Benefits of Lasting Power of Attorney
Prompted by recent OPG research and due to launch across the UK, the new campaign videos are focused on increasing the number of LPA registrations by promoting the benefits and dispelling the myths associated with the rights that family members and deputies hold.
What’s All the Fuss About?
Our profession is constantly banging on about benefits of making a Will. In drawing up your Will, you’re making provision for those you care about after you die. But too few of us know we should also consider drawing up a Lasting Power of Attorney – or LPA.
According to the Alzheimer’s Society, by 2025 more than 1 million people in the UK will have dementia. One in five people over 85 already suffers from it. And the rates are significantly higher among women than men.
If you don’t have an LPA in place, handling your affairs can become virtually impossible if you lose capacity. Your relatives may face long delays and expense in applying to the court of protection to get access and take control of your assets and finances.
This is why so many charities, including the Office of the Public Guardian (OPG), recommend we all plan ahead. Having an LPA in place will ease the burden on your relatives and make sure you’re taken care of as you would wish, without delay or outside interference.
Let’s face it, mental and physical incapacity can hit at any time, it’s not just the domain of the elderly; those of us who have not yet drawn a pension can also become incapacitated through accident or illness too.
So, what is a Lasting Power of Attorney?
LPAs were introduced under the Mental Capacity Act 2005 in October 2007. They replaced Enduring Powers of Attorney or EPA, but if you made an EPA before that date, it will still be valid.
LPAs are legal documents in which you (the Donor) appoint someone else (the Attorney) to act on your behalf and in your name. They are recognised by financial institutions, care homes and local authorities, as well as tax, benefits and pension authorities.
You can set up an LPA yourself or you can ask a solicitor to do the application for you. An LPA is a very powerful document, so read through the forms and guidance before you proceed. If you are in any doubt, talk to a lawyer who will put your mind at rest.
There Are Two Different Type of LPA:
- Property & Affairs LPA: This type will allow your Attorney to manage payments from your bank accounts and action the sale of any property.
- Health and Personal Welfare LPA: This allows the Attorney to make important decisions about your health and welfare, such as whether an operation should take place and what care you may require.
A critical difference between the 2 types of LPAs, is that:
- a property and financial affairs LPA can be used while someone still has capacity; but
- a health and personal welfare LPA can only be used once they have lost it.
Choosing the Right Attorney(s)
You can choose anyone to become your Attorney, provided they are over 18, not a bankrupt and they understand/accept the responsibility they are taking on. We’d recommend you choose more than one Attorney. If you draw up the 2 types of LPA, you can have the same Attorney(s) for both, or different Attorney(s). Make sure the individual(s) are people you trust.
If you’re unsure about who to choose, a good alternative is to opt for a professional Attorney (such as a solicitor or accountant). They will act on your behalf and help you with things you are struggling with.
How Does an LPA Work?
Your Attorney(s) must make all decisions in your best interests and follow certain principles set out in the Mental Capacity Act. As a starting point, your Attorney(s) must assume that you can make your own decisions unless they can establish that you can’t. They must also support you in your decision-making process as far as possible.
As a Donor, you can restrict or specify the types of decisions your Attorney(s) can make, or you can allow them to make all decisions on your behalf.
Role of Next of Kin
Many people think that your ‘next of kin’ can make decisions on your behalf if you lack the capacity to make them yourself. However, your spouse – or partner if you’re not married, does not have any legal right to make health decisions on your behalf. Irrespective of how long you’ve been together.
The only people who can make decisions on your behalf are those who have been authorised to. Your LPAs will confirm who you’ve chosen.
An LPA is Not Valid Unless It’s Registered
Before the LPA can be used it must be registered with the OPG. Until it’s registered, your LPA cannot be used. As a guide, the registration process will take between eight and 10 weeks.
Timing Is Key
Experience dictates that the older you become, the chances of you losing mental capacity (perhaps through dementia) will increase. So, it’s important to understand that you can’t set up an LPA for someone who has already lost capacity.
Your relatives will need to apply to the Court of Protection to be appointed as a ‘Deputy’ if any decisions need to be made on your behalf. An application for a Deputy can take several months, during which your accounts may be frozen, resulting in a lot of stress for everyone involved.
This process is likely to be much more costly than writing an LPA in the first place. A Deputy has a similar role to an Attorney under an LPA, although the Deputy will need to pay an annual recurring fee and will also need to produce regular, detailed financial reports to the Court of Protection.
In some ways, drawing up an LPA is more important than drawing up a Will. If you die without making a Will (intestate), you can’t choose where your estate ends up or necessarily make sure your loved ones are provided for. But if you lose mental capacity without an LPA, it’s almost impossible to deal with your affairs. Your family will have to apply to the Court of Protection to make decisions about your health and welfare or access your money.
So, our advice is to plan ahead and stay in control. If you need further information or advice, please contact us. We’re here to help.
Please note that all views, comments or opinions expressed are for information only and do not constitute and should not be interpreted as being comprehensive or as giving legal advice. No one should seek to rely or act upon, or refrain from acting upon, the views, comments or opinions expressed herein without first obtaining specialist, professional or independent advice. While every effort has been made to ensure accuracy, Curtis Parkinson cannot be held liable for any errors, omissions or inaccuracies.