Understanding Lasting Powers of Attorney

There are many misunderstandings and misconceptions about Lasting Powers of Attorney (LPA), therefore we hope this provides a useful overview of what an LPA does, how it works and how to request one.

5 reasons to have an LPA:-

1. One in three people aged over 65 will develop dementia, so it is important to ensure that finances and health will be looked after if you can’t deal with those matters yourself.
2. If you lose mental capacity and do not have an LPA no one can access your bank accounts to pay for your care or your bills without involving the court.
3. You get to choose who can make decisions for you when you are unable to do so. Your next of kin can’t automatically make decisions for you and if you don’t have an LPA, the court may need to appoint someone to act for you.
4. If no one can operate your bank accounts it might leave your family vulnerable, even when trying to pay for something as simple as a household bill, as Kate Garraway has found following her husband Derek Draper having to be put in an induced coma after contracting Covid-19.
5. You can clearly state your wishes such as the circumstances in which you would want your home to be sold or types of medical treatment you would not wish to receive.

What is a Lasting Power of Attorney (LPA)?

An LPA is a legal document by which you (the donor) give authority to others (your attorneys) to act for you and make decisions on your behalf when you are unable to make those decisions yourself. This might be because you have dementia or because you are in a coma following a bad accident for example.

There are two types of LPA:

1. Property and financial affairs. This covers matters such as paying bills, buying and selling property and managing your investments.
2. Health and welfare. This covers decisions around your care and medical treatment.

Who can be your attorney?

Anyone over the age of 18 who has mental capacity can be your attorney. You can appoint more than one attorney. You can also appoint replacement attorneys who step in if your original attorneys become unable to act for you.

When can an LPA be used?

LPAs must be registered with the Office of the Public Guardian before they can be used.

When making a property & financial affairs LPA you can specify that your attorneys can act for you only if you don’t have mental capacity. Alternatively, you can allow your attorneys to act for you, with your consent, even when you do have capacity. This second option can be helpful if you are physically incapacitated, perhaps because you are in hospital, and you need someone to go to the bank for you.

Your health and welfare LPA can only ever be used when you do not have mental capacity.

How will my attorneys know how I want them to act?

You can set out instructions and preferences in your LPA. We can work with you to help put this information together.

Instructions are legally binding on your attorneys so that they have to act in a certain way. For example, you can require your attorneys to obtain financial advice before making investments over a certain amount.

Preferences are wishes. Your attorneys do not need to follow these, but they provide useful guidance. You could set out a preference that you would wish so far as is possible to receive care at home rather than moving to residential care, for example.

How do you put an LPA in place?

Firstly, the LPA form needs to be filled in. The form is quite lengthy and, if not completed correctly, it can be rejected at registration by the Office of the Public Guardian. You can request we put together an LPA for you at any time, simply contact Claire-Louise in the Wealth Management team on either clsmith@pearsonhards.co.uk  or call us on 020 8949 9500.

Once it has been filled in, it needs to be signed by you as the donor. A “certificate provider” also needs to sign. Their role is to confirm that you understand what you are doing by putting the LPA in place and that you are not being pressurised to do so. The certificate provider can be a professional such as a solicitor or health care professional, or someone who has known you personally for at least two years. After that, your attorneys need to sign the LPA.

Once everyone has signed the LPA it can be submitted to the Office of the Public Guardian to be registered. There is a registration fee of £82 per LPA. It is then ready to be used at the appropriate time.

For more information about Lasting Powers of Attorney or assistance in putting one in place, please contact Claire-Louise on clsmith@pearsonhards.co.uk or call us on 020 8949 9500.