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Enduring Power of Attorney - The Definitive Guide

Our guide explains how to make an enduring power of attorney (EPA), the benefits, costs and what to watch out for.
Updated 11 October 2024

Dementia already affects more than 50,000 people in New Zealand and is projected to affect more than 120,000 of us within 25 years. By law, relatives can't access your money even if it's to pay for essential care and treatment. Unless you have Enduring Power of Attorney (EPA) in place, your loved ones will need to apply through the Family Court to manage your affairs. This is always costly, time-consuming and stressful, so getting EPAs in advance is the best approach, and this guide explains how you do it.

You may be thinking "I don't need an EPA, I'm fit and healthy". Sadly, this is a common misunderstanding - you can ONLY set up an EPA when you have mental capacity. Once you've lost capacity, or if you become sick suddenly, it's too late, and your loved ones are forced to deal with the Family Court to make any decision about caring for your needs. This is expensive, intrusive and stressful.

EPAs can relate to your personal care and welfare, and also to you property.  An EPA in relation to your property could also be important at any time while you are unavailable or incapacitated.  For example, a number of people who may be forced into isolation for an extended time due to Covid-19 may find an enduring power of attorney enables their family to manage their affairs while they aren’t able to.

EPAs are not complicated, but we've put together a definitive guide to cover everything you need to know. This includes:
Disclaimer: While every effort has been made to ensure this article's accuracy, it does not constitute legal advice in any form. If you act on it, you do so at your own risk. We don't accept any liability for damage or loss, which may arise as a result of your reliance upon it.

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What is an Enduring Power of Attorney (EPA)?

An Enduring Power of Attorney (EPA) is a legal document. It enables you to appoint someone (i.e. the “attorney”) to make financial and care decisions on your behalf should you lack the capacity to make those decisions for yourself, due to illness or injury. Such a situation may seem like a long way off, but not having an EPA in place when you need one is a costly and stressful experience.

In terms of legal terms, there are two which matter most:
  1. Donor - the person making the EPA whose care and financial matters will be taken care of when the EPA is activated
  2. Attorney - the person who is appointed to act in the donor's interests and make care and financial decisions on their behalf and for their benefit. This is often a trusted family member or friend.

Cost Guide
  • EPAs cost around $300 to $500 to complete. Although you can get the documents at little or no cost (see below), they need to be signed in front of an “authorised witness” (usually a solicitor) who must advise the Donor and sign a certificate, which they will charge for.
  • The benefits of having a trusted loved one or friend act as your attorney to manage your affairs greatly outweigh the upfront cost.
  • However, selecting the right attorney who will ultimately make all the decisions for you is critically important.
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What is the difference between "Enduring Power of Attorney" and “Power of Attorney”?

A Power of Attorney involves someone having temporary control of:
(a) all of your affairs; or
(b) only a specific issue(s).

A Power of Attorney has a specific date that it will start and end. It's most common when a person leaves New Zealand for a period of time and wants their property, including but not limited to bank accounts, real property and investments looked after by a specific person. A normal power of attorney ceases to have effect when you lose “mental capacity”.  An Enduring Power of Attorney looks after affairs when you lose “mental capacity”, which we define below. An Enduring Power of Attorney over property can also take effect while you have mental capacity, if you choose (which many do).

Know this first – the “attorney” you appoint is not an attorney by profession

An attorney for your EPA could be a loved one, friend or business associate. It will be someone who has your best interests at heart while having the experience and confidence to make decisions about your financial and personal care and welfare. It is rare for attorneys, known in New Zealand as lawyers, to be named in an EPA, unless they are being named in their personal capacity. For this reason, the word “attorney” must not be confused with what the legal document is providing.

Understand the two types of enduring power of attorney

There are two separate EPA documents that you can set up; one that covers your property affairs and one that covers your personal care and welfare decisions. You can prepare just one, or you can prepare both. You may like to pick one person to carry out both roles, or you may like to pick two different people that you think would be most appropriate to act on your behalf (although they will need to be able to work well together in that case). 

