New Powers of Attorney - what you need to know - Everyday Law Spring 2008

13 March 2008

What does the change involve?
Since October 2007 the Mental Capacity Act has had a major impact on Powers of Attorney, introducing a new  Lasting Power of Attorney (LPA) to replace the existing Enduring Powers of Attorney (EPA).

Any properly prepared EPA made before October 2007 is valid but you will no longer be able to make a new EPA. General Powers of Attorney remain unchanged.

Two types of LPA
There are two types of LPA that can be made by a person (known as a donor). The first deals with property and affairs and gives the attorney authority to act in connection with the donor’s financial affairs.

The second relates to personal welfare such as health issues, medical treatment, where to live, what to wear, what to eat, who to see etc. In this case the attorney can only make decisions if the donor has lost capacity.

LPAs are much lengthier than EPAs and require careful study in advance – and they must be registered with the Office of the Public Guardian before the attorney can act.

A major advantage over EPAs is that once the LPA is registered the donor is still able to act in relation to their  own affairs. The donor can act with an attorney or independently of him.

Both types of LPAs require an independent certificate provider to confirm the donor understands the nature and effect of the LPA and also doesn’t feel unduly pressured to make it. The certificate provider must be someone of the donor’s choice and be over 18. There are two types of certificate provider and certain restrictions, so you will need to seek legal advice.

Choosing the right attorney
It may sound obvious but it’s important that a donor should choose someone trustworthy. They must be over 18 and not an undischarged or interim bankrupt. More than one attorney can be appointed.

The chosen attorney must sign an LPA, abide by both the principles stipulated by the Mental Capacity Act as well as the Code of Practice (which runs to over 300 pages) and MUST always act in the best interests of the donor.

Attorneys can be appointed to work together, or together  and independently, or together with regard to certain matters and together or independently with regard to others.

Another advantage over EPAs is that the donor is able to appoint a replacement attorney to act should an attorney die or become incapable of acting. This appointment needs to be made at the time the LPA is prepared.

• General Powers of Attorney – a donor can give authority to an attorney to act on their behalf and manage their affairs. The power might be limited to some specific matter, such as selling a property, or the attorney might be given wider powers over the donor’s affairs generally. A GPA doesn’t cover loss of mental capacity by the donor. If the donor becomes mentally incapable the attorney can no longer act.
• Enduring Powers of Attorney – an EPA is limited in that an attorney only has authority to manage the donor’s property and affairs. The attorney will need to register  the EPA with the Court of Protection if the donor is becoming, or has become, mentally incapable of managing their  affairs. Until an EPA is registered the donor can revoke  the power at any time. There is a specific procedure for  registration which includes the giving of notice to both the donor and certain specified relatives. Once registered the donor may not be able to act for himself but will need to rely on his attorney.
 

For more information please email Nicola Rostron

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