Losing your brainpower can be an expensive exercise if you don’t have your house in order. It can also be a stressful time for family and loved ones who are already trying to deal with their sudden loss of mental capacity.

If you have not taken the practical step of completing a durable power of attorney, then no one will be in a position to make decisions related to your personal care and welfare and your real and personal property will be tied up until such time as the court appoints someone to handle your affairs. The process is administered by the Family Court, which in New Zealand is part of the District Court.

Obtaining court orders can take a long time, particularly if family and loved ones disagree on who should request the appointment. Furthermore, regardless of whether or not the process is relatively seamless, it will take several months and cost many thousands of dollars.

To ensure that the best interests of the subject person are served, the court appoints a “counsel for the subject person” chosen from a panel of attorneys experienced in these matters. That person is paid from a consolidated fund. Their role is to interview the subject person as well as those seeking appointment as welfare guardians and property managers to convince the court that the appointments are in the best interest of the subject person.

Eventually, after a hearing is obtained and all affected parties are given an opportunity to be heard, the court will eventually make orders. You can expect this to cost between $3,000 and $5,000. Although applicants are technically responsible for the legal fees associated with the application, it is common to seek an order that the fees be paid from the subject person’s assets.

Probably the worst part is that the initial court order lasts for two years and then applicants have to do it all over and over again in three year intervals, incurring the same cost each time, usually at their own expense. It only stops when you regain mental capacity, which doesn’t happen that often, or when you die.

The real insanity of it all is that all of the unnecessary exercise could have been avoided if only you had had the foresight to set up a durable power of attorney while you had the chance. The likely legal fees would have been a fraction of what the court process cost and you would have made the decision yourself. Those you love would also have saved themselves a tremendous amount of stress. What makes it even worse is that there are even viable online options available where you could have done it yourself and saved even more money than consulting an attorney.

So if you don’t have durable powers of attorney, do yourself a favor and do something about it now while you can and before it’s too late.

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