Asset Protection

POWERS OF ATTORNEY

An Enduring Power of Attorney (EPA) is an individual responsible for ensuring the protection of your personal care and welfare in the event you are personally unable to do so.  If you lose mental capacity an EPA will be able to act on your behalf for dealing with your everyday matters.  If necessary, your Enduring Power of Attorney will have the power to complete financial transactions and sign documents on your behalf.  There are two types of Enduring Power of Attorney in New Zealand, an EPA specific to your property and an EPA specific to your personal care and welfare. 

A property EPA will be primarily responsible for managing any financial transactions which involve your property.  Household maintenance, expenses, buying or selling property, relocation and paying bills are all matters a property EPA can take care of. 

A personal care and welfare EPA will be responsible for making decisions related to your medical care and long-term health and wellbeing where you cannot make the decision yourself. 

You may wish to have more than one person appointed and acting as your EPA.  At times EPA’s can encounter problems of their own, such as dispute in direction of care.  The Protection of Personal and Property Rights Act can protect individuals who appoint an EPA from being victim to misuse of EPA powers.  To ensure your EPA or EPA’s are appointed legally and to minimise the risk of future EPA dispute’s relating to your ongoing care, you should seek legal guidance on this process.  

Also, if you have concerns that a loved one is being taken advantage of during their time of impairment then seek advice immediately. There are a number of remedies available in these circumstances, sometimes requiring court intervention. If, for some reason, an impaired person has not made provision in event of impairment, this may necessitate an application to the Family Court under the Protection of Personal Property Rights legislation. Again, we are here to help provide advice on the steps that need to be taken. 

ESTATE PLANNING, WILLS

Most will use a will as a living document after their passing to ensure their estate/assets are distributed in accordance with the law and their wishes.  

The preparation of a Will is necessary if you have children who require care, if you have financial wealth you would like to distribute to loved ones or donate to charity, or if you have specific instructions for your funeral.  The list can go on of what final wishes can be included in a will.    

Should your passing be sudden, and no Will has been prepared, your family will be required to make all arrangements for your estate/assets.  This could mean your estate/assets may not necessarily be distributed to your desired beneficiary/’s (e.g. your partner), the Government could divide your assets on your behalf, or your children could be cared for by family who you have not nominated to do so.

We can assist with the drafting of your Will, to ensure your loved ones are taken care of after you pass.  We can provide advice on whether a Trust is needed to be established after your passing to further protect your Estate/assets and beneficiaries.  

PROBATE & ESTATE ADMINISTRATION

Probate is the legal process which happens after you pass.  A Probate is a legal document issued by the High Court, allowing an executor of your Will to action the instructions you have had recorded in your Will.  Once Probate has been granted by the High Court the executor of your Will, who is then a Trustee of your estate can begin to distribute your estate in accordance with your wishes. Frequently, this will require the assistance of a legal professional to assist your Trustee’s to administer your estate.

The Trustee/s can choose if they wish to administer the estate outlined in the will or request a professional to administer the estate.  

Our recommendation is that you obtain advice now and make decisions for the benefit of your family and their peace of mind. We also recommend you review your Will frequently, every two years.  You may also wish to consider placing your assets into a Trust.   This will minimise what you own and reduce significantly the costs of estate administration application to the High Court for Probate may not be required.

If you do not have a Will, this process could become a burden for the remaining members of your family. This means you have died without a Will or otherwise intestate and your assets are then subject to administration under the provisions of the Administration Act 1969. This can be a costly procedure to undertake, depending upon the number of immediate family members you have.  Drafting a Will while you are alive will reduce this burden for your family and friends at a time when they should be celebrating your life.

People often think that getting a free Will at the office of the Public Trust would be easier than engaging a lawyer. Our recommendation is to enquire into the pros’ and cons’ of each option. What can seem as inexpensive or free now, could be more costly and/or frustrating for your family later. We can assist you with comprehensively outlining your options and providing you with insight into the best options tailored for your current life circumstances and help with future planning.

With regard to Trusts and Estate Planning the new Trusts Act comes into force in January 2021. The new Trusts Act will have a significant effect on asset and estate planning. If you have an existing Trust, or you are considering whether to set up a new Trust then it is imperative that you obtain advice on your future estate and asset planning. Call us to discuss this.

TRUSTS

On 31 January 2021, the Trusts Act 2019 comes into force. The Trusts Act 2019 is a significant overhaul of the existing Trust laws in this country and will impact most, if not all, of existing Trusts in this country.

The reasons for having an existing Trust or forming a new Trust change. The advice that lawyers currently provide for Trusts have changed. Costs associated with operating a Trust change and the potential for Trustee liability for not operating the Trust correctly change.

Creating a Trust can still be in your best interests and in the interests of your business.  Today, it is often confusing for people whether establishing a Trust is right for them.

A Trust is created by the owner of the assets/property (settlor) who transfers the assets/property to another trusted individual (trustee).  The trustee will then hold that property for the beneficiaries of the established trust.

The terms of the Trust is like the book of rules of a rugby game. It specifies the purpose and obligations of the Trust and the parties to a Trust. Understanding the rules is necessary to properly administer the Trust. Equally you must understand the risks with being a Trustee and what you can and cannot do. Obtaining the help of a professional Trustee Company is essential to minimising risk both to your assets and to the Trustees.

Talk to us about whether your existing Trust or a new Trust is right for you. The team at Bytalus Legal can advise you on the changes to Trusts and the effect of the new Trusts Act on you and your assets. Do not delay in getting this advice. What we do know is preparation is key to avoid breaches of the Trusts Act 2019 upon the start date of 31 January 2020.  The implications, if not handled appropriately can be wide-spread across all of your asset and estate planning.