Power of attorney

Hi guys,

Just a quick question. Hopefully not a trick question haha. We are looking at property at the moment and then came to learn that my partners mother is power of attorney for a close close friend who is now in a nursing home.

He has a property sitting empty very dilapidated, but in the area we would like to buy. We are hoping to buy it slightly cheaper or in our favor as we plan on doing the work etc etc.

The beneficiary of his will is some kind of cult type church thing. Not that that matters but my question is as power of attorney can my partners mother sell the property to us on his behalf, and more importantly at a cheaper price. Eg appraised at around 700k we were hoping to pay 600k.

How do I go about this as the beneficiaries solicitor will want top dollar correct? So my plan is a pipe dream?

Hope that all made sense. Can provide further information if needed and appreciate any tips or help.

 

I dont understand how the beneficiary gets a say if the person is still alive?

 

Please read this link before doing anything further: Attorney FAQs | The NSW Trustee and Guardian

"
Your attorney is in an important position of trust and has a responsibility to always act only in your best interests. They therefore must:

• Avoid doing anything as an attorney which would mean that their interests conflict with your interests;
• Obey your instructions while you are mentally capable and any directions you make in the Enduring Power of Attorney;
• Act according to any limits or conditions placed on their authority;
• Not give gifts or give themselves or others a benefit using your finances unless you specifically authorise this. The gift given must be seen as reasonable given the circumstance;
• Keep their finances and money separate from yours;
• Keep accurate and proper records of their dealings with your finances or property.
  
  
  

 

Promising! Haha

That makes sense. So he is not able to make the decision for himself she can exercise her power of attorney rights?

He is still alive! Would there be any issues with the discounted price?

 

The question is, is your mother acting in her friend's best interests by selling you his property for less than market value?

The person is not deceased, beneficiaries do not come into the picture yet.

 

Thanks larrylarry! Looks like that answers it

 

The property sits there empty and the strata fees etc keep rolling in. So selling it is in his interests..... Less than MV probably not ....

 

Yes, selling it is not a problem but it has to be in his best interests. Your mother has the responsibility and must be able to perform her role to the best of her ability. Transactions have to be in arm's length. It's not worth the risk for anyone involved.

 

Though she could get a number of valuations, and market estimates.

Then taking into account any sales fee's and charges (that wouldn't apply if you bought it, IE: agents commission, advertising) and ongoing strata fees (if you were to settle sooner rather than the property sitting on the market for months).

Then YES, she should have enough proof if questioned, to justify the sale price to yourself if questioned by the beneficiary.

"IF" you cant be easily identified as related, then I wouldn't raise the issue.

"IF" you are really concerned about it all, SEEK legal advice, because any reply here is just an opinion (like mine, and not legal advice).

 

Yes, not legal advice from me either. Tread with caution, that's all I can say.

 

Yes potential breach of fiduciary duties. Why is it in the interests of the woman to have her property sold and how will your mother prevent allegations of favourship etc. My advice to her would be dont.

 

My thinking was along the line of yours stoffo! But in glad terry came in here to straighten me out... I was afraid it would be this outcome.

 

Dodgy and vulture behaviour.

(notice the u)

 

If it was sold at auction and you were successful then that is fine but it would be less clear if you were the highest bidder but below the reserve price.

Is selling in the person's best interests? Eg Will it mean that they are no longer eligible for the pension?

 

If this was one of your loved and elderly vulnerable relatives, how would you feel, if you found that someone had abused a position of trust to steal $100,000 from them?

Basically, this is what you are proposing. Shame on you.

 

If the person is alive and has mental capacity why can't you speak with them directly to see if they want to sell their property and negotiate from there?

An attorney selling a property under market value without express instructions from the donor is very likely a breach of their fiduciary obligations.

 

Indeed. A doctor at the nursing home should provide an opinion on the person's mental capacity before instructions are taken. I'd rather make sure everything is done properly.

 

First time ive been called a vulture yeah the idea only came about because the beneficiary is some Wizard Reincarnation Cult type group. I mean I'm pro Gandalf and Dumbledore but its absurd.

Thanks for the responses! I appreciate all the info