If you have executed an enduring power of attorney, you as the donor have signed a document that gives another person, the attorney, the power to deal with your financial matters on your behalf, even when you can no longer act for yourself. Anything your attorney does for you is as though you yourself have done it, and therefore is legally binding to you.
By creating a power of attorney, it does not mean that you immediately lose your right to deal with your own financial affairs. You may not want your attorney to act on your behalf until you become incapacitated. To do this, you can simply leave the original power of attorney document with your solicitor, with clear instructions not to give the document to your attorney unless you have agreed to, or you lose capacity to act.
Furthermore, you can appoint your attorney to act for you only in specific circumstances by imposing conditions on their authority in the prescribed forms. Section 9 of the Power of Attorney Act 2003 (NSW) states that a “power of attorney confers on the attorney the authority to do on behalf of the principal anything that the principal may lawfully authorise and attorney to do”. Therefore, an attorney is liable and may be required to provide you with compensation if they exceed their stated authority. Although an attorney has been conferred power, they may not have the authority to execute a matter.
It is important for attorneys to understand that by holding this position, they have agreed to a fiduciary relationship where they must act in the best interests of you as their donor. They also have the specific obligations to keep your money and assets separate from theirs, and to keep adequate records of any dealings they have with your money and assets.