What is Lasting Power of Attorney?
A Lasting Power of Attorney (LPA) is a legal document which allows someone else to step in and take care of you and your finances if you become unable to do so yourself. This is a situation which can happen any time of life but as we are living longer with age-related illnesses such as dementia and alzheimers it has become an even important part of planning for a secure future.
Background
Lasting powers of attorney (LPAs) in English law were created under the Mental Capacity Act 2005, and came into effect on 1 October 2007. The LPA replaced the former enduring powers of attorney (EPA) which were narrower in scope.
There are two types of Lasting Power of Attorney
Health and Welfare Lasting Power of Attorney
This is the LPA which can be used to give your attorney the power to make decisions about your health and welfare, if and only if, you are unable to take those decisions yourself.
The Health and Welfare LPA covers things like your personal care, ie whether you can wash and dress yourself without help, your medical care, whether you should live at home or in a supported environment and whether or not you should receive life sustaining treatment.
Property and Financial Affairs Lasting Power of Attorney
This gives the person appointed by you as your attorney control over financial decisions if you are unable to do so yourself. The Property and Financial Affairs LPA covers things such as managing your bank account, collecting your benefits or pension, paying your bills and selling your property.
Basically, if you are unable to manage your financial affairs the person who has been appointed your attorney can manage everything on your behalf.You can appoint different people to different roles. However, your Financial Attorney must consult with a professional advisor before they can make decisions on investments. This is to stop them from being reckless with your money.
Why have a Lasting Power of Attorney?
It’s never too early to appoint an attorney to manage your health and affairs. We don’t like to think that bad things might happen but the reality is that you could be affected by alzheimer’s disease or dementia, or suffer the kind of life-changing accident that means you are unable to make decisions like you used to.
The truth is you can’t predict what will happen in your life but what you can do is make decisions now to safeguard your security and ensure loved ones don’t suffer any unnecessary expense or worry should anything happen to you.
You may think that if you had an accident or became unable to make decisions about your finances or health your partner would be able to step in automatically and take over but that is not the case. Without LPA they just won’t have the authority. This could cause untold problems, from trying to free up funds to pay for a place to live, to ensuring that your wishes are carried out in regard to your long-term care.
A Lasting Power of Attorney is something a solicitor can set up for you easily allowing you to grant legal power to someone else to make decisions about your financial situation, medical treatment and other affairs, if you lose the mental capacity to make them yourself.
When does someone lack mental capacity?
If someone can make a decision for themselves, they can be said to have the mental capacity to make that decision. If they aren’t able to make a decision because of some form of mental disability, they can be said to lack the mental capacity to make that decision.
The disability may be either temporary or permanent and could be caused by:
- dementia
- brain injury
- a stroke
- alcohol or drug misuse
- the side-effects of medical treatment
Who benefits from Lasting Power of Attorney?
You:
You, legally known as the Donor, will be the first beneficiary as you will have appointed a person or people who have your best interests at heart. Decisions, for example about your care will be made according to your wishes rather than taken for you by those who don’t know you. It could be that the authorities say it’s best if you live in a care home, even though you wouldn’t wish to. When Lasting Power of Attorney is in place, your wishes can be taken into consideration with the backing of the law.
Your loved ones:
Lasting Power of Attorney can also benefit those closest to you. If you don’t grant someone the ability to manage your money, they won’t be able to do something as simple as draw your pension, ensure you have enough funds in the bank to pay your bills and manage your mortgage. At least, not without a lot of hassle and expense.
Also, when a joint account is restricted it has a severe impact on the other person and as they are unable to freely withdraw what is essentially their own money without an order from the Court of Protection.
This is not something a loved one should have to go through especially if the joint owner has their only form of income, such as their pension, paid into this joint account.
The benefits of Lasting Power of Attorney
You can choose your LPA
When you choose an LPA you are in control of your faculties which means you will be able to choose the right person who will deal with your affairs in accordance with your wishes. This could be your partner, children or a close friend and you can even choose several Attorneys if you wish. For example, if you have two children you may wish them to share the duties of LPA.
Better outcomes for you
Having appointed someone who you trust to make the right decisions for you, you can be assured that the choices made on your behalf will be in accordance with your wishes and not made arbitrarily by a stranger who doesn’t know you. The person you appoint as your LPA will make decisions for you on your behalf, which means that you are likely to get better outcomes.
Less stress
Not setting up an LPA can be stressful for those left to deal with your affairs and for you, if you are unable to express the decisions you wish to be made. If you don’t appoint an LPA your loved ones have to go through the legal process of applying for a Deputyship Order, which can be time-consuming and expensive.
LPAs come into effect when you want them to
If you set up your LPA in advance, it doesn’t have to take effect straight away. In fact it is common for it to be activated when you lack the mental faculties to make your own decisions.
Peace of mind
A Lasting Power of Attorney is one of the most caring and thoughtful steps you can take in ensuring love ones don’t suffer any unneccessary stress should you become incapacitated through an accident or illness.
Can I remove Lasting Power of Attorney?
A Lasting Power of Attorney can be cancelled at any time by the Donor. This is called ‘revoked’ in legal terms, as long as they have the mental capacity to do so. In order to revoke a LPA you need something called a Deed of Revocation form
How to cancel a power of attorney
Before the LPA is cancelled the Deed of Revocation form must be signed by the Donor and the Attorney must be informed that their power to act on behalf of the other person has been revoked.
The authority of the Attorney doesn’t end until they receive notice of the revocation, so they should receive a copy of the Deed of Revocation.
The Attorney must also return the LPA to confirm that the power has been relinquished.If the LPA has already been registered with the Office of the Public Guardian, the Donor must send the OPG a copy of the Deed to ask them to remove the LPA from the register.
Automatic cancellation occurs when:
- The Attorney dies and there is either no replacement Attorney or if there are the Attorneys can only act together
- The Attorney refuses to act by disclaiming the role and there are no other Attorneys (or the Attorneys can only act together) and there is no replacement Attorney.
- The Attorney is married to the Donor (or is the Donor’s civil partner) and the marriage or civil partnership is ended by divorce or dissolution and there are no other Attorneys (or the Attorneys can only act together) and there is no replacement Attorney.
- The Attorney isn’t capable of exercising the LPA and there are no other Attorneys (or the Attorneys can only act together) and there is no replacement Attorney.
- When the Donor or Attorney become bankrupt – this relates to the LPA relating to property and financial affairs.
LPA Costs
Lasting Power of Attorney (LPA) – Cost £200.o0 inclusive of VAT per document.
Expenses/disbursement – £82.00 registration fee per document payable to the Office of the Public Guardian.
You may be eligible for a reduction in the registration fee if you are on a low income or in receipt of any means tested benefits.
