Lasting Power of Attorney

Allowing someone to make decisions for you, or act on your behalf

A Lasting Power of Attorney (LPA) enables individuals to take control of decisions that affect them, even in the event that they can’t make those decisions for themselves. Without an LPA, loved ones could be forced to endure a costly and lengthy process to obtain authority to act for an individual who has lost mental capacity.

An individual can create a LPA covering their property and financial affairs and/or a separate LPA for their health and welfare. It’s possible to appoint the same or different attorneys in respect of each LPA, and both versions contain safeguards against possible misuse.

Own Financial Affairs

It’s not hard to imagine the difficulties that could arise where an individual loses the capacity to manage their own financial affairs and,  without access to their bank account, pension and investments, family and friends could face an additional burden at an already stressful time. LPA and their equivalents in Scotland and Northern Ireland should be a consideration in all financial planning discussions and should be a key part of any protection insurance planning exercise. Planning for mental or physical incapacity should sit alongside any planning for ill health or unexpected death.

Losing mental capacity

Commencing from 1 October 2007, it is no longer possible to establish a new Enduring Power of Attorney (EPA) in England and Wales, but those already in existence remain valid. The attorney would have been given authority to act in respect of the donor’s property and financial affairs as soon as the EPA was created.

At the point the attorney believes the donor is losing their mental capacity, they would apply to the Office of the Public Guardian (OPG) to register the EPA to obtain continuing authority to act.

Similar provisions in Scotland

Similar provisions to LPAs apply in Scotland. The ‘granter’ (donor) gives authority to their chosen attorney in respect of their financial and property matters (‘Continuing Power of Attorney’) and/or personal welfare (‘Welfare Power of Attorney’).

The latter only takes effect upon the granter’s mental incapacity. Applications for powers of attorney must be accompanied by a certificate confirming the granter understands what they are doing, completed by a solicitor or medical practitioner only.

LPAs don’t apply to Northern Ireland. Instead, those seeking to make a power of attorney appointment over their financial affairs would complete an EPA. This would be effective as soon as it was completed and would only need to be registered in the event of the donor’s loss of mental capacity with the High Court (Office of Care and Protection).

Concerning medical treatment

It’s usual for the attorney to be able to make decisions about the donor’s financial affairs as soon as the LPA is registered. Alternatively, the donor can state it will only apply where the donor has lost mental capacity in the opinion of a medical practitioner.

A LPA for health and welfare covers decisions relating to an individual’s day-to-day well-being. The attorney may only act once the donor lacks mental capacity to make the decision in question. The types of decisions covered might include where the donor lives and decisions concerning medical treatment.

Life-sustaining treatment

The donor also has the option to provide their attorney with the authority to give or refuse consent for life-sustaining treatment. Where no authority is given, treatment will be provided to the donor in their best interests.

Unlike the registration process for an EPA, registration for both types of LPA takes place up front and is not dependent on the donor’s mental capacity. An attorney must act in the best interest of the donor, following any instructions and considering the donor’s preferences when making decisions.

They must follow the Mental Capacity Act Code of Practice which establishes five key principles:

1. A person must be assumed to have capacity unless it’s established he or she lacks capacity.
2. A person isn’t to be treated as unable to make a decision unless all practicable steps to help him or her do so have been taken without success.
3. A person isn’t to be treated as unable to make a decision merely because he or she makes an unwise decision.
4. An act done, or decision made, under the Act for or on behalf of a person who lacks capacity must be done, or made, in his or her best interests.
5. Before the act is done, or the decision is made, regard must be had to whether the purpose for which it’s needed can be as effectively  achieved in a way that is less restrictive of the person’s rights and freedom of action.

Legally binding duties

A donor with mild dementia might be provided with the means to purchase items for daily living, but otherwise their financial matters are  undertaken by their attorney. The code of practice applies a number of legally binding duties upon attorneys, including the requirement to keep the donor’s money and property separate from their own or anyone else’s.

Anyone aged 18 or over who has mental capacity and isn’t an undischarged bankrupt may act as an attorney. A trust corporation can be an attorney for a property and financial affairs LPA. In practice, attorneys will be spouses, family members or friends, or otherwise professional contacts such as solicitors.

Replacement attorney

Where joint attorneys are being appointed, the donor will state whether they act jointly (the attorneys must make all decisions together), or jointly and severally (the attorneys may make joint decisions or separately), or jointly for some decisions (for example, the sale of the donor’s property) and jointly and severally in respect of all other decisions.

An optional but useful feature of the LPA is the ability to appoint a replacement attorney in the event the original attorney is no longer able to act. The donor can leave instructions and preferences, but if they don’t their attorney will be free to make any decisions they feel are correct. Instructions relate to things the attorney should or shouldn’t do when making decisions – not selling the donor’s home unless a doctor states the donor can no longer live independently or a particular dietary requirement would be examples.

