Conflict Transactions – If I am the attorney for my parents can I buy their house?

Being appointed as your parents’ attorney under an Enduring Power of Attorney (“EPOA”) is a position of significant power and trust.

While an attorney may expect that they would be required to make decisions for their parents with everyday financial or health decision, such as paying bills, making medical and healthcare decisions, making decisions on living arrangements - questions often arise when the attorney wishes to purchase their parents’ property.

An attorney purchasing property such as a house from their parent who has lost capacity, engages complex legal issues. An attorney must always act in the best interest of the principal and must exercise power honestly and with reasonable diligence, so when an attorney proposes to buy their parents house whilst acting as their attorney, this creates a clear conflict of interest.

Under the Enduring Power of Attorney Act 1998 (Qld) an attorney may only enter conflict transactions if the principal, or the Court, has authorised the transaction.

Without an order from the Court, an attorney would need to rely on whether the EPOA contains an express authority for the attorney to enter conflict transactions.

So, if I am the attorney for my parents can I buy their house? The short answer is yes – but only in limited circumstances and with strict authority derived from an express authority in the attorneys EPOA or an order from the Court.

If you or anyone you know requires an Enduring Power of Attorney, is looking to renew their Power of Attorney or advice regarding conflict transactions please contact our Estate Planning Team on 07 4417 4417 or willsandestates@mobbsmarr.com.au.