by Mirit Hoffman, Adv., TEP, March 2020
The latest statistics indicate that there is a consistent increase in life expectancy and today it is over the age of 80. Unfortunately, the risk of Dementia and Alzheimer increases sharply with age and are not necessarily easy to diagnose, especially at their early stages. Consequently, although we might live longer, that doesn’t necessarily mean that our quality of life stays the same throughout our lifetime.
Israeli law has recently changed the way it deals with the elderly and incapacitated by empowering them with a legal option that enables them to decide how they would like their medical, financial and personal affairs to be handled once they do not have the mental capacity to do so themselves. An Enduring Power of Attorney form (EPA), is one of these legal options.
What is an EPA?
The EPA allows a competent person (the appointer) to appoint another person (the appointee, usually a family member or a close friend), to attend to his affairs while the appointer is still alive but no longer in a position to do so himself, without the need to apply to court to do so. Anyone who is competent and at least 18 years old can sign on an EPA. If there is any doubt regarding his mental eligibility, a medical document must be attached to the EPA, indicating the cognitive condition of the appointer. In addition to appointing someone, the appointer can also prepare clear instructions on how he wants his affairs to be handled. This is important as it helps family members know how to act on behalf of the appointer,without having to guess or make assumptions,
It is also important to note that the appointer can appoint more than one appointee to act jointly on any decisions, and the appointer can appoint a separate appointee for each matter (for example one to handle financial matters while another handles personal matters). In addition, it is recommended to appoint a successor appointee, in the event that the former cannot continue to act as the appointee for various reasons.
What matters can an EPA attend to?
The EPA covers three main areas- personal, medical, and financial.
Personal matters can include, for example, instructions regarding where the appointer would prefer to live when he is no longer competent, including an option to be transferred to a retirement home of his choice or to stay at home and receive assistance. Medical matters include what medical treatments the appointer would agree to receive. Financial matters can include for example various financial and banking issues, gifting money to various family members on various occasions, dealing with house bills, etc.
Certain matters require an express authorization from the appointer in the EPA and further matters can only be dealt with upon approval of the Israeli courts regardless of what is written in the EPA.
When does an EPA come into effect?
In contract to guardianship, where the courts are the one to decide when such an appointment comes into effect, in the EPA mechanism, the appointer himself, is the one to decide when the EPA comes into effect (for example upon the decision of a family doctor, or upon determination of a medical opinion prepared by a psycho-geriatric).
Upon the death of the appointer, the EPA terminates and consequently further dealings with the appointer’s assets will need to be dealt with according to his will or according to Israeli inheritance rules.
How is the EPA submitted?
The EPA needs to be drawn up and signed before a lawyer who has completed a special program conducted by the Israel Bar Association in order to qualify, advise, prepare, and file the EPA.
The lawyer drawing up the EPA is prohibited to be the appointee or nominated as the one being notified of the EPA coming into effect. This is in order to ensure that there will be no conflict of interest in the future.
After the EPA has been signed by the appointer the appointee, and the lawyer, it is filed online. In addition, the originally signed form must be deposited (either by the lawyer who filed the EPA, or by the appointer himself), with the Administrator General.
The EPA can remain irrelevant for 5/10/20 years, and in a way, it is similar to a will, which is also a document that is prepared ahead of time (but only becomes relevant upon death). Just like a will, as long as it does not come into effect, the EPA can be changed at any time.
Conclusion
An EPA is an effective tool with which you can plan your own future for when you are no longer able to make decisions on your own. This will enable you to continue living your life in the same manner as you have done up until now.
As opposed to a will which is a tool used in order to financially take care of your family upon your death, the EPA is a tool one you prepare in advance in order to best take care of yourself. Therefore, this tool is no less important than a will, and it should be considered seriously when thinking about planning ahead.
The content of this article is intended to provide a general guide to the subject matter and is not a substitute for legal consultation. Specific legal advice should be sought in accordance with the particular circumstances.
Mirit Hoffman, a qualified Israeli attorney and a registered trust and estate practitioner (TEP), is of counsel at Dave Wolf & Co. Law Firm and deals mainly with wealth and estate planning (wills, trusts and EPA’s), and individual US & Israeli taxation. She can be reached either by email at mirit@lawfirmwolf.com or by phone at 052-2407-999.