Estate planning is more than simply deciding who will inherit your assets – it’s also about carefully selecting the individuals who will be entrusted with critical responsibilities. From the Executors in your Will to Attorneys in an Enduring Power of Attorney, these roles hold significant power. Here, Attwood Marshall Lawyers’ Partner in Wills and Estates and Aged Care, Debbie Sage explains the difference between an Attorney and an Executor.
When it comes to planning for the future, many people mistakenly assume that the roles of an attorney under an Enduring Power of Attorney and an executor appointed in a Will are interchangeable. While both are crucial in managing your affairs, these two roles are governed by entirely different legal documents and come with distinct responsibilities.
Here, we will explain the key differences between an attorney and an executor, and what to consider when selecting someone to appoint to these roles.
What is an Executor?
An executor is the person, or persons, appointed in a Will to carry out the wishes of the deceased after they pass away. You can appoint one person, or multiple individuals (up to four people), or an organisation to this role.
Their primary duties are to:
- Make funeral arrangements
- Arrange body disposal (burial or cremation)
- Investigate, identify and call in the estate assets
- Apply for a grant of probate or administration (if required)
- Secure the estate assets
- Settle any outstanding debts
- Keep full accounts of the estate
- Carry out the deceased’s wishes as specified in their Will and according to law.
Executors have a legal duty to act in the best interests of the estate and the beneficiaries throughout the estate administration process.
When choosing an executor, you need to select an individual, or persons, who can communicate effectively with all beneficiaries. In some instances, this can involve wearing a mediator’s hat, managing the emotions of all parties involved in a gentle yet firm manner, and if required, having the backbone to stand up to protect the deceased’s wishes if disputes arise.
The role of executor is quite onerous and not all people will be up to the task. If there are complex family dynamics to consider, and suspicion that someone may contest the Will or challenge the decisions being made by the executor, then it can be beneficial to appoint an independent third party to ensure disputes are mitigated and there will be little to no disruption to the estate administration process.
Choosing an unsuitable person to be your executor often results in messy and drawn-out consequences for your beneficiaries and your estate.
Read more: Common misconceptions about the role of an executor in a Will
Read more: When executors fall short: how to remove an incompetent executor
What is an Attorney?
Planning for your future healthcare and financial needs should you lose capacity while you are still alive, is just as important, if not more important as managing your assets after death.
This is achieved by appointing an attorney under an Enduring Power of Attorney (EPOA).
In Queensland, the EPOA document allows for two main types of decision-making powers: personal/health decisions and financial decisions. You can appoint one or more attorneys to manage these areas separately, ensuring they can make choices on your behalf about your medical care, lifestyle, and finances depending on the terms of the document.
If appointing more than one person to the role, you can appoint your attorneys to act jointly, severally, or by majority. Whatever you decide, you must ensure that it is a workable arrangement and that your attorneys are going to be able to work together to protect your best interests.
In New South Wales, the system is slightly different. The appointment of an attorney for financial matters is done through an Enduring Power of Attorney document, while health and personal decisions are covered by a document called an Appointment of Enduring Guardian (AOEG).
Understanding these differences is critical to ensuring your affairs are managed according to your wishes, depending on the state in which you reside.
Many people underestimate how complex these documents can be to complete. It’s common for individuals to download an Enduring Power of Attorney form from the internet and fill it out without obtaining legal advice. However, without proper guidance, you may fail to fully reflect your intentions or grant the correct authority to the individuals you’ve chosen as attorneys.
This could lead to insufficient safeguards for holding your attorneys accountable, increasing the risk of financial or elder abuse, or limit your attorney’s ability to make important decisions or transactions that would otherwise require tailored clauses to authorise.
Although there is different power of attorney forms for each state in Australia, many Australian states and territories accept each other’s Powers of Attorney, with some exceptions.
If you do not have an Enduring Power of Attorney or Appointment of Enduring Guardian and something unexpected happens and you lose capacity to make decisions for yourself (whether temporarily or permanently), your loved ones will not have the authority to be able to immediately access your bank accounts, pay your bills, take over your business affairs, or make medical decisions for you.
In this case, your loved ones would need to apply to the Queensland Civil and Administrative Tribunal (QCAT) or New South Wales Civil and Administrative Tribunal (NCAT) to be appointed as your financial manager and/or guardian. This can be a lengthy and stressful process, which means in the meantime, no one is able to act immediately for you while you are incapacitated.
Choosing your Executor or Attorney
Both the roles of Attorney and Executor are crucial, requiring a significant amount of time, energy, and competence to perform effectively. While many people choose their adult children or spouse for these positions, there is much more to consider than simply who is next of kin.
For an executor, choose someone responsible and trustworthy. Ensure that your chosen executor fully understands the legal and financial duties involved, including applying for probate, settling debts, and distributing assets.
It’s also important to confirm that the person you appoint is willing to take on these responsibilities, especially when complex tasks, such as defending your estate if someone contests your Will, are involved.
Ideally, your executor should reside in the same region as your estate to facilitate smoother management.
As for your attorney, this person must possess good judgment, financial competence, and a commitment to acting in your best interests. You need to trust them implicitly to involve you in decision-making where possible and to ensure your wishes are upheld.
It’s also beneficial if they live close to you, so they are available and accessible when needed.
Read more: World Elder Abuse Awareness Day 2024 – a timely reminder to have an enduring power of attorney
Read more: Is your mate from the pub up to the task to act as your Enduring Power of Attorney?
Attwood Marshall Lawyers – Helping you plan for the future and preserve your wishes
Not everyone has someone in their life they can trust to manage their decisions or estate in the event they lose capacity or pass away. Even when you do, family dynamics can sometimes complicate matters – especially when children, parents, or siblings struggle to get along or make decisions that align with your best interests.
To address these concerns many people face, Attwood Marshall Lawyers offers professional services to act as your attorney under an Enduring Power of Attorney, ensuring that your bests interests are protected and that decision-making power is handled with care and accountability.
We also provide executor services, helping to safeguard your legacy and ensure a seamless transfer of assets to your beneficiaries, free from conflict and confusion.
If you need assistance drafting a Will, Enduring Power of Attorney, or want to find out more about our Attorney Services and Executor Services, please contact our Wills and Estates Department Manager, Donna Tolley, on direct line 07 5506 8241, email dtolley@attwoodmarshall.com.au or free call 1800 621 071 any time.
Our Wills and Estates Lawyers are available for appointments at all our conveniently located offices at Coolangatta, Southport, Robina, Kingscliff, Sydney, and Melbourne.
