Lasting Powers of Attorney

Most people now realise the importance of making a Will and appointing somebody to look after their estate after they have died. But how many of us prepare for the time when we are no longer mentally capable of handling our financial affairs by appointing someone to do so on our behalf while we are still alive?

Who will do the routine things which you have done all your life, such as paying bills on time, sorting out savings, ensuring that you receive all the benefits to which you are entitled and getting money from the bank when you need it?

From 1st October 2007, you can make a Power of Attorney called a Lasting Power of Attorney (LPA).   This Power gives the attorney authority to act on your behalf.

There are two types of LPA, namely a Property & Affairs LPA, which allows your attorney to deal with your property and finances as you specify, and a Welfare LPA which allows your attorney to make welfare and health care decisions on your behalf. This could also extend, if you wished, to giving or refusing consent to the continuation of life-sustaining treatment.

It is a very important document and the person you appoint should be trustworthy and have the appropriate skills to make the necessary decisions. You can appoint more than one attorney to act together (jointly) or together or separately (jointly and severally). You may also choose to appoint a successor to your attorneys in case they die or otherwise cannot act for you.

The attorney will only be able to act when the document has been signed by both you and your attorney and certified by a certificate provider who will be confirming that you understand the nature of the Power of Attorney, that there has been no pressure placed upon you and that you are mentally capable of signing the document. This certificate provider could either be a good friend or a professional, for example, a solicitor or GP. 

The document must then be registered with the Office of the Public Guardian before it can be used. The Property & Affairs LPA can be used both when you have capacity to act as well as if you can no longer make financial decisions. The Welfare LPA can only be used if you lack the mental capacity to make welfare or medical decisions.

If you already hold an Enduring Power of Attorney, validly made before 1st October 2007, this can still be used. However, an Enduring Power of Attorney gives no authority in respect of health and welfare decisions and you may want to consider making a Welfare LPA.

If you do not have an Enduring Power of Attorney or Lasting Power of Attorney in place, then instead of a simple registration procedure, a formal application to the Court must be made in the event of you becoming mentally incapable of managing your affairs. The Court will appoint a Deputy to look after your affairs who would normally be a relative or close friend. The Court proceedings will be lengthy, complicated and expensive, and cause anxiety and inconvenience to your relatives. It is therefore most important that you consider setting up a Lasting Power of Attorney rather than relying on the appointment of a Deputy.