127 Some older people, particularly those with advanced dementia or significant cognitive impairment, may need help to make decisions about their lives—for example, where to live, how to pay their bills and manage their finances, and when to seek medical care. Often this help is given informally, by family and friends. But there are also a number of legal arrangements designed, in part, to support people to make decisions when they need it. Formal appointed decision-makers include guardians, administrators and people acting under a power of attorney. Where the decisions are about medical, health care or lifestyle matters they are often described as ‘advance care directives’.
128 Some of these arrangements are made by individuals themselves (eg, powers of attorney and advance care directives); other appointments are made by a court or tribunal (guardians, administrators). Sometimes the person appointed to a decision-making role will be a friend or family member of the principal; other times a lawyer, accountant, guardian or other professional unrelated to the principal may be appointed.
129 While these arrangements are often necessary and have many benefits, they are also open to abuse. For example, an appointed decision-maker may take advantage of their legal powers and position of trust for personal benefit. They may even steal from the principal, or use the principal’s home as security for a personal loan.
130 This section focuses on powers of attorney, guardians and financial administrators. There is also consideration of decision-makers appointed for health, medical and lifestyle matters. Appointed decision-makers under aged care and social security law are considered separately earlier in this Issues Paper.
131 Depriving people of their right to make decisions for themselves may in some circumstances also amount to elder abuse, or create a risk of elder abuse. The ALRC’s 2014 report, Equality, Capacity and Disability in Commonwealth Laws, was about ensuring people with disability have such a right—about respecting people’s dignity, autonomy and independence, while supporting them to make their own decisions, where such support is needed. The report was based on a model of supported decision-making, with the positions of ‘supporter’ and ‘representative’ incorporated in a Commonwealth model. Importantly, the report recommended a shift away from decision-making arrangements based upon the ‘best interests’ of a person towards one in which a person’s will and preferences direct decisions that affect their life.
132 Many of the findings in the ALRC’s 2014 report about disability will be relevant to older people with impaired decision-making ability. The findings in that report will therefore inform this Inquiry.
Powers of attorney
133 Powers of attorney may present a risk of financial abuse by an appointed decision-maker, in part because many ‘attorneys’ are untrained and sometimes do not properly understand their responsibilities.
134 Enduring power of attorney instruments carry a particular risk of abuse. Unlike other power of attorney instruments and unlike traditional agency relationships, enduring powers of attorney may continue to operate—or sometimes only begin to operate—when the principal loses the ability to make decisions. There is therefore a risk that an older person will be mistakenly declared or be mistakenly regarded to have lost capacity. Where this is somehow arranged intentionally and dishonestly, it may amount to abuse.
135 Powers of attorney are regulated by state and territory laws, governing the appointment and powers and duties of the attorney. They also provide for various safeguards, such as offences or remedies when a person acts beyond the scope of their power.
Appointed decision-makers for health, medical and lifestyle decisions
136 A person may make planning instruments relating to health, medical and lifestyle decisions. These instruments allow a person to plan ahead by providing what a person may want in certain situations and to authorise another person to make such decisions on their behalf. They are used in all states and territories but take different forms and have different names. For example, in South Australia, an ‘advanced care directive’ allows a person to record their wishes, preferences and instructions for future health care, end of life, living arrangements and personal matters, and to appoint a decision-maker to make these decisions when they are unable to do so themselves. In New South Wales, a combination of instruments may be used—an ‘enduring guardianship’ to appoint a decision-maker for decisions relating to living arrangements, health care or personal services, and an ‘advance care directive’ to record instructions about future medical treatment. In 2011, the Australian Health Ministers’ Advisory Council (AHMAC) suggested that the term ‘advance care directive’ be adopted to describe the range of instruments in which a person can record future preferences and appoint another person to make decisions on their behalf.
Some options for reform
137 A number of reforms to state and territory power of attorney laws have been suggested to reduce and remedy elder abuse by appointed attorneys. For example, some have suggested that a register of decision-maker instruments—perhaps even a national register—should be created. Registration of the instruments could be made compulsory. This might prevent people from trying to act under false instruments or instruments that have expired or been revoked.
138 Some have called for uniform state and territory laws governing powers of attorney, although this may be for reasons other than reducing elder abuse. Uniform laws might make it easier for banks and other financial institutions operating throughout Australia to train staff to detect the misuse of powers of attorney. The AHMAC has similarly recognised the need for a standardised national format and approach for advance care directives.
