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The Mental Capacity Act 2005

The Mental Capacity Act 2005, which fully came into force on 1 October 2007, provides a detailed framework for all areas of decision making where people lack the capacity to make those decisions for themselves. At the same time it sets out the means for those who may lack capacity in the future to plan for this.

One of the major changes introduced by the Act, which has attracted significant publicity, is the replacement of Enduring Powers of Attorney (EPAs) with new Lasting Powers of Attorney (LPAs). EPAs enabled Donors to appoint Attorneys to make financial decisions on their behalf. They could do so at the Donor’s request prior to losing capacity (if the need arose) or, more importantly, after losing such capacity. LPAs replaced EPAs on 1 October 2007, with EPAs already in existence before that date remaining valid.

Whilst the objectives of the LPA and EPA remain the same, there are some marked differences between the two:

= There are two different forms of LPA, one dealing with property issues and the other with welfare. The property and affairs LPA is much like the EPA in that the Donor can delegate decisions about their finances. However, the personal welfare LPA is an entirely new concept whereby an individual can delegate decisions about their health and welfare, which can include whether to give or refuse consent to life saving treatment.

= The EPA can be used with the consent of the Donor as soon as it has been signed, and needs to be registered only if the Donor is losing or has lost mental capacity. However, both types of LPA must be registered with the Court of Protection before they can be used. The LPA dealing with health and welfare decisions can only be used once the Donor has lost mental capacity.

= The fee for registering each LPA document is £150, as opposed to the £120 EPA registration fee.

= The LPA forms are considerably longer and more detailed than the EPA form.

= Once the LPA has been signed by the Donor and his Attorneys there is an additional requirement that a third party (known as the “Certificate Provider”) must certify that the Donor has understood the document he is signing, has not been subject to undue pressure or fraud and that there is no other reason to prevent the creation of the instrument.

There has been much controversy over the introduction of LPAs. Some regard the new property and affairs LPA as more thorough than the EPA and offering greater safeguards against potential financial abuse. The alternative view is that it is unnecessarily bureaucratic and adds to the cost of what was a relatively straightforward and inexpensive procedure. Nevertheless, the extension of the legislation to cover personal and welfare decisions is a new development, the effectiveness of which only time and practice will establish.

What is clear, at this early stage, is that it will now be more difficult to delegate authority to an Attorney to manage one’s affairs, both property and welfare, without seeking professional guidance.

For further enquiries please contact Stuart Goodbody (view full profile) on 01892 510000 or email stuart.goodbody@ts-p.co.uk.

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