‘Certificate provider’

Preferences relate to the donor’s wishes, beliefs and values they would like their attorney to consider when acting on their behalf. Examples might be ethical investing or living within close proximity of a relative.

The following apply to both forms of LPA. A ‘certificate provider’ must complete a section in the LPA form stating that as far as they are aware, the donor has understood the purpose and scope of the LPA. A certificate provider will be an individual aged 18 or over and either, someone who has known the donor personally well for at least two years; or, someone chosen by the donor on account of their professional skills and expertise – for example, a GP or solicitor.

Concerns or objections

There are restrictions on who may act as a certificate provider – these include attorneys, replacement attorneys, family members and business associates of the donor. A further safeguard is the option for the donor to choose up to five people to be notified when an application for the LPA to be registered is being made.

This allows any concerns or objections to be raised before the LPA is registered, which must be done within five weeks from the date on which notice is given. The requirement to obtain a second certificate provider where the donor doesn’t include anyone to be notified has now been removed as part of the Office of the Public Guardian (OPG) review of LPAs.

Court of protection

A person making a LPA can have help completing it, but they must have mental capacity when they fill in the forms. Otherwise, those seeking to make decisions on their behalf will need to apply to the Court of Protection for a deputyship order. This can be expensive and time consuming and may require the deputy to submit annual reports detailing the decisions they have made.

There are strict limits on the type of gifts attorneys can make on the donor’s behalf. Gifts may be made on ‘customary occasions’, for example, birthdays, marriages and religious holidays, or to any charity to which the donor was accustomed to donating. Gifts falling outside of these criteria would need to be approved by the Court of Protection. An example would be a gift intended to reduce the donor’s Inheritance Tax liability.

For more help and guidance on Lasting Powers of Attorney, please get in touch.

Lasting Powers of Attorney (LPA)

Setting up an LPA is vital to ensure that you have a trusted individual who can manage your affairs when you are no longer able to do so yourself

• 33% of of UK adults know how to use an LPA effectively, despite the fact that 95% of UK adults are aware of LPAs
• 37% of Britons have put an LPA in place, despite the fact that 74% deem LPAs necessary
• 41% of married couples have put in place an LPA, but 24% have no plans for doing so

Lasting Powers of Attorney (LPA)

Setting up an LPA is vital to ensure that you have a trusted individual who can manage your affairs when you are no longer able to do so yourself

• 33% of of UK adults know how to use an LPA effectively, despite the fact that 95% of UK adults are aware of LPAs
• 37% of Britons have put an LPA in place, despite the fact that 74% deem LPAs necessary
• 41% of married couples have put in place an LPA, but 24% have no plans for doing so

Putting a Lasting Power of Attorney in place whilst you have full capacity to make your own choices and decisions gives:

• Both you and your family clarity
• The ability to take action
• Complete peace of mind

For more help and guidance on creating a Lasting Power of Attorney, please get in touch.

Allowing someone to make decisions for you, or act on your behalf

A Lasting Power of Attorney (LPA) enables individuals to take control of decisions that affect them, even in the event that they can’t make those decisions for themselves. Without an LPA, loved ones could be forced to endure a costly and lengthy process to obtain authority to act for an individual who has lost mental capacity.

An individual can create a LPA covering their property and financial affairs and/or a separate LPA for their health and welfare. It’s possible to appoint the same or different attorneys in respect of each LPA, and both versions contain safeguards against possible misuse.

Own Financial Affairs

It’s not hard to imagine the difficulties that could arise where an individual loses the capacity to manage their own financial affairs and,  without access to their bank account, pension and investments, family and friends could face an additional burden at an already stressful time. LPA and their equivalents in Scotland and Northern Ireland should be a consideration in all financial planning discussions and should be a key part of any protection insurance planning exercise. Planning for mental or physical incapacity should sit alongside any planning for ill health or unexpected death.

Losing mental capacity

Commencing from 1 October 2007, it is no longer possible to establish a new Enduring Power of Attorney (EPA) in England and Wales, but those already in existence remain valid. The attorney would have been given authority to act in respect of the donor’s property and financial affairs as soon as the EPA was created.

At the point the attorney believes the donor is losing their mental capacity, they would apply to the Office of the Public Guardian (OPG) to register the EPA to obtain continuing authority to act.

Similar provisions in Scotland

Similar provisions to LPAs apply in Scotland. The ‘granter’ (donor) gives authority to their chosen attorney in respect of their financial and property matters (‘Continuing Power of Attorney’) and/or personal welfare (‘Welfare Power of Attorney’).

