Wills and Enduring Power of Attorney documents are among the most important legal documents, but are often overlooked.  Everyone from as young as eighteen should have these documents for the reasons set out below.

Wills

Why is a Will important
A Will sets out a person’s wishes after they die and appoints a person or persons called executors to be legally responsible for carrying out these wishes.  It often comes as a surprise to New Zealanders that if you do not leave a Will recording how you would like your assets to be distributed, then the Administration Act 1969 (“the Act”) will decide for you.

What happens if you die without a Will
Someone (generally a family member) then must apply for Letters of Administration if the estate is valued over $15,000 and ask to be the administrator of the estate.  This process can be more costly in comparison to that involved when the deceased has left a valid Will.

The application is made to the High Court and can take some time to be processed. The administrator then has full authority to distribute the assets in accordance with the Act which dictates who is to receive the deceased’s personal chattels and balance of assets.  The Act’s order of priority may not align with your wishes.  By way of example, in the case of a surviving spouse and children:

• the spouse receives:
  • All of the deceased’s personal belongings.
  • A set dollar amount which is currently $155,000, plus one-third of the rest of the deceased’s estate (i.e. home, KiwiSaver, personal bank account balances).
• The children receive the other two-thirds of the deceased’s estate in equal shares.

Matters to consider
If you do not have a Will or have not updated your Will for some time, you should consider the following:

• Who would I trust to be responsible for my assets when I pass?
• Who do I want to ensure is looked after when I pass?
• Do I have any special items that I want to give to particular people?
• Do I want to set up a Trust when I pass or gift money or property to an existing Trust?
• Do I want to support a charity or community organisation?
• What is to happen with my Māori Land interests?
• Who will look after my infant children when I pass?
• What funeral arrangements would I prefer?

Enduring Power of Attorney

What is an Enduring Power of Attorney
Enduring Power of Attorney (“EPA”) documents are equally as important as Wills.  They protect you and your family in the event that you lose mental capacity (which could be as a result of an accident or medical condition).  These documents authorise particular persons to step in and manage your affairs during your lifetime.

There are two types of EPA:

• EPA in respect to property – Management of your personal finances and property.
• EPA in respect to personal care & welfare – Decisions round wellbeing including where you live and how you will be cared for.

You require two documents (one for each type of EPA) in order to cover all circumstances.

What happens if you lose mental capacity without having EPA documents in place
In the absence of EPAs, your loved ones would be faced with having to apply to the Family Court for the appointment of a property manager and welfare guardian.  This can be a lengthy and costly process for loved ones who are already in a stressful situation.

Matters to consider

• Who do I trust to make decisions in respect to my wellbeing?
• Who do I trust to manage my personal finances and assets?
• Who do I wish to appoint as a back-up attorney?
• Do I want my attorney to consult another person or persons?
• Do I want my attorney to provide another person or persons with information?
• Do I want to impose any conditions?

Next Steps
Holland Beckett Law can assist with all of your estate planning needs.  There is no time like the present, so please reach out to get your estate planning underway.

Brittany Ivil
Associate
07 928 7098
Brittany.Ivil@hobec.co.nz

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