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Thursday, June 30, 2022

Experts present valuable information during webinar on financial abuse against elders

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A panel of Australian legal and social-work experts, facilitated by Elder Abuse Action Australia, convened on Thursday to discuss a widely underused legal instrument that promise to ward against financial abuse of elders – but only when done right.

A family arrangement is an agreement made by an elder with a caregiver – often a child, but it could also be a service provider, a friend or a partner – to exchange some of their assets in return for care.

“Such an agreement may take the form of a deed of family arrangement, a co-ownership agreement in relation to sharing possession of particular property, a ‘granny-flat’ type of agreement, a care and residence agreement, or a contract to make a will which may be conditional upon carer services being provided,” according to Elderlaw, a prominent Sydney law firm dedicated to elder-rights based litigation.

“The form of agreement and the possible circumstances are almost infinite.”

Many older people want to be able to share the wealth they’ve built up with their family before they die… [and] a lot of these financial relationships work out really well… it’s a way of people living together and having that co-dependence that allows them to live the lives they want to.

Melanie Joosten

Coming to the table with vast, on-the-ground experience of these contracts in force – for better and for worse – were panellists:

  • Professor Eileen Webb, a former property lawyer and now a professor of law and ageing at the University of South Australia
  • Dr Rachel Carson, a socio-legal researcher at the Australian Institute of Family Studies, with expertise in family law and qualitative research about family law disputes
  • Melanie Joosten, a senior advisor for research and policy at RMIT’s Centre for Innovative Justice, social worker and writer

When done right, Joosten notes, the agreement should be one that is “mutually beneficial”.

“Many older people want to be able to share the wealth they’ve built up with their family before they die… [and] a lot of these financial relationships work out really well… it’s a way of people living together and having that co-dependence that allows them to live the lives they want to,” she says.

Social worker and RMIT senior policy advisor, Melanie Joosten, says that when entered into freely and negotiated with the advice of legal and financial professionals, family agreements can be mutally beneficial for both elders and their carers.

However, a major problem stems from the majority of these contrasts being made verbally, without first consulting with legal and financial professionals, notes Webb.

“Often these sorts of arrangements happen during a time of family crisis … so they can tend to be entered into quite informally … and indeed quickly without considering the consequences,” she says.

 

Informal contracts heighten the likelihood of abuse

Carson notes that according to the National Elder Abuse Prevalence Study, carried out by the Australian Institute of Family Studies, only 3 per cent of participants had a family agreement, whereas 88 per cent of the cohort had a will.

“Under two thirds of these people actually had the agreement in writing, she says.

“From the [study], we can see that these arrangements are uncommon, and there’s a correlation between having these arrangements and elder abuse.

“My caution would be to receive independent legal and financial advice before entering these agreements.”

Rachel Carson is a socio-legal researcher at the Australian Institute of Family Studies, and she notes that currently, family agreements are rarely entered into but data shows a correlation between the presence of these agreements and elder abuse, emphasising the need to better assist elders through advocacy and legal representation.

These concerns were echoed by a 2019 report from the Australian Law Reform Commission indicating that, without facilitation through legal professionals, family agreements made verbally, or in written form drafted by a vested party to the contract (for example, the child carer who will directly benefit from the arrangement), are more likely to result in financial abuse than legal protection for the elder.

“While such arrangements can fulfil an important social purpose, there can be serious consequences for the older person if the promise of ongoing care is not fulfilled, or the relationship otherwise breaks down,” the report reads.

“The older person may be left without money or even a place to live, a kind of financial abuse identified by many stakeholders…”

Webb notes that a major reason for the failure of these contracts to protect elders is due to the lack of planning for when something goes wrong.

“I would suggest seeing a lawyer about this, simply because there are so many contingencies.

“Discuss all the options and contingencies, not just if there’s a relationship breakdown. What if someone falls sick? What if there’s bankruptcy?”

University of South Australia professor in Law and Ageing Eileen Webb, who has a background of practicing property law, emphasises the need for elders to work with a legal representative to draft a family agreement contract that details, in writing, both the parameters of the agreement and what will happen in the event something goes wrong, or if the carer fails to deliver on their promises.

Joosten notes that in her experience as a social worker, elders can be coerced into gifting their assets, without receiving the verbally agreed upon care, in return.

“There are situations when an older person has signed off their house with the promise of being given care, but they end up neglected.”

And sadly, elders may be obliged to dispose of assets, or feel ineligible to put their name on a property title that they are the technical part owner of, due to their ineligibility for Centrelink benefits – such as the pension – creating a coercive environment.

“There’s so many conflicting [legal] issues here and they don’t necessarily play out for the benefit of the older person,” Webb notes.

Furthermore, there is often an emotional pressure at play, with elders not wanting to suggest that they distrust their children by seeking legal advice.

But the panel was unanimous in noting that legal and financial advice is absolutely essential for protection of all parties in the long run.

One of the most important things that you need to do: think about yourself, think if this is really what you want. Are you being pressured? What might you be giving up in terms of independence, in terms of assets, in terms of the future?

Melanie Joosten

Webb says that “if the older person does not have a contract and is trying to get their money back, they’ll have to go through a superior court … that means time, a huge amount of money and stress, dealing with your family.

“My takeaways are to get financial and legal advice and to document … get it in writing, and get on the title of the property, if this is relevant to your transaction.”

Webb also notes that there are significant barriers to access for elders with minimal liquid assets.

“The thing is, solicitors can be expensive, and people are concerned about taking that step … we need more affordable legal advice.

“Think about your Community Legal Centres and seniors rights organisations.”

Joosten implores elders to think independently about their own needs and wants before entering into any such arrangement.

“One of the most important things that you need to do: think about yourself, think if this is really what you want.

“Are you being pressured? What might you be giving up in terms of independence, in terms of assets, in terms of the future?”

She also notes that in larger families, with multiple siblings, it’s important to have a whole family discussion “to ensure everyone’s on the same page.

“It’s much better for these things to be open and transparent … [otherwise] it may feed into family feuds…”

To view the full, 50 minute webinar, follow this link.

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