A successful business may come to a sudden standstill if the sole director and shareholder dies or becomes incapacitated. The company may be unable to operate bank accounts, pay employees or take steps to sell the business; leading to delays, unnecessary costs and pain for loved ones.
All sole director companies should consider implementing a Corporate Power of Attorney to avoid difficulties that can face a company in the event of the death or incapacity of a sole director.
A Corporate Power of Attorney allows a nominated attorney (or attorneys) to stand in the director’s shoes when the director is unable to act and make decisions for the company ensuring continuance of the company’s affairs.
It is important to recognise; a personal Power of Attorney or Will is no substitute for a Corporate Power of Attorney. Even if you have a personal Power of Attorney this will not permit your attorney to sign documents on your behalf as a director.
A Corporate Power of Attorney should be considered as part of any effective Estate Plan to ensure that you decide to whom your assets are transferred to or controlled by in the event of death or incapacity.
If you have any questions about implementing a Corporate Power of Attorney or Estate Plan, please do not hesitate to contact Generation Legal.
Suite 8, 35-37 Railway Parade, Engadine NSW 2233
(02) 8518 6000 www.generationlegal.com.au