Protection of Personal and Property Rights Amendment Bill

It is my privilege to be able to speak tonight to this Protection of Personal and Property Rights Amendment Bill in the Committee stage. In particular I would like to point to clause 18, which affects section 103 of the principal Act in relation to the ability of people to apply to the court “to review any decision made by an attorney acting under an enduring power of attorney while the donor is or was mentally incapable:”.

This is an extremely important provision. I say that because there have been instances—as my colleague Katrina Shanks has so ably pointed out—of people who have misused a power of attorney to benefit themselves, others, or their own families to the detriment of an elderly relative. In particular, it is quite distressing for people to see that sometimes the most unkind people in these situations can be one’s own children. I think that many of us hope that our children do not do the same to us as others have. I think it is important to note that the donor—and this bill does accept the fact that donors can sometimes lose and then regain mental capacity—can ask for decisions to be reviewed. Other people who may apply for any decision to be reviewed are: any relative or attorney of the donor who is not the particular attorney who has made the decision; a social worker; a medical practitioner; a trustee corporation; the manager of a residence in which the donor is a patient; and any welfare guardian.

So there are ample opportunities for those people who see, or think that they see, an abuse of a power of attorney being undertaken to do something about it. It is really important to have that standing, and one of the best things about this particular part of the bill is that it allows that. Many of us will have worked with people from Age Concern and with other people who are involved in the area of preventing elder abuse, and these people have said that that provision is particularly important. That is why the Social Services Committee inserted subsection (h) in section 103, to allow for “a person authorised by a body or organisation contracted by the Government to provide elder abuse and neglect prevention services” to also apply for the decision to be reviewed. So there is ample opportunity to review a decision.

Hopefully, people will never need to apply for a review. Hopefully, the message will get out there that the enduring powers of attorney, which were set up to help people whose health—in particular, mental health—had declined, often in their advanced years, will not be able to be misused again. Obviously, some people will try, but at least we now have a mechanism—a very good mechanism, I believe—for people to be able to deal with that.

In conclusion I say that I am very pleased with this bill. I think that Part 2 is a good part. It is the main part of the bill, it is sensible law, and it is one that I think everybody on the select committee was able to agree with and be proud to be part of.

I first of all add my thanks to that already given to the officials, who have worked so hard and constructively with the Social Services Committee on this bill. I also repeat the comments I made in my second reading speech and thank the select committee. It is not well known amongst the public of New Zealand that policy differences are often put aside during the select committee process for the betterment of bills, and this has certainly been an example of that. So I acknowledge all of the members of the select committee, rather than just those of my own party, which I do not think is very appropriate to do at a time like this.

I also want to address Supplementary Order Paper 145 in my name, which proposes a number of changes that I draw to the attention of the Committee. It starts off with changes to clauses 7 and 8. These are technical changes that clarify the relationship between new section 94(A), which specifies the requirements for creating an enduring power of attorney, and section 95 of the principal Act, which sets out when a power of attorney is an enduring power of attorney. That is the first change set out on my Supplementary Order Paper.

The next change replaces subsection (1) of new section 94A with a new subsection that provides that section 94A applies only to powers of attorney executed after the bill comes into force. That clarification is obviously needed. It inserts new section 95(1) to provide that: “Except as otherwise provided in this section, a power of attorney that meets the requirements of section 94A is an enduring power of attorney.” So they are points of clarification.

The next change proposed in my Supplementary Order Paper is to clause 15. It basically corrects an earlier oversight in new section 100A, which, as the explanatory note of the Supplementary Order Paper states: “enables a donor of an enduring power of attorney who has been, but is no longer, mentally incapable to suspend the attorney’s authority to act under the power.” This amendment ensures that the court’s determination of the donor’s mental incapacity, if any, is taken into account for the purposes of this new section.

The next clause that is amended by my Supplementary Order Paper is clause 16. That is a technical amendment; it just removes an incorrect section reference from the principal Act, so I am sure there will not be a lot of debate about that.

Then the next amendment is to clause 18—the part of Part 2 that the member who has just resumed her seat, Judith Collins, spoke to. The proposed amendments to this clause relate mainly to new section 103A. It is amended to provide consistency of wording as a consequence of the changes I referred to in clauses 7 and 8. It also corrects a minor drafting error so that we have terminology that is consistent, and I know that members in this Chamber will be particularly interested in that consistency.

