Essential steps to managing your family’s inheritance
How would you or your family cope? Regrettably, most families in Ireland have a family member who has suffered some form of mental illness. Unfortunately this may happen at any stage or age in life and often, there is very little warning before someone suffers a mental incapacity or a life-changing accident. It would make your everyday routine of paying bills, running a farm and making basic financial decisions impossible. If you become incapable of managing your affairs, it can be a very difficult time for you and your family. It would be particularly detrimental if you are the owner of a farming business. If someone becomes incapacitated through disability, illness or progressive degenerative disease, their assets become frozen. Bank accounts, farm entitlements, land and other assets that are in your sole name or joint names with a spouse could not easily be dealt with. From a financial and practical point of view, a person, while in good mental health, should create an Enduring Power of Attorney (EPA). This is a legal document which only takes effect in the event that the person becomes mentally incapacitated. This is an important point and one that is often misunderstood. The person creating the EPA is known as the Donor and in the event of his or her becoming incapacitated, power to deal with the Donor’s money and assets transfer to the Attorney. It becomes operative only if you become incapable of looking after your affairs and it continues in force until death. By planning ahead and making an EPA, you are able to give your instructions whilst you are of sound mind. In order to make an EPA, you must be mentally capable of doing so. Your Attorney’s can be people such as your spouse, partner, parent, sibling or friend. The choice of Attorney is a personal matter but a great deal of thought needs to be given to the nomination. Questions to ask are is this person suitable for the job, do I trust them and do they have the skills to manage my farming business and make decisions for me? This can be confined to personal care decisions, housing, running a farm, managing bank accounts and so on or it can encompass all. By executing an EPA you retain control over who has the responsibility of looking after your affairs. It is your choice. Do not give up your right to choose! Once somebody has become unable to manage their affairs, it is too late to make an EPA. If you have already made a Will, then an EPA will compliment this and help reassure both you and your family that you have made plans for the future. An EPA allows your Attorneys to manage your assets for your benefit while you are alive but mentally incapacitated. Your Will dictates what is to happen to your assets after your death. An EPA only takes effect if mental capacity is lost at a later date. It does not take effect once executed. You continue to manage your own affairs. What happens if you change your mind? The EPA can be revoked at any time before it is registered. If you change your mind about having an EPA or about your choice of Attorney, you should consult your solicitor immediately. If in the future your Attorney has reason to believe that you are becoming mentally incapable of managing your affairs, they must apply to have the EPA registered in the High Court. Before doing so, they must give notice to you of their intention to do so and to your two notice parties named on the EPA. You and your notice parties will be able to object if you or they disagree with the registration. In the event of you becoming mentally incapable without having this document in place, your family will not be able to deal with your financial affairs or your property until you die or you are made a Ward of Court. An Application to be made a Ward of Court is an extremely costly and time consuming process and could significantly erode your assets. Executing an EPA can represent enormous value for money compared with the cost of making someone a Ward of Court. The Court would have the ultimate authority and power to deal with your assets and affairs. Generally a committee will be appointed and they will act on behalf of the farmer under the authority of the Court. The committee may not necessarily comprise of people who the farmer would have appointed to look after his affairs if he or she had considered the matter whilst in the whole of their health.
