Have you ever considered what would happen if you became physically and/or mentally incapable of managing your affairs? When you plan for the future it is sensible to plan for as many eventualities as possible.
A Power of Attorney can help in many situations. For instance, it may come in useful if you are away from the country for long periods, or perhaps if you are living outside the U.K. but still have assets in this country. Whatever the circumstances, you may need to have your financial and legal affairs looked after by someone you trust.
A Lasting Power of Attorney (LPA for short) can help you achieve this. Lasting Powers of Attorney can also be used to authorise another person to make health care decisions on your behalf should you become mentally incapable of making these decisions yourself.
Why make an LPA?
An LPA allows you to appoint people whom you trust to act as your Attorney. Once registered with the Court of Protection, your Attorney can then make decisions on your behalf which you would normally make yourself, for example paying your bills or collecting your income. Unlike its predecessor, the Enduring Power of Attorney (EPA), an LPA allows you (if you wish) to authorise a nominated person to make decisions regarding your personal welfare if you lack the mental capacity to make such decisions yourself. These decisions might involve the nature of medical treatment you will receive or where you should live.
By putting an LPA in place, if, in the future, you should become mentally incapable of looking after your own affairs, it enables those caring for you to avoid the complication of applying to the Court of Protection to be appointed as your Deputy (formerly known as a Receiver).
An LPA can be cancelled by you at any time. However an LPA cannot be cancelled once a donor has lost his or her mental capacity.
What if I don’t make an LPA and I do become mentally incapable?
Those who are looking after your affairs will have to make an application to the Court of Protection for Deputyship (formerly known as Receivership), which is a lengthy and costly process (the costs come out of your estate). In the meantime, your bank may freeze your accounts which could mean that bills are left unpaid. The Deputy must maintain a full account of your income and expenditure and usually must put in place insurance to protect your estate in the event he or she acts negligently. You have no control over who acts as your Deputy. By making an LPA, you can choose who will be responsible for managing your affairs.
What is an Attorney?
An attorney is a trusted person appointed by the donor to deal with his or her affairs – these affairs can be general or specified. They are under a duty to deal with the assets as the donor would have done if he or she were capable.
Any person over the age of 18 can be appointed, so long as they themselves are mentally capable and not bankrupt.
The person making the LPA is referred to as the 'Donor'.
What happens if the Donor does become mentally incapable?
The Court of Protection must be notified (if the LPA has already been registered). Otherwise, the LPA must now be registered with the Court and the persons specified in the document must be notified of the Attorney's intention to register. After registration the Attorney can then carry on dealing with the donor’s financial affairs and is accountable for doing so.
How can Wright Hassall help?
At Wright Hassall, we can draft an LPA for you and advise you fully regarding the nature and scope of an LPA and the various options you have with regard to the content of the document. We can provide the certificate of capacity which is now a legal requirement for anyone making an LPA. We can also deal with the registration of an LPA on your behalf after it has been created. We offer fixed fee Will and Power of Attorney packages. Please contact us for details.
We realise that many clients made Enduring Powers of Attorney (EPAs) under the old rules which remain valid under the new rules. We can register an EPA with the Office of the Public Guardian on the Attorney's behalf, giving formal notice to the prescribed relatives and drafting all of the necessary documents.
If there is no EPA in place and a client lacks the capacity to make an LPA, we can guide you through the application to the Court of Protection for Deputyship (formerly known as Receivership).
