GEOFF, aged 80, appoints his neighbour, Julie, to manage his financial affairs, under an enduring power of attorney. His wife passed away 15 years ago and he has no children.
Julie accepts her appointment as attorney and in doing so, declares that she will not “gain a benefit” and “always act in Geoff’s best interests”.
When Geoff moves into aged care, Julie spends $80,000 renovating his property.
Soon, Geoff loses his aged pension because the value of his assets is above the allowable limit, given that his property is no longer exempt from the assets test, as his residence.
Julie drafts a Granny Flat Agreement, transferring Geoff’s property to her, in exchange for a right for Geoff to reside in the property for life and to be cared for by Julie. Geoff remains in aged care and never returns home.
The property is subsequently transferred into Julie’s name and she rents out the property.
When Geoff’s niece becomes aware of the arrangements, she seeks a review of the power of attorney, raising serious concerns including elder abuse, coercion, manipulation and conflict of interest.
At the hearing, it comes to light that Geoff speaks and understands little English and that he stopped driving many years ago.
Julie produces bank statements, showing that the rental income had been paid to the aged-care facility, towards Jeff’s daily care costs and that she had contributed to $2000 a month to meet the shortfall.
Julie says that she had cared for Geoff for 20 years, prior to his admission into care. She says that Geoff had left her the property in his will.
The Tribunal finds that Geoff is extremely vulnerable and experiences memory issues.
However, the Tribunal finds that Geoff received independent legal advice regarding the transfer of the property, and although Julie drove Geoff to the appointment, she was not present during the consultation.
Ultimately, the Tribunal finds that Geoff was not subject to coercion or undue influence and that he validly transferred the property to Julie.
If you have a request for a Hypothetical, call Manny Wood on (02) 66 487 487 or email manny@tblaw.net.au.
This fictional column is not legal advice.
By Manny WOOD
You can help your local paper.
Make a small once-off, or (if you can) a regular donation.
We are an independent family owned business and our newspapers are free to collect and our news stories are free online.
Help support us into the future.