The next changes, which are the final ones in this Supplementary Order Paper, are to clauses 21 and 24. They are further technical amendments that correct minor drafting errors for consistency of terminology by replacing “made” with “executed”. I am sure the Supplementary Order Paper will continue to be well supported by parties in the Chamber. It is a pleasure to be able to progress with strong support legislation whose primary purpose is to give better financial protection and to ensure that the persons’ interests are carried through when they are no longer able to make decisions for themselves.

We now know that the most vulnerable people in our society, who are dependent on some other trusted person to make a decision for them, will have much stronger backing from the law to make sure that that trust is not abused. Sadly for us all, that trust is abused by members of families. In fact, that is the biggest concern in terms of elder abuse and neglect that is referred to the services that our Government funds throughout the country. Perhaps it is the one that is the most reported, but it is certainly one that we are taking big steps to address in this legislation, so I urge its speedy progress throughout the Committee stage.

I am grateful for the opportunity to speak on Part 2 of this Protection of Personal and Property Rights Amendment Bill. It is good to see the Minister in charge of the bill, Ruth Dyson, in the chair, and I hope that at some stage of events she will answer the question that has been on my mind for quite some time: given that the commission’s report was in 2001, why has it taken so long for the Labour Government to finally bring this legislation to the House? Her Majesty’s most loyal Opposition is supporting this bill—we believe that it is sensible—but we are concerned that the Labour Government has prioritised other things, and, indeed, that it has taken it so long to bring in something sensible. Perhaps the Minister will tell us why it has taken so long.

I would like to start off by commenting on new section 93B, “Presumption of competence”, inserted by clause 6. I make the point here that new subsection (4) states: “A person must not be presumed to lack the competence … or, as the case may be, the capacity described in subsection (1)(b), just because the person is subject to compulsory treatment or has special patient status under the Mental Health (Compulsory Assessment and Treatment) Act 1992.” I am sure the Minister would agree it is absolutely appropriate that that is clearly spelt out.

We go on to creating the enduring power of attorney. I was very pleased to see that some of the constructive submitters caused a change to be made to the bill, in terms of witnesses to the signature of the donor. It will be possible for not only a lawyer, or an officer or employee of a trustee corporation, but also a legal executive who meets the requirements of new section 94A(9), inserted by clause 7, to witness a signature. I must say that the New Zealand Institute of Legal Executives made an excellent submission. It pointed out the range of things that legal executives do, and that they currently undertake this work anyway—both large and small drafting. It mentioned an informal email survey of its members that had something like a 76 percent response rate, and that these executives are regarded as highly competent in their explanations to their donor clients. Much to my surprise, on average legal executives are doing this two or three times a week—up to 200 times a year. The institute had very strong support from both the Law Society and Chapman Tripp in its submission, so it is very pleasing to see that, indeed, the institute’s submission has been taken notice of and that provision is within the bill.

Finally I want to comment on one of the Minister’s amendments in clause 15. I agree that we should support the point made in new section 100A(1), which states: “A donor of an enduring power of attorney who has been, but is no longer, mentally incapable may suspend the attorney’s authority to act under the enduring power of attorney …”. It is absolutely vital to have that correct. It would have been an awful anomaly if it were not, so National will be supporting that very, very cogent issue.

It is with pleasure that I have spoken on this bill. National will support it as we go on in the debate.

It is my pleasure to follow the previous speaker, Paul Hutchison, who wobbled around the point until he thought of something to say, which was very typical of his contribution in the select committee process too. His concern was mostly with the pineapple slices on the table, instead of getting to the meat of the subject.

I was delighted to hear the Minister Ruth Dyson say that great camaraderie had broken out in the select committee. That may well be an exterior witness’s viewpoint of it, but I have to say it was an enjoyable select committee for only two reasons: one, because of Michelle Malyon, who left the committee today to go to richer pastures and who will be a loss to the Clerk’s Office; and, two, because the committee was very well led and because during the time of its being very well led some of the contentious matter was dealt with.

💬 Hon Member: Who by?

Georgina Beyer. Then a new leader took over and we got to the substance of the matter.

