What is a Lasting Power of Attorney (LPA)?
A Lasting Power of Attorney is an officially recognised document which allows another person(s) to have authority to access your bank accounts to pay bills on your behalf when you are no longer able. There are two parts to Lasting Powers of Attorney:
- Property and Financial Affairs
- Health and Welfare
What is an Enduring Power of Attorney (EPA)?
The Enduring Power of Attorney has been superseded by Lasting Powers of Attorney. Enduring Powers of Attorney were a much simpler, shorter document which could be made and then stored until it was needed.
I have an ‘Enduring Power of Attorney; is it still valid?
If you have an EPA stored with a Solicitor which has not yet been validated, this can still be validated and used. Enduring Powers of Attorney only cover ‘Property an Financial Affairs’ and not ‘Health and Welfare’ and you will need to take out a Lasting Power of Attorney for Health and Welfare to cover you should you go into hospital or a nursing home.
Do I need a Lasting Power of Attorney?
Martin Lewis (Money Savings Expert) says, “Everyone over the age of 18 should have a Lasting Power of Attorney”; this is because a friend had suffered a stroke at a young age who was then unable to write cheques for himself.
On the other hand, retired Senior Judge at the England and Wales Court of Protection, Denzil Lush, told BBC listeners in August 2017 “I would never grant anyone a Lasting Power of Attorney over my affairs because of the risk of abuse”. Judge Denzil Lush had obviously experienced many years of dealing with people in Court arguing about attorneys who had taken advantage of their appointment.
It is up to you who you choose to act as your attorney and the Office of the Public Guardian will not take responsibility at the end of the day if the person you choose takes advantage of their position – choose carefully!
How many Attorneys can I appoint?
You can appoint up to 4 attorneys to act on your behalf although the term, ‘Too many cooks…’ springs to mind. There is the option to appoint ‘Replacement Attorneys’ which is recommended should your attorney predecease you. If you only appoint one attorney and they die, your Lasting Power of Attorney would become null and void and you would be forced into making a new one, if you still had mental capacity.
“I’m ‘next of kin’ – I don’t need one”
This might come as a shock but should you find yourself in hospital, the hospital staff and doctors only want to speak to the ‘Attorney’ – they do not want to speak to the ‘next of kin’. If an important decision needs to be taken at this stage, Social Services will be called in and you, (like one of the Solicitors in this firm could be told to, “sit down and shut up” if you do not have a validated Lasting Power of Attorney.
I have been diagnosed with ‘early onset dementia – I am too late?
If you still have metal capacity and obtain a letter from your doctor at this early stage to confirm that you understand the document you are about to sign, create Lasting Powers of Attorney as soon as possible as you will definitely require these in the future and you have no time to waste. Registering a Lasting Power of Attorney cannot be expedited and will take 3 months before it is returned and ready to use.
Once you have lost ‘mental capacity’ you are unable to make a Lasting Power of Attorney and will be forced to go through the Court of Protection to apply for a Deputyship Order. This takes many months and is more expensive. Even when you have been appointed as a Deputy, a person from Social Services will still be allocated to you to ensure that everything you spend is for the benefit of the person who has lost capacity; with a Lasting Power of Attorney, your attorney will be on their own.
Property and Financial Affairs / Health and Welfare
The Property and Financial Affairs part can be introduced to financial companies when you want your attorneys to take over your affairs and act on your behalf. Attorneys are then able to access you bank accounts and pay any bills and keep track of your finances.
Attorneys should open up a separate ‘Attorneys Account’ to keep their finances separate from those of the donor.
The Health and Welfare part is used when you are in hospital and has an additional section in it giving your Attorneys permission to act and make decisions on your behalf or not.
The Health and Welfare part is also requested and needed should you go into a nursing home. Your attorneys can choose which nursing home they would like you to go into rather than being told which nursing home you are going into by Social Services.
Why use a Solicitor? Can’t I take these out myself?
Yes, you can make Lasting Powers of Attorney online yourself, however, when and if they are rejected, you will have to pay the registration fees again until they are accepted. Solicitors will also know and insert wording which banks might require but which the Office of the Public Guardian do not.
What happens when I die?
The Lasting Power of Attorney ‘dies’ with the donor, at which time the Attorney is replaced by the Executor, if you have a Will. The Lasting Powers of Attorney should be returned to the Office of the Public Guardian along with the Death Certificate and will be cancelled and removed from their records. If you don’t have a Will, make one now.
What is the registration fee?
The Office of the Public Guardian register these documents and charge a fee of £82 per part (£164 for both parts) to validate the Lasting Powers of Attorney.
Fussell Wright’s fees:
There are two parts to Lasting Powers of Attorney:
|Property and Financial Affairs||£300 + VAT|
|Health and Welfare||£300 + VAT|
You do not have to take out both parts of the Lasting Powers of Attorney. The Property and Financial Affairs is more important and will most probably be used more than the Health and Welfare. Thankfully, I have not had personal experience of having to put Lasting Powers of Attorney into use but was once told by a client, “I wish I had taken out both parts”. The choice is yours!
The Donor – The person who needs/wants assistance
Attorney(s) – People chosen by you to act on your behalf
Replacement Attorney – If you choose to have just 1 attorney, you can appoint a replacement attorney just in case that person predeceases you.
Notice – this is no longer a requirement on the new LPA forms but is still an option
Name and address of close friend or relative to notify. This is to prevent a Lasting Power of Attorney being registered fraudulently whilst the person is, for example, away on a long holiday.