FAQ: Appointing Lasting Power of Attorney
Many people have a basic knowledge of what an Attorney does, but are concerned that appointing an Attorney will automatically mean they give up their independence over their property and financial affairs, their health and welfare.
Tamsyn Ward TEP of Tamsyn Ward Solicitors has helped numerous people set up Power of Attorney, and she shares some of her expert advice on getting it right without worrying.
What is a Lasting Power of Attorney?
Lasting Powers of Attorney (LPA) were introduced in the Autumn of 2007 and replaced the pre-existing Enduring Powers of Attorney (EPAs). They allow a person to appoint whom they wish to act on their behalf to deal with issues relating to their assets or health and welfare if they no longer have capacity to act.
There are two types of LPA:
- The most popular form deals with appointing Attorneys to deal with an individual’s property and financial affairs.
- The second LPA type deals with appointing Attorneys to deal with health and welfare issue.
Both forms are independent from each other and may be made on separate occasions.
What should our parents think about when choosing an Attorney?
Careful consideration should be made when choosing who to appoint to act as Attorney. Although it seems obvious, an Attorney must be someone your parent trusts as they have a duty of care to act in their best interest.
Who can be an Attorney?
An Attorney may be a family member, partner, friend or professional advisor, (so long as there is no conflict of interest), or a trust corporation (usually a Bank managing client fund.)
Who can’t be an Attorney?
An Attorney must be over the age of 18 years, must not lack mental capacity themselves or be an undischarged bankrupt (in the case of property and financial affairs). If a person becomes bankrupt after the LPA has been registered, they will no longer be able to act and the LPA may be cancelled.
How do Attorneys make decisions?
If your parent is planning to appoint more than one Attorney, great care should be taken to ensure they’re willing to act together. Your parent may appoint them to act jointly, jointly and independently or jointly in some matters and jointly and independently on others. It can get extremely confusing so it’s important to know who has authority over certain matters.
What happens if Joint Attorneys can’t or won’t work together?
Joint Attorneys must act together in every decision. Should one Attorney disagree with a decision then the proposed cause of action cannot be made and if Attorneys cannot work together, the LPA may be cancelled by the Court. If an Attorney dies or disclaims then the LPA comes to an end unless a replacement Attorney has been appointed.
Attorneys appointed to act joint and independently is more flexible and should an Attorney disclaim or die, the remaining Attorney may still act.
How long does it take to set up an LPA?
Preparing an LPA can be done pretty quickly and registration of the document at the Office of the Public Guardian (OPG) can take as little as 6 weeks if no objections are raised.
How do we use an LPA?
Once an LPA has been completed and signed by all parties, it can only be used by the Attorneys upon being registered at the OPG. An application to register an LPA may be made by the Attorneys or the individual Donor (ie. your parent).
Once registered at the OPG and unless stated to the contrary, it will be possible for Attorneys to request and register certified copies immediately in order to access, in the case of a property and financial affairs LPA, the Donor’s assets irrespective of whether the Donor has lost mental or physical capacity.
However in the case of a registered health and welfare LPA, Attorneys may only act when the Donor has lost mental capacity.
Why prepare LPAs?
I recently met a client who had moved into a nursing home and whose physical and mental health was failing. The gentleman’s wife had asked me to meet with her husband to discuss the process of preparing LPAs and after several visits and discussions about the document, he confirmed he had understood all that I had said, but still could not see the direct benefit preparing an LPA would be to him.
Although it seems an obvious point, preparing LPAs allow an individual to appoint whom they wish (within the legal boundaries set out) to act as an Attorney on their behalf. There is of course no obligation to prepare either LPAs, but in the event that either mental or physical capacity to manage their own affairs is lost, LPAs allow a way of handing over the reins and keeping affairs running smoothly for your parent’s own benefit as well as that of carers, such as a spouse, partner, child or other relative or friend.
Help, there is no LPA in place!
On occasion, an LPA has not been prepared in time, either due to the individual’s ill health or family conflict rendering a decision impossible to make. In these circumstances an application must be made to the Court of Protection (COP) to apply for an Order to act as a Deputy over an individual’s property and financial affairs and health and welfare.
Applications to the Court invariably result in a higher financial and personal cost to the individual who is often “stuck” whilst the Court takes time to examine the application and issue the Order.
Are the rules for LPA the same across the UK?
The rules for LPAs differ in Scotland, but it is unlikely a registered LPA would be rejected by investment companies, pension providers or care homes.
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