There may come a time in your life when you are unable to make your own decisions. For example, due to disability resulting from an accident. Or due to a serious illness. In such cases, others will have to make decisions on your behalf. This may be temporary, but it could also last for the rest of your life. It usually affects older people. However, young people can also find themselves in a situation where they are no longer able to make their own decisions.
Place under administration
The law provides for the possibility of placing a person who is no longer capable of acting on their own behalf under guardianship. Guardianship is established by a court upon application. In doing so, a guardian is appointed. This is often a child of the person placed under guardianship. The guardian makes decisions on behalf of the person placed under guardianship. He or she ensures that those decisions are carried out. And every year, a report must be submitted to the court.
Living Will
Placing a person under guardianship is often a very emotionally traumatic experience. This is true both for the person being placed under guardianship and for the guardian. Nevertheless, the number of people placed under guardianship is increasing every year, according to rechtspraak.nl. In particular, the number of adults placed under guardianship is rising.
If you draw up a living will, it is usually not necessary to have a guardian appointed. You then decide for yourself which powers to delegate to the person who will look after your affairs should you no longer be able to do so yourself.
A living will is a set of powers of attorney. Under these powers of attorney, the person acting on your behalf is authorised to make decisions and take action on your behalf. As certain types of power of attorney are only valid if they have been drawn up by a solicitor, it is advisable to have your living will drawn up by a solicitor.
What exactly can you arrange in a living will? The Royal Notarial Association has produced a handy checklist compiled.
Estate planning
In our article A living will – something to think about We explain why a living will is a useful “tool” in the context of your estate planning. It enables your family, should you no longer be able to make these decisions yourself, to take the necessary steps to prevent you from paying too much tax or having to pay high personal contributions for the care you receive.
The reason why a living will is more practical for this than a guardianship is that there is no supervision of the person you appoint as your representative. You can, however, make arrangements for supervision in your living will.
Abuse
The fact that this is being abused in practice was demonstrated, amongst other things, by a judgement handed down by the Supreme Court in May 2016. The case concerned a mother who had granted her son and daughter power of attorney to manage her affairs. Upon the mother’s death, it emerged that the son had withdrawn over €450,000 from his mother’s estate, compared with just €56,000 by the daughter. The mother had divided her estate 50/50 between her children.
The Supreme Court agreed that the son had acted unlawfully by making the withdrawals. The daughter was therefore entitled to compensation. Furthermore, the son was required to pay statutory interest on that compensation, from the date on which the sums were withdrawn.
The mother could have prevented the unauthorised withdrawals by stipulating in the power of attorney that the children could only act jointly. Or by setting a financial limit per transaction in the power of attorney. Alternatively, a supervisor could have been appointed in the power of attorney.
If you have a living will drawn up, you need to be aware of the (often far-reaching) powers you are granting to your attorney(s).