Losing the mental capacity to make sound decisions about aspects of our own lives is not something any of us like to think about happening. But it is important to plan for the future as if this scenario occurs without any guidance as to your wishes in relation to decision-making it can be difficult for loved ones to help.
A Lasting Power of Attorney (LPA) is the best way to ensure that those people you would want to make decisions for you have the authority to do so.
Following a recent survey conducted by consumer campaign group Which? It has been revealed that there are significant gaps in public understanding of the power of attorney system.
The poll of 2,000 UK residents found that many people showed a poor understanding of how LPAs work.
Fiona Bushell, Solicitor at Irwin Mitchell discusses the importance of LPAs and why you might need one.
What is a power of attorney and why would you need one?
An LPA is a legal document that gives an individual (“a donor”) an opportunity to choose a person or people they trust (“attorneys”) to make decisions on the donor’s behalf if he or she loses mental capacity. There are two types of LPA – one for Property and Financial Affairs and one for Health and Welfare. Anyone over 18 who has mental capacity can make an LPA.
What does ‘mental capacity’ mean?
Mental capacity means you are able to understand and make decisions for yourself. You may be able to make decisions about some things but not others. For the purpose of making an LPA you must understand the process of making an LPA, why you are making it and the likely outcome.
What powers does it grant you?
Each LPA “does what it says on the tin”. A Property and Financial Affairs LPA means an attorney can deal with any decisions regarding the donor’s property and finances, including things such as managing buying and selling the donor’s property, paying household bills and managing the donor’s bank account. It is possible for a donor to restrict the types of decisions an attorney can make or the donor can give the attorney authority to make all financial decisions on the donor’s behalf.
A Health and Welfare LPA means an attorney can make health and care decisions such as whether a particular medical procedure is performed, what medication is administered and what residential care setting the donor lives in. As with the financial LPA, it is possible for a donor to restrict the types of decisions an attorney can make or give the attorney authority to make all decisions on the donor’s behalf. In particular with the Health and Welfare LPA, it is possible for a donor to give the attorneys special permission to make decisions about life-saving treatment.
What can’t you do?
An attorney can only act in accordance with the power they have been granted by the LPA. Therefore, if the donor has limited the attorney’s power in any way, it follows that the attorney can only act within the constraints of those limitations. For example, if a donor does not give a Health and Welfare attorney the power to make decisions about life-sustaining treatment then the attorney cannot take those decisions.
An attorney cannot use a financial LPA to make a Will on a donor’s behalf. If a donor has lost capacity and the attorney feels that the donor requires a new Will, they must make an application to the Court of Protection. The Court of Protection would then decide if a “Statutory Will” was required.
At all times the attorney has a legal duty to act in the best interests of the donor.
How do you apply for one – what does the process look like?
After the donor, certificate provider and attorney have all signed the LPA in the presence of a witness it should be submitted to the Office of the Public Guardian (OPG) who will proceed to register the LPA. Once registered, they will return it to the donor (or whoever the donor chooses to receive the registered LPA) so that it can be used as necessary. The LPA cannot be used until it is registered.
How much does it cost?
You can prepare and register your own LPAs, however the documents are complicated, therefore it’s advisable to have a solicitor help you.
The OPG have to be very particular about the order in which the documents are signed (to ensure that the donor understands what authority they are giving to the attorneys and the attorneys understand what responsibilities they are agreeing to undertake) therefore a significant percentage of LPAs they receive are rejected and cannot be registered. Using a solicitor ensures that the LPAs are accepted by the OPG and registered for use as soon as possible.
How long does it last?
An LPA lasts from registration until the donor dies or revokes the LPA or when all the attorneys and replacement attorneys have died. It is therefore important to choose attorneys who will hopefully survive the lifetime of the donor as, if there are no living attorneys or replacement attorneys, the LPA can no longer be used.
What’s an enduring power of attorney?
Enduring powers of attorney (EPAs) were replaced by LPAs in October 2007. However, if you signed an EPA before 1 October 2007, it should still be valid. An EPA deals with decisions only about your property and financial affairs (i.e. not health and welfare decisions). Similar to an LPA, it can be used by the attorney while the donor retains capacity or after they have lost capacity (provided it is registered).
How many attorneys can you have and does it need to be someone in your family?
There is no limit on the number of attorneys a donor can appoint; however, the more attorneys are appointed, the more administratively unworkable the LPA may become. We recommend choosing between one and four people to act as your attorneys at any one time. If you only appoint one or two “first choice” attorneys it is sensible to appoint at least one replacement. Your attorneys don’t have to be family members – just anybody you trust to look after your finances or health and care and act in your best interests.
Can you make changes to one or cancel one if it’s no longer needed?
The changes a donor can make to an LPA once it is registered are limited and any amendments would need to be communicated to the OPG. If you simply want to remove one of your attorneys but wish your other attorneys’ appointments to remain valid you would need to partially revoke your LPA. If you wanted to remove all your attorneys or “cancel” your LPA (to either make a new one or leave yourself without a valid LPA) you would need to revoke your LPA. The OPG requires particular wording to be used for any revocation.
It is not possible to add further attorneys to your LPA once it is registered so it is important to think carefully about you would wish to appoint in the first instance and as replacements. In order to appoint new attorneys, the donor would need to revoke the existing LPA and register a new one.
What if the person no longer has capacity – what can you do under those circumstances?
If someone has already lost mental capacity then it is not possible for them to execute an LPA. Instead, an application would need to be made to the Court of Protection for something called a “Deputyship”. This can be a long and expensive process which is why we always recommend executing LPAs while the donor retains mental capacity.