Wills & Private Client

A Power of Attorney is a document by which one person gives another the power to act on his or her behalf – either generally or limited for specific purposes.

A conventional Power of Attorney lapses and ceases to have effect when the donor loses mental capacity. It has for some time been possible to grant an Enduring Power of Attorney which survives loss of mental capacity but the law changed and it was no longer possible to grant a new Enduring Power of Attorney after 31 October 2007.

The law was changed because it was estimated that approximately 10% of Enduring Powers of Attorney had been subject to abuse/fraud. Enduring Powers of Attorney were replaced by Lasting Powers of Attorney. Enduring Powers of Attorney granted before 31.10.07 continue to be valid.

What is a Lasting Power of Attorney?

A Lasting Power of Attorney (LPA) permits individuals to give authority to named Attorneys to make decisions on their behalf. An LPA may grant authority to an Attorney:-

1. To administer property and affairs and/or
2. To make decisions concerning personal welfare including healthcare and consent to medical treatment.

Appointing an Attorney:

An Attorney must be:-

1. Aged eighteen or over.
2. Trustworthy, competent and reliable. Your Attorney may be required to deal with complex financial decisions concerning investments, state benefits, tax and they should be “worldly wise”.
3. An Attorney may not be bankrupt.

It is possible to appoint more than one Attorney who may act either “jointly” (in other words must always act unanimously) or “severally” (each may act independently).

Use of an LPA:

An LPA may not be used until it has first been registered at the Office of the Public Guardian (OPG). An LPA may be registered:-

1. By the Attorney if the donor loses mental capacity.
2. By the donor who retains mental capacity in order to permit the Attorney to undertake some administrative tasks on his behalf.

The Attorney’s authority:

Property and affairs:

Unless the LPA contains restrictions the Attorney may make all financial decisions that the donor could have made including buying and selling assets, claiming state benefits, paying expenses, dealing with tax affairs, managing investments and making gifts.

Personal and welfare:

This includes decisions as to where the donor should live, arrangements for his day to day care, rights of access to the donor’s personal information and consenting to or refraining from medical treatment.

The duties and responsibilities of an Attorney:

An Attorney is required:-

1. To act at all times in the best interests of the donor.
2. To comply with the requirements of the Mental Capacity Act 2005 – and its supporting Code of Good Practice.
3. To act with care and skill.
4. To implement the donor’s wishes.
5. Not to take advantage of their position
6. To keep proper accounting and other records.
7. To keep the donor’s affairs confidential.
8. To act at all times in good faith.
9. To keep the donor’s monies separate from their own.

An Attorney may face civil liabilities for negligence, breach of trust or breach of confidentiality – which may result in awards of compensation should they fail to comply with these duties.

Lawson Lewis Blakers are able to offer expert and cost effective management for the financial affairs of the elderly - dealing either with more demanding issues such as dealing with tax affairs and management of assets to a full management service.