power to declare the validity or invalidity of the revocation under the GA Act.
The Role of the State Administrative Tribunal
The State Administrative Tribunal (SAT) in Western Australia has powers under the GA Act and the State Administrative Tribunal Act 2004 (WA) to deal with guardianship and administration matters. However, the GA Act does not grant the SAT declaratory powers in respect of the validity or invalidity of an EPA or the revocation of one. In cases where the validity of an EPA or its revocation is in question, the matter may be brought before the Supreme Court.
Key Take-Aways
Revoking an EPA in Western Australia requires the donor to possess the mental capacity to understand the nature and consequences of their decision.
While the GA Act provides a presumption of capacity, the question of whether a person is competent to revoke an EPA may still be raised in some situations.
The SAT does not have the power to declare the validity or invalidity of an EPA or its revocation; such matters may be addressed by the Supreme Court.
When seeking to revoke an EPA, it is wise to consult with a qualified guardianship lawyer to ensure that the legal requirements are met and the donor's intentions are carried out as intended.