Powers of Attorney
Furley Page has a team of expert lawyers who specialise in Powers of Attorney, mental capacity issues and matters affecting older or vulnerbable clients. For information about Powers of Attorney or making a Will, use the form on the right to send us your enquiry.
The Mental Capacity Act 2005 has had a major impact on Powers of Attorney since 1st October 2007. The Act introduced a new Property and Affairs Lasting Power of Attorney to replace the Enduring Power of Attorney. Any properly prepared Enduring Power of Attorney made before that date will continue to be valid but you will no longer be able to prepare a new one. The Act also introduced a new Lasting Power for Attorney to enable attorneys to make decisions about health and welfare issues when the Donor* loses capacity. Prior to the Act, you could not delegate decision making about health and welfare matters. The Law concerning General Powers of Attorney has not changed.
By using a Power of Attorney, a person (the Donor*) gives authority to someone else (the Attorney) to act on their behalf and manage their personal affairs. A Power of Attorney might be limited to some specific matter, for example to sell a property whilst the Donor is abroad, but it is usual to give the Attorney the widest powers over the Donor’s affairs. General Powers of Attorney have not only been used by those anticipating trips abroad, but usually as a matter of prudence by those concerned with what would happen should they suddenly become ill or suffer an accident. General Powers of Attorney can also be used to provide interim property and affairs cover whilst the Property and Affairs Lasting Power of Attorney is being registered with the Office of the Public Guardian.
However, a General Power of Attorney does not cover mental incapacity and once the Donor becomes mentally incapable then the Attorney can no longer act. This means that application has to be made to the Court of Protection for assistance if a Property and Affairs Lasting Power of Attorney has not been made. This results in delays and expenses and often distress due to the continuous involvement of the Court of Protection thereafter.
You are no longer able to prepare new Enduring Powers of Attorney, however, existing documents remain valid and will need to be registered with the Office of the Public Guardian when the Donor 'is becoming or has become mentally incapable of managing their own financial affairs'. Until the document is registered the Donor can revoke the Power at any time. Should the Donor regain capacity registration can be reversed.
Before registration can be carried out, it is necessary for the Attorney to give notice to the Donor and to certain near relatives of the Donor. This is to allow any objection to the application to be raised and considered by the Office of the Public Guardian. Assuming that no successful objection is made, the Office of the Public Guardian will register the Enduring Power of Attorney and the full authority of the Attorney will be effective. Once registration has taken place the Attorney may act for the Donor in respect of their financial affairs without having to refer to the Donor for consent, although authority of the Court of Protection may be necessary in relation to certain decisions which exceed the statutory powers given to Attorneys.
There are two types of Lasting Powers of Attorney (LPA) that can be made by the Donor.
The Donor should choose someone they can trust, and the Attorney or Attorneys should be equipped with the powers that may be needed in the future. The Attorney must be over 18 and must not be an undischarged or interim bankrupt person. You can appoint one or more Attorneys. They must agree to be your attorney and sign the LPA. They must act according to the Principles laid down in the Mental Capacity Act 2005 in the Donor’s best interest as set out in the Act and follow the guidance contained in the Code of Practice.
You can appoint your Attorneys to work jointly in relation to all decisions, jointly and severally in relation to all decisions or jointly in respect of some matters and jointly and severally in respect of others. For example you may wish to appoint your Attorneys to act jointly in relation to selling your house but jointly and severally in respect of dealing with your day-to-day finances.
It is now also possible to appoint replacement Attorneys should your original Attorney die or become incapable of acting as your Attorney.
A Donor is able to restrict or limit the occasions when the Attorney should act for them or they can give Attorneys general authority to act on their behalf in relation to all the Donor’s property and affairs. The Donor is also able to give the Attorney guidance, for example on how they would like their finances dealt with or in relation to a Personal and Welfare LPA where the Donor might want to live and what treatments the Donor might prefer not to have.
The Donor is asked to choose up to five people to be notified when the LPA is to be registered with the Office of the Public Guardian. Once registered the Attorney has authority to act. The Attorney has no authority to act under an LPA until it is registered. This differs to the previous situation with EPAs.
Before registration is carried out the people named on the LPA will be notified by the Donor or their Attorneys of the impending registration. On the basis that there are no objections to the registration process the document will be registered and the Attorney will then have full authority to act.
When preparing either type of LPA there must be a Certificate Provider. Without the Certificate Provider’s statement and signature the Power cannot be registered or used. There are two types of Certificate Provider namely skills based or knowledge based. A Certificate Provider must be someone of your choice and be over 18 years of age. They cannot be: - a member of the Donor’s family; a family member of any of the appointed Attorneys; the Donor’s business partner or paid employee; any Attorney appointed by the Donor under the LPA or another LPA or EPA; the owner, manager or employee of a care home in which the Donor is living or their family member or partner and a Director or employee of a Trust Corporation appointed by the Donor as Attorney. If we, your Solicitors, are not appointed as Attorneys we can act as your Certificate Provider.
For further information on Powers of Attorney contact our Older or Vulnerable Client Services team or use the form on the right to send us your enquiry.
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The Legal 500 2012 : Personal tax, trusts and probate