We all want to know that our affairs are in order, and most of us like to think we will have as much involvement in them as possible for as long as we can. However, there may be times when we are either unwell or, for practical reasons, cannot be in the right place at the right time to sort things out ourselves.
Making a Lasting Power of Attorney (LPA) enables you to appoint someone you trust to deal with your affairs in the way that you ask. This may be one or more close family members, a trusted friend, or a solicitor if you prefer. With your consent, your attorneys can act on your behalf in connection with your finances or property, even if you are still able to make decisions for yourself. For example, it may be useful to have someone to sign documents or make payments for you if you are abroad.
Sometimes, if we become unwell or develop dementia, we cannot make decisions anymore because we lose mental capacity to do so. In these situations, your attorneys can make decisions for you. Any decisions made on your behalf must be made in your best interests.
The Mental Capacity Act enables people to appoint attorneys to deal with their financial and property affairs in the UK, and, in some cases, their business affairs. Appointing more than one attorney may be useful, for example, if you have children who you would like to appoint as attorneys who might travel abroad at times. If an attorney cannot assist on occasions, the other attorneys can still act on your behalf if they are appointed on a joint and several basis.
You may also want to appoint different attorneys for your business matters, compared with personal financial or health matters. If you own a company or a partnership, the articles of association or partnership agreement should be checked first, as these may already have rules for situations where business owners cannot act. However, there may be circumstances where an LPA is useful if no provision has already been made. For sole traders and smaller businesses, LPAs can be important in ensuring things can continue to operate in the UK if you are abroad, are unwell or have an accident, and salaries still need to be paid or cheques signed.
You can also appoint attorneys to make decisions for you in relation to your health and welfare if you no longer have mental capacity to make these decisions yourself. This would include the types of medical treatment you have. Your attorneys must always try and give you the opportunity to decide things for yourself before “stepping in”. You can state your preferences or instructions in your LPA. Another way to make your wishes clear regarding medical treatment, without appointing a health and welfare attorney, is by making an advance decision. This can be kept on your medical file.
You must have mental capacity to make an LPA in the first place, but it is still possible for someone to act in connection with your financial affairs for you if you cannot appoint them as your attorney. They can apply to be appointed to be your deputy by the Court of Protection. However, your deputy may not be the person you would choose yourself. In any event, making a Lasting Power of Attorney is usually easier, quicker and more cost effective. In particular, if you have any specific wishes about the type of medical treatment you wish to receive, it is advisable to make an LPA specifying this. It can be more difficult to obtain authority from the Court to make medical decisions on someone’s behalf after they no longer have mental capacity than for financial affairs. Most importantly, making an LPA gives you as much control over your affairs as possible for times when you cannot act for yourself, by enabling you to choose the person who will manage affairs which are important to you.
To make an appointment to discuss an LPA, please contact a member of our Private Client team.