The latter only takes effect upon the granter’s mental incapacity. Applications for powers of attorney must be accompanied by a certificate confirming the granter understands what they are doing, completed by a solicitor or medical practitioner only.

LPAs don’t apply to Northern Ireland. Instead, those seeking to make a power of attorney appointment over their financial affairs would complete an EPA. This would be effective as soon as it was completed and would only need to be registered in the event of the donor’s loss of mental capacity with the High Court (Office of Care and Protection).

Concerning medical treatment

It’s usual for the attorney to be able to make decisions about the donor’s financial affairs as soon as the LPA is registered. Alternatively, the donor can state it will only apply where the donor has lost mental capacity in the opinion of a medical practitioner.

A LPA for health and welfare covers decisions relating to an individual’s day-to-day well-being. The attorney may only act once the donor lacks mental capacity to make the decision in question. The types of decisions covered might include where the donor lives and decisions concerning medical treatment.

Life-sustaining treatment

The donor also has the option to provide their attorney with the authority to give or refuse consent for life-sustaining treatment. Where no authority is given, treatment will be provided to the donor in their best interests.

Unlike the registration process for an EPA, registration for both types of LPA takes place up front and is not dependent on the donor’s mental capacity. An attorney must act in the best interest of the donor, following any instructions and considering the donor’s preferences when making decisions.

They must follow the Mental Capacity Act Code of Practice which establishes five key principles:

1. A person must be assumed to have capacity unless it’s established he or she lacks capacity.
2. A person isn’t to be treated as unable to make a decision unless all practicable steps to help him or her do so have been taken without success.
3. A person isn’t to be treated as unable to make a decision merely because he or she makes an unwise decision.
4. An act done, or decision made, under the Act for or on behalf of a person who lacks capacity must be done, or made, in his or her best interests.
5. Before the act is done, or the decision is made, regard must be had to whether the purpose for which it’s needed can be as effectively  achieved in a way that is less restrictive of the person’s rights and freedom of action.

Legally binding duties

A donor with mild dementia might be provided with the means to purchase items for daily living, but otherwise their financial matters are  undertaken by their attorney. The code of practice applies a number of legally binding duties upon attorneys, including the requirement to keep the donor’s money and property separate from their own or anyone else’s.

Anyone aged 18 or over who has mental capacity and isn’t an undischarged bankrupt may act as an attorney. A trust corporation can be an attorney for a property and financial affairs LPA. In practice, attorneys will be spouses, family members or friends, or otherwise professional contacts such as solicitors.

Replacement attorney

Where joint attorneys are being appointed, the donor will state whether they act jointly (the attorneys must make all decisions together), or jointly and severally (the attorneys may make joint decisions or separately), or jointly for some decisions (for example, the sale of the donor’s property) and jointly and severally in respect of all other decisions.

An optional but useful feature of the LPA is the ability to appoint a replacement attorney in the event the original attorney is no longer able to act. The donor can leave instructions and preferences, but if they don’t their attorney will be free to make any decisions they feel are correct. Instructions relate to things the attorney should or shouldn’t do when making decisions – not selling the donor’s home unless a doctor states the donor can no longer live independently or a particular dietary requirement would be examples.

‘Certificate provider’

Preferences relate to the donor’s wishes, beliefs and values they would like their attorney to consider when acting on their behalf. Examples might be ethical investing or living within close proximity of a relative.

The following apply to both forms of LPA. A ‘certificate provider’ must complete a section in the LPA form stating that as far as they are aware, the donor has understood the purpose and scope of the LPA. A certificate provider will be an individual aged 18 or over and either, someone who has known the donor personally well for at least two years; or, someone chosen by the donor on account of their professional skills and expertise – for example, a GP or solicitor.

Concerns or objections

There are restrictions on who may act as a certificate provider – these include attorneys, replacement attorneys, family members and business associates of the donor. A further safeguard is the option for the donor to choose up to five people to be notified when an application for the LPA to be registered is being made.

This allows any concerns or objections to be raised before the LPA is registered, which must be done within five weeks from the date on which notice is given. The requirement to obtain a second certificate provider where the donor doesn’t include anyone to be notified has now been removed as part of the Office of the Public Guardian (OPG) review of LPAs.

Court of protection

A person making a LPA can have help completing it, but they must have mental capacity when they fill in the forms. Otherwise, those seeking to make decisions on their behalf will need to apply to the Court of Protection for a deputyship order. This can be expensive and time consuming and may require the deputy to submit annual reports detailing the decisions they have made.

There are strict limits on the type of gifts attorneys can make on the donor’s behalf. Gifts may be made on ‘customary occasions’, for example, birthdays, marriages and religious holidays, or to any charity to which the donor was accustomed to donating. Gifts falling outside of these criteria would need to be approved by the Court of Protection. An example would be a gift intended to reduce the donor’s Inheritance Tax liability.