139 Compulsory training for attorneys has also been suggested. Training might particularly benefit those attorneys who do not fully understand their powers and responsibilities. It might also be a vehicle for warning attorneys of the legal consequences of the misuse of powers of attorney. Other mechanisms to this end might include requiring potential attorneys to sign a declaration stating that they will comply with their responsibilities and duties and not abuse their position of trust. Some jurisdictions already have such requirements.
140 The introduction of new offences for dishonestly obtaining or misusing a power of attorney instrument have also been suggested, and introduced in some jurisdictions.
Danger of too many safeguards?
141 Introducing additional safeguards for power of attorney arrangements may deter some people from appointing or acting as an attorney. The responsibilities may be considered too onerous or the penalties for misuse too great. The risk of harm to an older person from not appointing an attorney may need to be weighed against the risk of harm caused by the misuse of powers of attorney.
142 Importantly, a power of attorney allows people to choose for themselves who can make decisions for them and act on their behalf. This is generally considered preferable to courts or tribunals deciding who might make decisions for a person, because it gives greater control to the principal and better respects their autonomy.
A greater role in preventing abuse
143 This section has considered the risk of attorneys committing elder abuse, but attorneys may play an important role in safeguarding against abuse committed by other people against the principal. Should this role be expanded, perhaps by placing upon attorneys additional statutory duties to take steps to prevent abuse, in some circumstances?
Question 29 What evidence is there of elder abuse committed by people acting as appointed decision-makers under instruments such as powers of attorney? How might this type of abuse be prevented and redressed?
Question 30 Should powers of attorney and other decision-making instruments be required to be registered to improve safeguards against elder abuse? If so, who should host and manage the register?
Question 31 Should the statutory duties of attorneys and other appointed decision-makers be expanded to give them a greater role in protecting older people from abuse by others?
Guardianship and administration
144 A guardian is a person appointed by a tribunal (for example, the NSW Civil and Administrative Tribunal) or a court to make lifestyle or personal decisions for a person. An administrator is a person appointed by a court or tribunal to make financial and some legal decisions for a person. The criteria for granting guardianship and administration are similar in each state and territory.
145 A person appointed as a guardian or administrator may be a public guardian (for example, a public advocate or delegate), public administrator (for example, a public trustee or delegate) or a private guardian or administrator (for example, a relative or friend). The same person often performs both roles.
146 Guardians and administrators have statutory duties, including to exercise their powers in the way that is least restrictive of a person’s freedom of decision, in the ‘best interests’ of the person represented and taking account of the wishes of that person.
147 Guardianship and administration are derived from the concept of parens patriae, and are intended to be protective of the interests of vulnerable people—including those vulnerable because of age-related decision-making impairment.
148 Older people constitute a significant proportion of those for whom guardianship and administration orders have been made. One standard response to elder abuse where the victim has a significant cognitive impairment is to remove decision-making authority and appoint a substitute decision-maker. However, guardianship and administration may be a problematic response to elder abuse, by focusing on the agency of the victim, rather than dealing with the conduct of those perpetrating abuse.
149 Guardianship and administration also have the potential to facilitate elder abuse, if decisions are not made in the best interests of persons represented. This may be more likely to occur where there is a private guardian or administrator.
150 A broader concern is that current guardianship and administration laws do not adequately respect human rights and, in particular, the equal recognition before the law of people with disabilities, a matter considered in Equality, Capacity and Disability in Commonwealth Laws.
Safeguards and protections
151 Guardianship laws contain a range of accountability mechanisms that seek to ensure decision-makers exercise their powers appropriately. Tribunals have responsibility for overseeing the activities of decision-makers by reviewing guardianship and administration orders, assisted by Public Advocates or Public Guardians.
152 Guardians and administrators may be subject to regular tribunal reassessments of their appointments. Administrators are usually required to lodge a financial statement and plan, detailing how the represented person’s estate will be managed. Public guardians or administrators are also accountable for their activities to their employers.
153 Commentators have suggested additional accountability mechanisms, particularly for private guardians and administrators. These include mandatory training and education, periodic reporting, statutory declarations of compliance and auditing of decisions.
154 However, the need to balance protection and autonomy means that accountability mechanisms should not be so onerous as to discourage people from accepting decision-making responsibilities. Guardianship tribunals and offices may also need new powers and associated resources to monitor compliance.
Question 32 What evidence is there of elder abuse by guardians and administrators? How might this type of abuse be prevented and redressed?