Hayley Mitchell, partner at Cooper Grace Ward Lawyers, said whether an attorney has the power to make or renew a BDBN is a complex question and depends on a number of factors.
“These include which state the member of the superannuation fund lives in, the terms of the enduring power of attorney document itself, the terms of the trust deed for the super fund, the relationship between the attorney and the principal, and who are the interested beneficiaries for the superannuation balance,” Mitchell said.
Queensland is slightly different to other states, Mitchell said, in that if the power of attorney document doesn’t exclude the power to make a binding death benefit nomination, then the attorney has the power under the legislation.
“However, it will be important to check the terms of the enduring power of attorney document itself. It may contain limitations or specific terms around when the attorney can make or renew the binding death benefit nomination,” she continued.
“It will be important to understand the exact interpretation of a clause dealing with this. In particular, whether it allows the attorney to make an entirely new binding nomination or just limits the attorney’s ability to renew or refresh an existing binding nomination already in place.”
She added that a good point of reference for Queensland is the case of Re Rentis, which focused on the interpretation of enduring powers of attorney.
Mitchell said the terms of the super fund trust deed are also going to be relevant as well as state regulations.
“Here, it’s going to be important to check that the trust deed doesn’t exclude an attorney’s ability to make a binding death benefit nomination,” she said.
“If the deed is silent on the question, my view is that it allows the attorney to make the nomination.”
Importantly, she said, an attorney cannot act in a conflict of interest, meaning they can’t make a decision that potentially benefits themselves or a member of their family.
“Therefore, it will be necessary to consider whether the attorney making or renewing the binding nomination benefits themselves or a member of their family in some way,” she said.
“Checking the terms of the power of attorney document, the terms of the trust deed and considering conflict issues is just the starting point for this question. The outcome is going to depend on a number of factors and seeking legal advice on this is a must.”
