Most people acknowledge that it is important to organise their affairs in the event of their death, but do not always make the same provision for issues arising during their lifetime.
A Lasting Power of Attorney “LPA” gives people you trust, usually close relatives or friends, the power to act on your behalf, if you are unable to do so yourself because of an accident, illness or loss of mental or physical capacity.
Putting LPAs in place now (before they are needed) puts you firmly in control of your affairs as you decide exactly how much authority your ‘Attorney’ would have and whether you want to impose any restrictions. There are safeguards to make sure that your wishes are carried out and the person acting on your behalf recognises the seriousness of their responsibility. A Lasting Power of Attorney can only be prepared if you have mental capacity.
There are two types of Lasting Power of Attorney: –
- LPA for Property & Financial Affairs; allows the person(s) appointed to make decisions for the Donor (you) about paying bills, dealing with savings and investments, arranging and collecting benefits and even selling property on your behalf. This could also allow persons of your choosing to
- LPA for Health and Welfare; allows the person(s) appointed to make decisions for the Donor on personal matters such as care, where you live as well, as decisions regarding medical and life sustaining treatment.
For your own protection, neither document can be used until it is registered with the Office of the Public Guardian and the Health & Welfare cannot be used unless you have lost capacity.
What happens if I do not have Lasting Powers of Attorney?
An application has to be made to the Court of Protection for a Deputyship Order. There are three main problems; delays, cost and possible loss of control over your affairs.
This process can cost £2,000 to £3,000 and can take up to 9-12 months. During that time your bank accounts may be frozen.
A Judge will make the final decision as to who is appointed to deal with your affairs, which may not be the person you would have chosen. This person is called a Deputy and whilst it may be a family member or friend, it could also be a legal professional or other third party. This could mean that those seeking to care for you, such as your family have the added stress of dealing with Court appointed officials every time a decision is needed. They could also have no official say in any medical treatment for you, even if they knew what your wishes would be.
The Court of Protection’s job is to safeguard the interests of people who no longer have the capacity to make decisions for themselves. If you want to be sure that your loved ones have the power to care for you and be able to make decisions on your behalf, then you need to have Lasting Powers of Attorney in place.
Business Owners
A lasting powers of attorney also allows the donor (the business owner) to appoint a suitable attorney to make decisions concerning their business interests when they are unavailable or lack mental capacity.
If there is no business LPA in place, certain risks arise. For instance, if one of the bank account signatories lacks capacity the bank can freeze the account to protect the now vulnerable adult. If there is an overdraft, the possibility of the bank freezing the account is greater.
As mentioned above, If there is no LPA in place an application should be made to the Court of Protection to have a deputy appointed. This may take several months, during which time the business is exposed to uncertainty of survival.
How to arrange your LPA’s
Whilst it is possible to complete these yourself online through the government’s website, most people prefer to get advice and help to ensure they are completed correctly.
We can help you with this and have arranged many LPA’s for our clients and their families. Please get in touch if you would like further information on this service.