Updated 22 October 2026
Wills - Potential Problem #18: Not Planning for Disability
Planning for a possible loss of decision-making capacity is an essential part of estate planning in New South Wales. A will deals with your estate after death. It does not authorise your executor to manage your money, property or care while you are alive. Appropriate appointments can help protect your wishes and reduce uncertainty for your family.
A stroke, injury or progressive illness may affect someone’s ability to make particular decisions. However, disability, dementia and legal incapacity are not interchangeable. The starting point is to respect the person’s autonomy, provide appropriate support and consider what they can understand and decide in the circumstances.
The documents that protect you during your lifetime
An enduring power of attorney appoints someone to deal with financial and legal matters, such as bills, banking and property transactions. Its commencement depends on its terms and the attorney’s acceptance. It can begin before incapacity and continue afterwards. A general power of attorney does not continue after loss of the relevant capacity, and an enduring appointment ends at death.
An appointment of enduring guardian covers specified personal, health and lifestyle decisions when you cannot make those decisions yourself. It may cover accommodation, services and medical consent. It does not give authority to operate your bank accounts. Your chosen guardian should understand your preferences and be willing to act.
A will, enduring power of attorney and enduring guardianship appointment perform different jobs. An advance care directive can also record treatment decisions and values. Discuss the documents together so that financial arrangements support your care preferences. Simply naming your spouse as executor in your will does not provide authority during your lifetime.
Choosing an attorney deserves careful thought. The role involves responsibility for your affairs, rather than a reward for a family member. Consider whether the person can keep records, manage competing demands and respect limits on their authority. Discuss how they would handle a disagreement or a transaction involving their own interests. Clear instructions and sensible safeguards can reduce uncertainty, but the appointment should still leave room for decisions that cannot be predicted when the document is signed.
Capacity depends on the particular decision
Capacity is assessed for the decision being made at the relevant time. Someone who cannot manage complex investments may still understand a simpler decision or have capacity to make a will. A diagnosis or an unusual choice does not settle the issue. The assessment must consider the applicable legal test and the person’s actual abilities.
Support can make a significant difference. A quiet appointment, plain language, hearing aids, breaks or an independent interpreter may help someone understand and communicate. A relative should not answer every question for the client. The solicitor needs to hear the client’s own instructions and check for pressure or undue influence.
How lawyers and medical professionals work together
A solicitor considers whether the client meets the legal test for the proposed document or transaction. A doctor assesses clinical matters, including illness, cognition and functional ability, and may give an opinion directed to that test. These are complementary roles. A medical report informs the legal assessment; it does not automatically determine whether a document is valid.
For a will, the questions include whether the person understands what making a will involves, their estate in broad terms and the people whose claims they should consider. An attorney appointment requires a different, relevant assessment. Where capacity is disputed, the court or tribunal ultimately determines the legal question. Neither professional should treat a general certificate as the answer to every possible decision.
Christine on specialist reports for clients with dementia
When a client has dementia, I do not treat the diagnosis as the end of the conversation. I want to understand what they can decide and what support they need. My legal assessment and the doctor’s clinical assessment need to work together, with the client at the centre of both.
Where memory, reasoning or fluctuating cognition raises concerns, I place particular importance on a targeted neurological or other appropriate specialist report. Depending on the circumstances, that might mean a neurologist, geriatrician, psychiatrist or neuropsychologist. A GP who knows the client well can also provide valuable evidence. A specialist report is not automatically required for every client with dementia; the appropriate assessment depends on the circumstances.
I explain the proposed document and the questions the report needs to address, with the client’s consent to obtaining relevant information. I need useful observations about understanding and reasoning, rather than a brief statement that someone is “of sound mind”. I consider that evidence alongside my own discussions and detailed notes. A screening score alone cannot do that work.
Timing matters too. I do not want an unnecessary wait for a specialist appointment to deprive someone of the opportunity to make a will. Where capacity is arguable and the matter is urgent, the solicitor must consider the available evidence, practical safeguards and the consequences of delay. The aim is to protect the client’s ability to make their own choices.
A real NSW case about testamentary capacity
In Ryan v Dalton; Estate of Ryan (2017), the NSW Supreme Court considered whether a man had capacity to make a later will. His solicitor’s observations supported capacity, but nursing-home records and retrospective specialist evidence raised substantial concerns.
Considering the evidence as a whole, the Court was not satisfied that the 2013 will had been made with the required testamentary capacity. It granted probate of the earlier 2011 will. Kunc J highlighted careful questioning, contemporaneous records and obtaining an assessment where necessary.
This was a will dispute, rather than a decision appointing a financial manager or guardian. Its practical lesson is that social conversation and apparent agreement may not establish understanding. Medical evidence and the solicitor’s observations need to be examined together. The judgment does not make neurological reports compulsory for everyone with dementia.
What happens if capacity has already been lost
If someone lacks capacity to make a particular appointment, family members cannot simply sign a new enduring power of attorney for them. Existing documents and other lawful arrangements should be checked first. Being a spouse or adult child does not automatically confer general authority over another adult’s finances.
An application to NCAT for financial management or guardianship may be necessary. These are separate decisions, and the Tribunal considers the relevant statutory requirements, the need for an order and available alternatives. A suitable relative or friend may be appointed financial manager; a professional or public appointment is not automatic. Some medical-consent decisions can instead be made through the statutory “person responsible” hierarchy.
Why early planning matters
The Australian Institute of Health and Welfare’s July 2026 report projects around 459,000 Australians living with dementia in 2026. This is a population projection, not a count of people who lack legal capacity. It supports planning early while recognising that each person’s circumstances require individual consideration.
Five practical steps to take now
1. Review your documents. Check your will, enduring power of attorney and enduring guardianship appointment together. Identify gaps before an urgent hospital admission or other crisis.
2. Choose suitable people and substitutes. Discuss responsibilities, availability and potential conflicts. Decide how multiple appointees should act and what happens if someone cannot continue.
3. Explain your circumstances. Tell your solicitor about relevant diagnoses, communication needs and changes in memory or judgement. Agree on suitable support and any targeted clinical assessment.
4. Complete the formalities properly. Follow the applicable witnessing, acceptance and commencement requirements. Ask whether registration is needed for proposed property dealings.
5. Keep arrangements accessible. Record where signed originals are held, tell appropriate people how to locate them and review appointments after significant health or family changes.
CM Lawyers can help coordinate your wills and estate planning, explain the different appointments and address capacity concerns sensitively. Contact our team to discuss arrangements suited to your circumstances.
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