  1. A Property EPA covers all of your property, including but not limited to bank accounts, real property and investments. This EPA allows your nominated person (or people) to use your property in your best interests. They are responsible for taking care of your finances, such as paying bills and managing investments, but also ensuring that your house is maintained and that any maintenance is taken care of. This EPA can come into effect before you lose mental capacity, for when things may become too difficult for you to manage on your own (or perhaps just away travelling). You can draft your EPA so that your nominated attorney must consult with you or others while you are mentally capable. You can choose one or more people to be your attorney for a Property EPA. For example, you may choose your spouse, partner and/or your son or daughter.
  2. A Personal Care and Welfare EPA covers all of your health, accommodation and associated care decisions. It focuses on appointing someone to make decisions about your wellbeing, such as where you live and the care that you will receive. For example, the nominated person will consult with your doctor and make decisions that are in your best interests, which may include making the decision to move you into a secure unit of a rest home rather than stay at home on your own. The Personal Care and Welfare EPA only comes into effect when a medical professional or the Family Court has declared that you are “mentally incapable”. So that there is no conflict of opinion or difficulty with decision-making, you are only allowed to have one person act as your attorney for the Personal Care and Welfare EPA.

Benefits of an Enduring Power of Attorney

  1. Managing your financial affairs is straightforward – an EPA lets your nominated attorney have access to your money. This means bills can be paid, care funded and anything you no longer need can be sold to pay for things that you do need. Without an EPA, your family cannot act on your behalf. The Family Court will decide how your property and personal matters will be managed, which isn't usually a desired situation.
  2. Those you trust most have the responsibility of looking after your welfare – whoever you appoint, their primary responsibility is to act in your best interests. By choosing those you know will be reliable, and putting in place protective measures such as requiring them to consult or inform others on key things, you can be comfortable your financial and personal wellbeing will be kept.
  3. Your financial affairs will remain confidential – your EPA appoints one (or more) persons to manage your property who will ensure no one else needs to know about your property. For families with a history of conflict, this can be helpful.

What to watch out for:

  1. ​The “Attorney” you appoint won't be monitored unless you specify, nor will they be guided on how to act. There is no legal “best practice” for how to be an “attorney”. The person you select will have the responsibility of making the most important decisions for your benefit. You can add requirements into the EPA for the attorney to have to consult with certain people (either on every decision, or those you identify). You can also require that certain people be given information (e.g. copies of your bank statements) so they can keep an eye on things.
  2. You'll need to think carefully about who to choose as your attorney. The role can be abused or neglected, meaning your welfare may suffer. The best attorney is someone you have known for a long time, trust profoundly and has demonstrated they will act in your best interests. Most importantly, the person can be trusted to not benefit financially from their role as your attorney. 
Next Steps: How to make an Enduring Power of Attorney
Once you've decided on who to choose as your attorney, you will choose how to draft the documents.  There are lots of options:
  1. You can download and complete the forms yourself, for free, from the MSD website. But that is not an easy or recommended approach.  
  2. Another alternative, and our suggestion, is an online provider such as LawHawk, who offer combinations of online wills and enduring powers of attorney. LawHawk is offering a package of a will and both EPA documents for $59.90, which is the cost of their will per our wills guide (so the EPA documents are effectively free). You may find an online solution, with its automation and guidance, faster and easier to complete your documents than using the MSD website.
  3. Whether you use the MSD or an online service, you will still need to visit a local lawyer or a trustee corporation (like Public Trust) to arrange the signing and witnessing. It is their job to make sure you understand what the EPA means, what it will do, and the responsibilities of your appointed attorney. The legal professional will also make sure it is valid under the law so it can be used if and when it's needed. Because you need to see a lawyer or a trustee corporation anyway, if the total costs are acceptable, you may choose to ask them to do the whole thing for you. 

​Warning: Make sure you are comfortable with your choice of attorney. In some instances, a person volunteers because it means they will have access to the donor's money. Make sure your family is comfortable with the choice to avoid problems later on.

What is "mental capacity"?

Every day we make decisions about our lives - the ability we have to make these decisions is called mental capacity. Those most vulnerable often lack mental capacity - for example, those with dementia, a brain injury, or suffering the effects of a stroke.

A Property EPA can be activated when the person still had mental capacity - such a decision will be made by the donor.
For a Personal Care and Welfare EPA to come into effect, the donor must lack the capacity to manage his or her affairs. Only medical professionals can determine if the person with the EPA is mentally incapable.

For a Personal Care and Welfare EPA, the donor becomes mentally incapable if they are:
  1. Unable to make decisions about their care and welfare, or
  2. Unable to understand those decisions, or
  3. Unable to know those consequences of those decisions; or
  4. Unable to communicate decisions that they make about their care and welfare.

For a Property EPA, the donor becomes mentally incapable if they are unable to manage their property affairs.

In both assessments, it is assumed that the donor can make, understand and communicate decisions about their property and their care and welfare unless it’s proved otherwise. Importantly, the donor is not presumed to be ‘mentally incapable’ just because someone has arranged for their mental capacity to be assessed.

