Benefits of Lasting Powers of Attorney

2 November, 2020 6 minutes reading time

The Office of the Public Guardian (OPG) has launched a targeted campaign aimed at educating the public about the benefits of making Lasting Powers of Attorney (LPAs).

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 constantly talks about the benefits of making a Will. In drawing up your Will, you’re making provision for those you care about after you die. However, too few appreciate that they 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, 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 many charities, including the Office of the Public Guardian (OPG), recommend we all plan. Having an LPA in place will ease the burden on your relatives and ensure you’re taken care of as you 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 it would still be valid if you made an EPA before that date.

LPAs are legal documents in which you (the Donor) appoint someone else (the Attorney) to act on your behalf and in your name. Financial institutions recognise them, as well as care homes and local authorities, as well as tax, benefits, and pension authorities.

You can set up an LPA or ask a solicitor to make 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 doubt, talk to a lawyer who will put your mind at rest.

There Are Two Different Types of LPA:

1. Property & Affairs LPA: This type will allow your attorney to manage payments from your bank accounts and take action on the sale of any property.
2. Health and Personal Welfare LPA: This allows the Attorney to make important decisions about your health and welfare, such as whether an operation should occur and what care you may require.

A critical difference between the two types of LPAs is that:

• a property and financial affairs LPA can be used while someone still has the 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 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 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 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 your ‘next of kin’ can decide for you if you can’t make them yourself. However, if you’re not married, your spouse- or partner has no legal right to make health decisions on your behalf. Irrespective of how long you’ve been together. Only authorised people can make decisions on your behalf. Your LPAs will confirm who you’ve chosen.

An LPA Must be 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 essential to understand that you can’t set up an LPA for someone who has already lost capacity.

Your relatives must apply to the Court of Protection to become your ‘Deputy’ if you lose capacity. An application for a Deputy can take several months, during which your accounts may be frozen, resulting in much 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. However, 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.

Our Advice

In some ways, drawing up an LPA is more critical 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 must apply to the Court of Protection to decide about your health and welfare or access your money.

So, our advice is to plan 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.

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