Tonight, in the 5 minutes available to me, I first of all want to make clear that enduring powers of attorney have two forms: the property enduring power of attorney and the personal care and welfare enduring power of attorney. Those two forms are often mistaken and muddled up. They are muddled up and amalgamated into what is known as a living will. Neither of those powers of attorney are living wills. In fact, there is no such thing as a living will, although people talk about them as though they are some great invention of the neo-liberals opposite.

💬 Judith Collins: What?

Yes, I knew that member might be listening.

💬 Judith Collins: I’ve been called many things but never a liberal.

And never new, either.

I want to talk particularly about clauses 9 and 10 of the bill.

💬 Dr Richard Worth: Clause 9 has been deleted.

Oh, that member wishes it had been deleted, because it is about property. The onus upon a lawyer is now much more considerable, and the charging practice of that interjector would never make him capable of doing properly the work of an enduring power of attorney in property matters. I draw that member’s attention to subsection (4) of section 97, inserted by clause 9. The subsection imposes an obligation on the attorney to be forever vigilant as to the welfare of the donor. The term “the welfare of the donor” is a concept that is quite strange to that member who interjected before, but I have to say that at the end of the day even property matters have ultimate beneficiaries—individuals and human beings—none more so than those covered in new subsection (4) in section 97, which will be inserted by clause 9 of this bill.

New subsection (4) provides that the donor may authorise the enduring power of attorney to have effect while the donor is mentally capable and to continue to have effect if the donor becomes mentally incapable, or only if the donor becomes mentally incapable. There is an important difference there that we should remember. It is clarified in the bill. The enduring power of attorney for property matters arises from one of those two matters.

I really want to talk about clause 10 of the bill, which inserts new section 97A. This amendment imposes on an attorney quite a high threshold of obligation. New section 97A describes how an attorney under an enduring power of attorney, in relation to a donor’s property, is to exercise that power if the donor becomes mentally incapable. Referring to subsection (2) of section 97A, the obligation of the attorney is such that: “The paramount consideration of the attorney is to use the donor’s property in the promotion and protection of the donor’s best interests,”. That statement may seem obvious, but in my submission this is where the important part comes in. Subsection (2) goes on to state: “while seeking at all times to encourage the donor to develop the donor’s competence to manage his or her own affairs in relation to his or her property.”

In my submission that is one of the remarkable features of this bill and is a remarkable amendment to the present Act. It brings to the forefront the obligation even for property powers of attorney to have regard to the well-being of the donor at all times and to encourage the donor to develop competence in the management of his or her own affairs. The stories are legion about lawyers particularly—provincial lawyers often—who become set in their ways. They become so set in their ways—[Interruption] as is demonstrated by the heckling from the rather hardened members of the National Party on the other side—that despite the best will in the world they proceed to set up law practices that manage wills and powers of attorney as though they are self-enduring and self-fulfilling functions.

Law firms in the modern day have policies in place that will enable them to check that their staff are meeting their obligations. The alterations brought about by new section 97A bring to the forefront the fact that at all times the obligation to deal in good faith with property is not the only obligation. The very real obligation is to make sure that the donor’s well-being is at the forefront, so much so that he or she is encouraged to gain competence to manage his or her own affairs.

Last night, during the second reading debate, I spoke about the ability of mental health patients to still be considered capable of managing aspects of their affairs. New section 97A, inserted by clause 10, embodies that principle in very stark reality.

I conclude speaking on this part in the Committee stage by saying that I consider it a matter of great moment that a bill that deals with property rights and enduring powers of attorney carries that very human requirement to have regard for the donor and to at all times administer the property obligations with a view to encouraging the donors themselves to regain competence so they can manage their own affairs.

The twilight is nigh for the lawyers who in the past took it upon themselves to have a power of attorney and go off on a tangent, often leaving the beneficiaries and donors in the wake, unable to respond to or to take issue with what they sensed was wrong but were not able to articulate.

This bill is a very good amendment to the Protection of Personal and Property Rights Act. It is an amendment that reflects the current thinking of an enlightened Government, which reflects the long gestation period that Dr Hutchison referred to before. Emerging from that long gestation is a very finely tuned bill. It was honed out by a very attentive select committee, and it has been delivered to a very diligent Minister for consideration by this very, very considerate Committee.

The question was put that the amendments set out on Supplementary Order Paper 145 in the name of the Hon Ruth Dyson to Part 2 be agreed to.

Amendments agreed to.

Part 2 as amended agreed to.

Clauses 1 to 3