How is the assessment made?
The Hawkes Bay District Health Board has published a useful guide which outlines what questions a medical practitioner will ask, and what they will look for in their assessment. This can include asking about living arrangements, support requirements, assessing appropriate dress and personal hygiene, testing decision-making skills and processes, as well as assessing the potential risks to the patient, for example, malnutrition, injuries, and medication errors.
Once the medical professional is satisfied the patient doesn't have mental capacity, the following happens:
  1. If the patient has already appointed an attorney through an EPA, this person can now take over this role.
  2. If there is no EPA in place, a welfare guardian or property manager may need to be appointed through the Family Courts.

How to make an Enduring Power of Attorney

The first step is to think about who you would like to act as your attorney, and what you want them to do for you. The most common people to consider include your spouse, partner and children. Some people also select their parents.
Next Steps: How to make an Enduring Power of Attorney
Once you've decided on who to choose as your attorney, you will choose how to draft the documents.  There are lots of options:
  1. You can download and complete the forms yourself, for free, from the MSD website. But that is not an easy or recommended approach.  
  2. Another alternative, and our suggestion, is an online provider such as LawHawk, who offer combinations of online wills and enduring powers of attorney. LawHawk is offering a package of a will and both EPA documents for $39.90, which is the cost of their will per our wills guide (so the EPA documents are effectively free). You may find an online solution, with its automation and guidance, faster and easier to complete your documents than using the MSD website.
  3. Whether you use the MSD or an online service, you will still need to visit a local lawyer or a trustee corporation (like Public Trust) to arrange the signing and witnessing. It is their job to make sure you understand what the EPA means, what it will do, and the responsibilities of your appointed attorney. The legal professional will also make sure it is valid under the law so it can be used if and when it's needed. Because you need to see a lawyer or a trustee corporation anyway, if the total costs are acceptable, you may choose to ask them to do the whole thing for you. 

​Warning: Make sure you are comfortable with your choice of attorney. In some instances, a person volunteers because it means they will have access to the donor's money. Make sure your family is comfortable with the choice to avoid problems later on.

Enduring Power of Attorney - Frequently Asked Questions

​When should I set up an Enduring Power of Attorney?

  • As soon as possible (and while you are able to). With an EPA in place, you have someone you want who will look after your interests should the need arise.
  • If you leave it too late and your health deteriorates, you don't have anyone appointed to look after you. For a loved one to then get the same rights as those in an EPA, you and your loved ones will be dragged through the courts to prove you are “mentally incapable”.
  • This almost-always involves psychiatric tests, capacity tests and medical tests, which adds to an already very stressful situation.

​How old do I have to be to get an Enduring Power of Attorney?

  • The minimum age is 18. Children are prohibited by law as their parent or guardian will make any decision-making.
  • While young adults and even those middle-aged don't think they need an EPA, sudden changes in health or a pandemic can affect anyone. For this reason, getting an EPA in place avoids any stress later on should the need arise.

​Who can you name as the "attorney"?

  • You can select anyone, provided that they are over the age of 20, they are not bankrupt, and that they are not mentally incapable themselves. In most cases, you're likely to name your husband or wife for your both your Property EPA and Personal Care and Welfare EPA.
  • You can also appoint people who will act as attorneys, only if the first or second appointed attorney is unable to for some reason. For example, you may decide to appoint your spouse as your first attorney, and then your brother/sister if your spouse is unable to act.
  • If both of those people you may also decide to appoint your children to act as a further back-up if all of the other appointments fail. You can also appoint successive attorneys who will only act if your first appointed attorney is unable to.

​Can I make an EPA which requires my attorney to consult with other people before making a decision

Yes. You're entitled to include whatever you like as instructions for your attorney. This can include a request that your attorney consults with family members before deciding on your medical treatment. While your attorney named in the EPA has the decision-making power, your loved ones may appreciate being consulted in the process and it can be a useful protection.  Similarly, you can require that certain people be informed about decisions or provided other information on request, or at regular times.

​When is an Enduring Power of Attorney activated?

  • For a Property EPA, this can be activated at any time. Usually, it's a family member who raises an issue such as "Dad isn't coping with managing his finances". The EPA allows the attorney to manage the financial affairs, for example, pay bills and invest savings. It can also apply if you are unavailable for any reason, which could be travel or health related.  If someone needs to deal quickly with the bank or a landlord, they can do it under the EPA. 
  • For a Personal Care and Welfare EPA, again, it's usually a family member who comments "Mum isn't coping at home anymore", or "Dad is losing it". At this point, the process should be simple to activate an EPA, but in some cases it's not always so black or white. A doctor will need to determine be called to decide if the person has "mental capacity" or not, and if they do not, then the EPA can be activated.

