Be nice to your children because they will choose your nursing home. Or they might end up your full-time home carer, given the increasing aversion to institutional care among Australian families.

Jokes aside, the question about who will care for the growing aged population, and how that care will be delivered is one on which legal professionals in the elder law practice area are increasingly focused.

Lawyer David Davis told the Law Institute of Victoria’s Elder Law conference in June that there was a growing need for well thought-out legal guidelines to support the many families who chose to care for an elderly relative.

“There is a need for a coherent and structured process to safeguard the security of not only the elderly in need of care, but also the caregivers,” he told the conference. Many people make “family agreements” that typically involve the transfer of property or other assets by an elderly person in exchange for care by another family member. Most commonly, agreements are between a parent and a child. Many of these agreements break down, causing homes or life savings to be lost and relationships to be destroyed.

There are several reasons for the rise in these agreements, including limited access to residential aged care and a desire by older people to remain in the community. Others are reluctant to sell the family home to pay for an aged care place or may wish to maintain their eligibility for social security benefits.

At the same time, high workforce participation and high debt levels have made it harder for adult children to give up work or cut back on their hours to care for their parents. Mr Davis says people who are more likely to use family agreements will have their family home as their only asset, and little or no cash flow, aside from a pension, to pay for care.

Caregivers can also be vulnerable where there is no binding contract. An elderly parent’s failing health can place demands on the caregiver which are far greater than first envisaged. There are also occasions where the transfer of assets is challenged by the estate after the death of the senior.

This is compounded by the fact that family agreements are almost always made orally and without legal advice, are usually in broad terms and lack detail.

Many families have a psychological barrier to formalising such agreements as a binding contract. They believe trust should be enough but fail to consider the dire consequences, such as the non-return of money, should the arrangements fail.

Mr Davis believes a national legislative system setting out procedures and guidelines for such agreements, including a coordinated court response to resolving breaches, would be a welcome addition.

In the meantime, consult your lawyer before taking on any commitment to “care for life”. n

More information

From the LIV Bookshop

Older Residents and the Law: Accommodation, Care and Legal Rights in Victoria (2nd ed). By Robert Phillips. $49.95.