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Making future decisions – legal power of attorney
You may wish to prepare for a time when you can no longer manage the running of your day-to-day affairs or make decisions about your property and finances, or about your health and welfare.
You can make an LPA and can choose one or more people you trust to deal with all or some of your property and financial affairs or health and welfare when, and if, it becomes a problem for you. You must apply for an LPA while you have ‘capacity’ to do so.
People often appoint more than one ‘attorney’ to act for them. This guards against abuse of the wide powers over property and finance that the Power of Attorney gives. It can also be a good idea because people may have different skills relating to property, finance or health and welfare. Attorneys may act ‘jointly’(where they must all sign all transactions) or ‘jointly and severally’ where only one person needs to sign. If you change your mind later about the person or people you have chosen, you can revoke the document.
There are two types of LPA:
- LPA for financial decisions
- LPA for health and care decisions.
Enduring Power of Attorney (EPA)
EPAs were replaced by LPAs in October 2007. However,if you have already made an Enduring Power of Attorney (EPA) or are acting on behalf of someone under an EPA, it is still valid under the new legislation unless the person who made it decides to destroy it and replace it with an LPA. An EPA must be registered when the person loses mental capacity to make decisions about their property and finances if it is to be used.
An LPA for financial decisions can be used while you still have mental capacity or you can state that you only want it to come into force if you lose capacity.
An LPA for financial decisions can cover things such as:
- buying and selling property
- paying the mortgage
- investing money
- paying bills
- arranging repairs to property.
You can restrict the types of decisions your attorney can make, or let them make all decisions on your behalf.
If you’re setting up an LPA for financial decisions, your attorney must keep accounts and make sure their money is kept separate from yours. You can ask for regular details of how much is spent and how much money you have. These details can be sent to your solicitor or a family member if you lose mental capacity. This offers an extra layer of protection
It is a common belief is that the person nominated as our ‘next of kin’ can make decisions for us if we are unable to make them for ourselves. However, in law ‘next of kin’ has no legal standing and such decisions cannot be made by our friends or family unless we have put the appropriate legal arrangements in place.
A Lasting Power of Attorney (LPA) for Health and Welfare is a legal document which can be made to cover a loss of mental capacity in relation to decisions about health and welfare on a temporary or permanent basis.
It is important to plan ahead and set up a Lasting Power of Attorney now to enable a person of your choosing to make health and welfare decisions on your behalf should you lose mental capacity to make these decisions for yourself
An attorney can generally make decisions about things such as:
- where you should live
- your medical care
- what you should eat
- who you should have contact with
- what kind of social activities you should take part in.
You can also give special permission for your attorney to make decisions about life-saving treatment.
Here are two short videos which explain the process:
You don't have to use a solicitor to create an LPA. There is an online service on the Government’s website which guides you through the process of making an LPA.
It is free to complete your LPA online but your LPA cannot be used until it's registered. There's a £82 application fee to register each LPA. If the donor has an income below £12,000, or gets certain benefits, they might qualify for a lower fee, or the fee might be waived altogether.
For an LPA to be valid it needs to be signed and witnessed by all people mentioned on the LPA. The online tool makes it simpler to do the first part, the filling in of the form but you will need to print the form out to get the necessary signatures. A printed, signed LPA has to be registered with the Office of the Public Guardian before it can be used.
If you want to make a property and financial affairs LPA and a health and welfare LPA these will form two separate documents.
If you want to use a solicitor, you'll need to pay them to complete the form for you. Fees for creating an LPA vary, so you might want to contact a few to compare their fees and the service they offer.
When can the LPAs take effect?
- The property and financial affairs LPA can take effect immediately or when you lose mental capacity to make the decisions about your property and finance and this can be specified.
- The health and welfare LPA can only be used when you lose mental capacity to make those decisions for yourself.
The Court of Protection can make decisions about the finances and welfare of people who cannot make decisions for themselves.
If someone only has income from benefits and no capital then their affairs can be managed by an Appointee – through the Department for Work and Pensions. If they have capital (e.g. savings) then a court-appointed deputy will be required.
If your friend or relative:
- is mentally incapable of managing their own financial or welfare affairs
- has not made an Enduring or Lasting Power of Attorney and is now mentally incapable of doing so
- has assets that need to be used for his or her benefit or administered in some way, or has complex welfare decisions that cannot be resolved in any other way
then you can apply to the Court of Protection.
The Court will either make a one-off decision or they will appoint a Deputy to manage and administer the person's property and financial affairs.
Please note: They do not offer legal advice so for this, or for help in understanding the Powers of Attorney, you should contact a solicitor.