I can't decide on who to select as my attorney, what should I do?

This is surprisingly common for anyone with anyone with a complex family situation. In such cases, it's best to look for someone you trust and knows you and your situation well, and will be able to make the decisions that are in your best interests. Sometimes, this can be a cousin or neighbour, rather than a son or daughter.

It's best to discuss your concerns with your legal representative before you make an EPA as they can advise on your specific situation.

​How much does an EPA cost?

  1. You can download and complete the forms yourself, for free, from the MSD website. But that is not an easy or recommended approach.  
  2. Another alternative, and our suggestion, is an online provider such as LawHawk, who offer combinations of online wills and enduring powers of attorney. LawHawk is offering a package of a will and both EPA documents for $39.90, which is the cost of their will per our wills guide (so the EPA documents are effectively free). You may find an online solution, with its automation and guidance, faster and easier to complete your documents than using the MSD website.
  3. Whether you use the MSD or an online service, you will still need to visit a local lawyer or a trustee corporation (like Public Trust) to arrange the signing and witnessing. It is their job to make sure you understand what the EPA means, what it will do, and the responsibilities of your appointed attorney. The legal professional will also make sure it is valid under the law so it can be used if and when it's needed. Because you need to see a lawyer or a trustee corporation anyway, if the total costs are acceptable, you may choose to ask them to do the whole thing for you. 
  4. Fees: Public Trust, as an example, charges a fixed-price for each EPA. You can also see a lawyer who may charge an hourly rate. If you make a will at the same time, you may be able to arrange a discount, but generally, fixed-price services offer more certainty around the total cost. Whoever you decide to go with, make sure you ask all the questions you have. If you're unsure of anything, there is no better person to ask than a professional who is experienced in EPAs.

​Warning: Make sure you are comfortable with your choice of attorney. In some instances, a person volunteers because it means they will have access to the donor's money. Make sure your family is comfortable with the choice to avoid problems later on.

How can an EPA be revoked?

There are several ways an EPA can be cancelled:
  1. You cancel the EPA while you still have mental capacity - you must notify the attorney you selected in writing, and it's best to get legal advice before you cancel, change or replace an EPA.
  2. When you die – the EPA is revoked, and the affairs of your estate are administered by the trustee of your will.
  3. If the Family Court revokes your EPA – this usually happens when a family member complains that the attorney you selected is not acting in your best interests and/or has failed to undertake their responsibilities.
  4. If the attorney you appointed dies, loses their mental capacity or becomes bankrupt – the Family Court will then consider appointing a replacement.
  5. The attorney terminates their role – this happens when the attorney you appointed decides, for whatever reason, they no longer wish to act as your attorney.

What happens if my property, and personal care and welfare need looking after but I don't have an EPA?

  • This is, sadly, quite common in New Zealand. If you don't have an EPA and don't have the mental capacity to make one, your loved ones won't be able to act on your behalf.
  • This means they can't make medical decisions or access your money to benefit your care and welfare.
  • To make an application for a manager (someone who will act with your best interests in mind), families find themselves at the mercy of courts, lawyers and doctors.
  • The process involves lots of fees, and worst of all, takes a lot of time to co-ordinate. It's not unusual for the process to take a couple of months and cost a few thousand dollars.
  • If there are disputes within the family, things can seriously go off-track, and delays can last months. This appointment must be reviewed every three years, per the terms of the order. In some cases it will be five years, but largely, it is three years. 
  • Additional paperwork, such as annual accounts, need to be filed every year.
  • Having an EPA in place costs a fraction of the court process and eliminates a large amount of stress and uncertainty at what can be a stressful time for families as they assist with getting their loved one into care, or ensuring that they have all of their bills paid.

What happens if my family can't afford the court costs?

  • It's best to answer this by pointing out a recent example from North and South Magazine.
  • In this case, an elderly woman fell outside her home after suffering from moderate dementia. There wasn't an EPA in place, so the family was told by the hospital to apply for court orders to make them a manager of her property.
  • The family failed to do so, perhaps turned off by the upfront costs (up to $5,000). The hospital then applied to the Family Court to appoint a manager, meaning the family would be prohibited by law from managing her property.
  • All of this could have been avoided by having an EPA in place. The EPA would have been activated when the woman was in the hospital when a doctor certified she lacked mental capacity.
Important: While every effort has been made to ensure this article's accuracy, it does not constitute legal advice in any form. If you act on it, you do so at your own risk. We don't accept any liability for damage or loss, which may arise as a result of your reliance upon it.
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