14. Decision-making capacity for powers of attorney and other documents of similar nature

Justice of the Peace Handbook

Most powers of attorney and other appointments under Powers of Attorney Act 2014, the Medical Treatment Planning and Decisions Act 2016 and under the Mental Health Act 2014, require that witnesses to the appointments certify to the effect that the person making the appointment has decision-making capacity and freely and voluntarily signs the document.

This is a significant responsibility. It has arisen because powers of attorney and other documents of a similar nature have been used to deprive vulnerable people of their property. Unfortunately, it is often the people closest to them that have taken advantage of the power given to them by legal documents.

In the case of medical and mental health treatment appointments, it is obvious that the person who makes or supports a person needing treatment must be a person who can be trusted to observe the wishes of the person who appointed them at times when they are likely to be most vulnerable.

The Powers of Attorney Act 2014 contains a detailed explanation of what is meant by decision-making capacity under that Act.64 It states that a person is presumed to have decision making capacity unless there is evidence to the contrary.

A person has decision-making capacity if the person is able to:

  • understand the information relevant to the decision and the effect of the decision; and
  • retain that information to the extent necessary to make the decision; and
  • use or weigh that information as part of the process of making the decision; and
  • communicate the decision and the person's views and needs as to the decision in some way, including by speech, gestures, or other means.

It is important a person understands the nature and impact of their decision-making given the significance to their personal circumstances, including their finances. This can be communicated flexibly by modified language, visual aids, or any other means.

In determining whether or not a person has decision making capacity, you should consider:

  • a person may have decision making capacity for some matters and not others
  • if a person does not have decision making capacity for a matter, it may be temporary and not permanent
  • it should not be assumed that a person does not have decision making capacity for a matter on the basis of the person's appearance
  • it should not be assumed that a person does not have decision making capacity for a matter merely because the person makes a decision that is, in the opinion of others, unwise
  • a person has decision-making capacity for a matter if it is possible for the person to decide in the matter with practicable and appropriate support.

Examples of practicable and appropriate support set out in the Act include:

  • using information or formats tailored to the particular needs of a person
  • communicating or assisting a person to communicate his/her decision
  • giving a person additional time and discussing the matter with the person
  • using technology that alleviates the effects of a person’s disability.

A person may make or propose to make a decision that has a high risk of being seriously injurious to the person's health or wellbeing. In conjunction with other factors, this may be evidence that the person is unable to understand, use or weigh information relevant to the decision or the effect of the decision.

14.1 Assessing decision-making capacity

When making a certification that a person appears to have decision-making capacity or signs a document freely and voluntarily, you do not have to assume the role of a medical practitioner, psychologist, or psychiatrist. All that you must do is use your best judgement and apply any principles that are set out in the legislation relevant to the document you are witnessing.

Conversely, you must take reasonable steps to conduct the assessment at a time and in an environment in which the person’s decision-making capacity can be assessed most accurately.

14.2 Extra steps to assess capacity or free will

If you have doubts about decision-making capacity, here are some extra steps that will help you ascertain the person's understanding and free will.

14.2.1 See the person alone for part of the appointment

If another person accompanies the principal, ask this person to leave the room for part of the appointment.

Seeing the principal in private provides them an opportunity to speak with you freely. Explain to the principal that the conversation between you will remain confidential and that you will not repeat anything to the person accompanying the principal.

During this contact, it is reasonable to discuss background, family, health problems or related issues (such as medication that may affect cognitive function, the person’s broad financial circumstances including assets, source of income, payment of household and other accounts).

14.2.2 Check the person’s understanding and wishes

Once you have satisfied yourself that the principal can speak freely to you, find out whether they understand the document and want to sign voluntarily. Ask open-ended questions that cannot be answered with a simple ‘yes’ or ‘no’. Ask if they have read the document or had it read to them.

The following are examples of questions you may ask if you have some doubt about the person's capacity. You need to be tactful when choosing the questions because their only purpose is to verify that the person truly wants to sign the document and understands its contents and purpose. You should not ask why the person has decided to make the document or about the person’s family and health.

  • What does this document do?
  • What decisions can the person you are appointing make after the document is signed?
  • When can the person make these decisions?
  • What are the limits on decisions this person can make?
  • Can this person make the decisions for you when you are capable of making them yourself? If yes, ask:
    • Does the person have to consult you?
    • Can the person make a decision you agree with?
  • Can the person make decisions for you after you lose the legal capacity to make them yourself? If yes, ask:
    • Does the person have to check with anyone else?
    • Can the person make a decision that you would not make yourself, if you were able?
  • Can you change or revoke the terms of the document? If yes, ask:
    • When? (the principal should be able to provide information such as : ‘At any time I wish to, until I lose legal capacity, and, after that, it can only be changed with the approval of a court/guardianship board’)
  • Do you need anyone’s permission to change or revoke this document? (the answer should be ‘no’)
  • Has anyone put pressure on you to do this?

14.2.3 When an interpreter is involved

When the services of an interpreter are used it is important that you are satisfied that the form has been explained in a language that the principal understands. The person who is being appointed as an attorney for the principal cannot be the principal’s interpreter.


[64] Section 4, Powers of Attorney Act 2014