A Lasting Power of Attorney (LPA) is a document which is put in place to allow you to appoint one or more people to deal with your affairs if you are unable to for some reason.
Previously this was managed via an Enduring Power of Attorney (EPA). If you already have an EPA and it was registered before 1 October 2007, you can continue to use this although it is only valid for decisions relating to property and finance.
A Lasting Power of Attorney (LPA) is designed to cover the full range of decisions someone may need to make if you are unable to. Enduring Powers of Attorney (EPA), whilst still valid if executed correctly and before October 2007, only cover property and finance decisions, although often financial institutions can have issues with them as there is no requirement for them to registered with the Office of the Public Guardian until the donor has lost capacity. A donor is the individual who is giving authority to one or more attorneys to act on their behalf in an LPA or EPA. LPAs are much more widely recognised and are registered on completion so are ready to be used as and when they are needed.
There are two types of LPA: Health and Welfare LPA and Property and Financial Affairs LPA. The first will allow for decisions such as medical care, care in other settings such as care homes and end of life treatments. This can only be used when the individual is unable to make their own decisions. A Property and Financial Affairs LPA will include management of bank accounts, payment of bills and issues relating to property including a sale if needed. This type of LPA can be used immediately or when needed once registered with the Office of the Public Guardian.
We highly recommend that client have both types of LPA and most people will look to do this at the same time as putting their Will in place.
If you are a business owner, it is also worth considering putting an LPA in place which would deal with your business affairs should you be incapacitated, either for a short time or more permanently. For more information, visit our support for Family and Owner Managed Businesses.
If you do not have a valid LPA/EPA in place for financial affairs, your loved one will need to make an application to the Court of Protection for a Deputy Order.
If you do not have an LPA for health and welfare, any decision relating to your personal welfare will be governed by the Mental Capacity Act rather than your family. Applications to the Court of Protection can be lengthy and costly however, having a properly executed and registered LPA in place will allow your family to make these decisions on your behalf. Click here for more information on the specialist support we can provide for vulnerable clients.
Our team regularly advise clients in relation to Wills and LPAs and will guide you through the process. In order to put LPAs in place you will need to decide on who you would like your attorneys to be for each type of LPA and we can then submit your application. There is a fee involved as well as a five week statutory waiting period in case any objections are raised. After this point the Office of the Public Guardian will process the registration of the document.
Should you need to cancel an LPA, this can be done at any point, providing you have the capacity to do so. An LPA will automatically be cancelled on the death of the donor (the individual who the LPA is for). An appointment of an attorney will automatically cancelled on the death/bankruptcy of an attorney, or divorce if the attorney and donor were married. The Court of Protection may also cancel an LPA if they consider that the attorney is not acting properly and in the best interests of the donor. We are able to provide support for vulnerable client and have a great deal of experience in this area. For more information, click here.
Different processes apply for registering and cancelling an EPA and a member of the BPE team can advise you on this to ensure that it is the correct approach.
Depending on the type of LPA they are appointed under, an attorney is given the right to make decisions on either the donor’s health and welfare or their financial and property affairs.
As an attorney you must maintain a duty of care to the donor at all times. This includes keeping all monies separate and maintaining accounts to demonstrate your actions as an attorney. You must also be able to justify that all decisions you take are in the best interests of the donor or risk being removed from the LPA.
If a donor has specified certain courses of action they would like to follow in certain scenarios, providing they have written these down whilst they had capacity, these wishes should be followed. An example of this would be someone stipulating that they do not want future medical treatment.
We would always recommend reviewing an LPA if there are significant changes in your circumstances of that of your attorney(s).
You should double check that you are still happy with the attorneys that you have chosen and that they are still capable. You may have appointed an attorney who is now unable to deal with your affairs or with whom you have lost contact.
Reviewing and amending an LPA needs to be done correctly. A member of the BPE Private Wealth team can advise you as to whether you will need a Deed of Revocation to remove one or more attorneys or whether it may need to be cancelled completely and a new LPA put in place.
How this is done will also depend on how the original document was drawn up so taking legal advice here is very important.
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