What is a Lasting Power of Attorney?

22/11/2010

By Mary Robinson, Associate in Wills, Trusts & Tax Planning and Mental Capacity.

The Mental Capacity Act 2005 came into effect in October 2007 introducing Lasting Powers of Attorney (LPA). There are two types:

  • property and financial affairs LPAs deal with financial matters and replace Enduring Powers of Attorney (EPAs), although an EPA made before 1 October 2007 remains valid
  • health and welfare LPAs cover issues such as where the person making the LPA should live, arrangements for day-to-day care and giving or refusing consent to medical treatment. 

Before using an LPA it must be registered with the Office of the Public Guardian, either by the person making the power, known as the donor, or the attorneys. Property and financial affairs LPAs can be used at the request of the donor while he or she still has capacity, with the attorneys taking complete control if he or she subsequently loses capacity. They can therefore be used if the donor is physically incapable but has capacity and simply needs help with administering their property. Health and welfare LPAs can only be used when the donor lacks capacity to make his or her own decisions.

LPAs are more complex (and therefore costly) than EPAs, but there are some improvements:

  • the donor chooses the persons to be notified of the registration process
  • it is possible to appoint replacement attorneys and
  • it is possible to give attorneys the power to make decisions regarding life-sustaining treatment in the unfortunate event of the donor becoming mentally incapable of making such decisions.

Why should you recommend an LPA?

The benefits are considerable, but include:

  • your clients will appreciate your taking a holistic approach to their affairs and prompting them to review their legal arrangements. It will help prevent family disagreements as to who should be involved with your client's finances, as the client will have made that decision himself or herself in a considered manner before the event
  • your clients and their relatives will have the comfort of knowing that trusted individuals will look after their affairs as soon as help is needed
  • it will make it easier, in the event that a client lacks capacity, for you to carry on advising the client via the attorneys and provide continuity for the family
  • it will make it easier for your client to seek help with dealing with their property and financial concerns should they become either physically incapacitated or mentally incapacitated, whether through a progressive illness such as dementia or as a result of a serious medical problem or accident
  • it avoids the need for an application to be made to the Court of Protection to appoint a Deputy, which is a lengthy and expensive process and involves a degree of uncertainty.