Lasting Powers of Attorney & Joint Property

2 April, 2021 3 minutes reading time

We always advise clients to put a Lasting Power of Attorney (LPA) in place whilst they still have the mental capacity to do so. And, it seems people throughout the UK are convinced of the benefits. Over 800,000 LPAs were registered during 2019, and an average of 20,000 per month in the first couple of months of 2020.

However, in the context of lasting powers of attorney for those couples who jointly own their property, and one partner loses mental capacity, selling the property isn’t always straightforward.

Jointly Owned Properties – Pitfalls

Most couples own their property together. However, if one partner loses mental capacity and the jointly owned property has to be sold, in the context of an LPA, the situation can sometimes be complex. For example:

John and Anna Baxter are married and jointly own their property. Both have LPAs in place. John and Anna are each other’s attorney with no co-attorney or replacement/backup named. Unfortunately, after a serious accident, John loses mental capacity and, as a result, will need round-the-clock care.  The decision is made that the family home will be sold to fund his care, but Anna is John’s only Attorney under the LPA.

If you own property jointly, it’s legally held in trust for both owners. Because of this, the law (specifically the 2007 regulations) requires two trustees to handle the sale of the property.

John is not fit to make the decision, and, as the only remaining owner and Attorney, whilst Anna can make decisions on John’s behalf, she can’t legally sign the transfer.

Practically speaking, the solution would be to draw up another LPA. However, in this scenario, John is no longer in a position to do this.

Jointly Owned Properties – Solutions

This situation is resolved by appointing another trustee. The regulations governing that govern this are found in the Trustee Delegation Act 1999.

Under a ‘deed of appointment’, the additional trustee – a trusted friend or family member – is granted the power to make a decision on John’s behalf, regarding the property sale or transfer.

Plan Ahead

Naturally, it’s best to avoid this complication happening in the first place. So, as ever, plan ahead. The simplest solution is for each joint owner to appoint:

• Different attorneys, or
• Two attorneys with the power to act jointly and severally.

In either case, this would mean that two different trustees would be available to sign the transfer to sell the property. No unnecessary delay, inconvenience or cost.

Choose your extra attorney or trustee carefully. Make sure they understand the job and are willing to do it. If you don’t want to ask a friend or family member, you can hire a professional, like a lawyer or accountant. Professionals will charge a fee, but they have lots of experience and know what to do.

Our Advice

If you would like to book a Video Appointment, this section explains how our system works. You may also find our online LPA and Wills calculators useful to get an idea of cost.

In the meantime, f you need further advice or guidance, 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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