A valid Will and a Power of Attorney should be part of your business plan, just like insurance policies and good credit management.
A will is a document that sets out your wishes for the distribution of your assets upon death. It can also make provision for the care of minor children, and in our particular case can make provision for the operation of your enterprise.
A Power of Attorney is a different thing. It generally directs another person to take control of your financial affairs while you are still alive (usually called an enduring power of attorney). Then there is a medical POA which allows another person to make decisions about your medical treatment.
Advanced Care Directives allow you to make, and to communicate, decisions in advance about palliative care, medical treatment and resuscitation. They are a relatively new innovation in their own right.
What are the requirements for a valid will?
These requirements are applicable in South Australia. There are subtle differences between States, and sometimes very great differences apply in other countries.
First, it must be in writing, and signed by the person, with the clear desire that it takes effect upon their death.
Secondly, it must be signed by two witnesses who are present when the will-maker (testator) signs the document.
Thirdly, the testator must understand what they are signing and agree with its contents.
Fourthly, the testator must have legal capacity. This means they are an adult (18 years or older) and have sufficient understanding of what the document is. A person with advanced dementia or some form of severe cognitive injury cannot make a will on their own behalf.
What sort of POA do I need?
Business people need to ensure that their businesses can keep operating even when they cannot. Imagine the confusion if you suffer an illness or incapacity that affects your capacity to make decisions, and YOU are the sole director of the company that operates the business, employs and pays the staff, leases the workshop and finances the equipment and operates the bank accounts.
A simple enduring POA, with appropriate references to corporate powers if needed, can alleviate all the worries in these cases. The holder of the power that you have chosen steps in and makes the business decisions. No arguments, no lawyers and most importantly as little interruption to the operations of the business as possible.
Be careful to distinguish between this type of power and a medical care directive. That is a separate matter, best dealt with by an Enduring Power of Guardianship or an Advanced Care Directive. They deal with personal and lifestyle decisions, rather than business and financial issues.
How does all this affect my business?
If the unthinkable happens, it allows other people nominated in advance by you to administer your business and to make the sort of decisions that they consider would be in keeping with your own wishes. Obviously they can’t consult with you-if they could, you’d be running the place yourself- but it is the closest you can come to controlling what happens when you are unable to do so. It also relieves stress and anxiety for everyone involved with the business, allowing as smooth a transition as possible.Contact the MTA’s Workplace Relations team by clicking here to enquire about how they can put you in contact with specialists in the above matters, or by calling 8291 2000.