For more help and guidance on Lasting Powers of Attorney, please get in touch.

Lasting Power of Attorney for Health and Welfare can generally make decisions about matters including:

• Where you should live
• Your medical care
• What you should eat
• Whom you should have contact with
• What kind of social activities you should take part in

Lasting Power of Attorney for Property and Financial Affairs decisions can cover:

• Buying and selling property
• Paying the mortgage
• Investing money
• Paying bills
• Arranging repairs to property

Giving someone you trust the authority to help you make decisions

As someone becomes more unwell, they’re likely to and it more difficult to manage money and financial affairs, and may become too unwell to make decisions about health and care. A Lasting Power of Attorney (LPA) is a legal document in which someone (the donor) gives another person (the attorney) the right to help them make decisions, or take decisions on their behalf.

An LPA is a completely separate legal document to your Will, although many people put them in place at the same time as getting their Will written as part of wanting to plan for the future. Many people find it reassuring to know that someone they trust will be able to make decisions on their behalf if they become too unwell.

During your lifetime

Once you have an LPA in place, you can have peace of mind that there is someone you trust to look after your affairs if you became unable to do so yourself during your lifetime. This may occur, for example, because of an illness, old age or an accident.

Having an LPA in place can allow your attorney to have authority to deal with your finances and property as well as make decisions about your health and welfare. Your LPA can include binding instructions together with general preferences for your attorney to consider. Your LPA should reflect your particular wishes so you know that the things that matter most would be taken care of.

Required legal capacity

You can only put an LPA in place while you are capable of understanding the nature and effect of the document, for example, you have the
required legal capacity. After this point, you cannot enter into a LPA and no one can do so on your behalf.

Many people don’t know that their next of kin has no automatic legal right to manage their spouse’s affairs without an LPA in place, so having to make decisions on their behalf can become prolonged and significantly more expensive. In England and Wales there are two types of Lasting Power of Attorney.

Lasting Power of Attorney for Health and Welfare can generally make decisions about matters including:

• where you should live
• your medical care
• what you should eat
• whom you should have contact with
• what kind of social activities you should take part in

You can also give special permission for your attorney to make decisions about life-saving treatment.

Lasting Power of Attorney for Property and Financial Affairs decisions can cover:

• buying and selling property
• paying the mortgage
• investing money
• paying bills
• arranging repairs to property

Manage your affairs

Without an LPA in place there is no one with the legal authority to manage your affairs, for example, to access bank accounts or investments in your name or sell your property on your behalf. Unfortunately, many people assume that their spouse, partner or children will just be able to take care of things but the reality is that simply isn’t the case.

In these circumstances, in order for someone to obtain legal authority over your affairs, that person would need to apply to the Court of Protection and the Court will decide on the person to be appointed to manage your affairs. The person chosen is appointed your ‘Deputy’.
This is a very different type of appointment, which is significantly more involved and costly than being appointed attorney under an LPA.

If you wish to have peace of mind that a particular person will have the legal authority to look after your affairs and you want to make matters easier for them and less expensive, then you should obtain professional advice about putting in place an LPA.

Health and Welfare Lasting Power of Attorney

Allows you to name attorneys to make decisions about your healthcare, treatments and living arrangements if you lose the ability to make those decisions yourself. Unlike the Property and Financial Affairs LPA, this document will only ever become effective if you lack the mental capacity to make decisions for yourself.

If you can’t communicate your wishes, you could end up in a care home when you may have preferred to stay in your own home. You may also receive medical treatments or be put into a nursing home that you would have refused if only you had the opportunity to express yourself; and this is when your attorney, appointed by the LPA, can speak for you.

Property and Financial Affairs Lasting Power of Attorney

Allows you to name attorneys to deal with all your property and financial assets in England and Wales. $e LPA document can be restricted
so it can only be used if you were to lose mental capacity, or it can be used more widely, such as if you suffer from illness, have mobility issues or if you spend time outside the UK.

Protecting you and your family should the worst happen

Do you need help managing the financial affairs or health decisions of a relative? Are you concerned that failing health may leave you incapable of managing your own finances and general wellbeing? Arranging a Lasting Power of Attorney could be used to protect you and your family should the worst happen. To find out more, please contact us.

This guide has been designed to assist you with some of the general issues and to answer questions that you may have. This guide is only intended to be a general overview of the law in England and Wales in relation to Lasting Powers of Attorney. While every effort has been made to ensure this guide’s accuracy, it doesn’t constitute legal advice. If you act on it, you acknowledge that you do so at your own risk. Professional legal advice should always be obtained.