What is a Lasting Power of Attorney?
A Lasting Power of Attorney (or LPA) is a legal document in which you nominate and appoint someone to make important decisions about your welfare, money or property. The power can take effect immediately or in the future.
Why should I make a Lasting Power of Attorney?
A Lasting Power of Attorney enables you to choose who you wish to have the responsibility for managing your affairs if you become incapable of doing so yourself. In addition, within the body of the LPA you can provide guidance on how you want your affairs to be managed if you were to become incapable of managing them yourself.
It is appropriate for a person of any age to consider making an LPA. Illness or accidents can strike at any time and render you incapable of managing your own affairs. Should the unexpected happen, it is a wise precaution to have the legal mechanisms in place in order for people to step in and make decisions on your behalf should you be unable to do so.
It becomes especially important to consider making a Lasting Power of Attorney as you get older. Although advances in medicine mean that people are generally living longer, doctors cannot always prevent declines in a person’s physical or mental state as we age. Having an LPA in place means that people you trust can begin to manage your affairs in accordance with your wishes if you become unable to make those decisions for yourself.
How is making a Lasting Power of Attorney different from making a Will?
A Lasting Power of Attorney allows people you trust to manage your affairs in your best interests during your lifetime.
What types of Lasting Power of Attorney are there?
There are two different types of Lasting Power of Attorney:
- Property and Financial Affairs Lasting Power of Attorney – This allows your nominated attorney(s) to take decisions on your behalf relating to money and property. This can include paying your bills but may also give them the power to make bigger decisions such as selling your home.
- Health and Welfare Lasting Power of Attorney – This allows your appointed attorney to make decisions on your behalf relating to your medical treatment and social and nursing care.
The two LPAs exist independently of each other and you can choose to make one or both. In addition, you do not need to appoint the same attorneys for both LPAs, although most people do.
Who can I appoint as an Attorney?
Anyone over the age of 18 can act as an attorney. In the case of the Property and Financial Affairs LPA, the attorney must not have been declared bankrupt.
When deciding who you want to act as your attorney, it is important to nominate someone who you trust absolutely to manage your affairs. This can be a close family member or friend. Sometimes people choose to appoint professional advisors as their attorneys.
Can I appoint more than one Attorney?
Yes, absolutely. Many people choose to appoint their spouse as their Attorney, together with one or more of their children, relatives or close friends.
If you appoint more than one attorney, you need to consider whether you want them to act “jointly”, which means they must do everything together, or “jointly and severally”, which gives them the power to act individually as well as together.
It is also wise to consider appointing replacement attorneys who would step in to act in place of your first named attorneys, should they become unable to act.
What responsibilities and powers will my Attorneys have?
Your attorneys have the following general responsibilities:
- To act in good faith and make decisions that are in your best interests;
- Maintain your confidentiality;
- Only make decisions that they are allowed to under the terms of the LPA
There are certain things that your attorney will not be able to do:
- Make decisions that are not in your best interests;
- Make gifts of your money or property, except in limited circumstances;
- Sign a Will on your behalf;
- Consent to marriage or divorce on your behalf;
- Make decisions on issues in which their power is limited or forbidden under the terms of the LPA;
- Make decisions on your health and welfare, unless you can be shown to have lost the mental capacity to make those decisions for yourself.
When does a Lasting Power of Attorney take effect?
A LPA can only take effect after it has been registered with the Office of the Public Guardian. It is important to note that it cannot be used at all until it is registered. The power can be registered at any time. If it is registered immediately after it has been completed, it is stored and only used at such time as it is needed. Alternatively the power can be registered at the time that the need to use it arises.
Does registering a Lasting Power of Attorney mean that I can no longer make decisions for myself?
Absolutely not. You can carry on making your own decisions despite the fact of registration, until such time as your capacity to make those decisions is lost.
What does it mean to “lack mental capacity”, and how is this assessed?
A person is deemed to lack mental capacity if they have an illness, injury or condition which impairs their ability to make specific decisions. It is possible to have the capacity to make some decisions but not others.
A wide range of professionals could be involved in assessing mental capacity such as solicitors, doctors, psychologists and social workers.
Can my Lasting Power of Attorney be cancelled at a later date?
If you have mental capacity to do so, you can cancel your LPA. You need to revoke the power formally. Simply altering the original document is not sufficient for this purpose.
If one of your Attorneys is your spouse or civil partner, their appointment is automatically ended by a divorce, annulment or dissolution, unless the LPA expressly provides otherwise.
What happens if I lose mental capacity but there is no Lasting Power of Attorney in place?
A Deputy will have to be appointed to act on your behalf by the Court of Protection if there is no Power of Attorney in place.
If your loved ones have to apply to the Court to appoint a Deputy, this could lead to a lengthy, stressful and costly process for them. The Court may not appoint the person(s) you would wish to make decisions on your behalf. It is far safer and potentially cheaper to plan ahead and set up an LPA so that it is already in place at such a time as it is needed.
I have a property outside of England / Wales, is this covered by my Lasting Power of Attorney?
The lasting Power of Attorney gained in England and Wales is only effective in this jurisdiction. If you have property outside of England and Wales, you will need to seek Power of Attorney (or equivalent) for the location of the property.
What is an Enduring Power of Attorney and how is it different to a Lasting Power of Attorney?
Lasting Powers of Attorney have replaced Enduring Powers of Attorney. EPAs are still valid provided they were made before October 2007, however, it is now no longer possible to make a new Enduring Power of Attorney.
The main difference between the old Enduring Power of Attorney and the new Lasting Power of Attorney is that an EPA only grants powers in respect of property and finances and not health and welfare.