There are two types of Lasting Power of Attorney available under English law:
Health and Welfare
Lasting Power of Attorney
Property & Financial Affairs
Lasting Power of Attorney
Health and Welfare Lasting Power of Attorney
A Health and Welfare Lasting Power of Attorney (LPA) allows you to name Attorneys to make decisions about your healthcare, treatments and living arrangements if you lose the ability to make those decisions yourself. Unlike the Property and Financial Affairs LPA, this document will only ever become effective if you lack the mental capacity to make decisions for yourself.
If you can’t communicate your wishes, you could end up in a care home when you may have preferred to stay in your own home. You may also receive medical treatments or be put into a nursing home that you would have refused. Having Lasting Power of Attorney will allow your Attorney to speak on your behalf to express your wishes.
Property and Financial Affairs Lasting Power of Attorney
A Property and Financial Affairs Lasting Power of Attorney (LPA) allows you to name Attorneys to deal with all your property and financial assets in England and Wales. The Lasting Power of Attorney document can be restricted so it can only be used if you were to lose mental capacity, or it can be used more widely, such as if you suffer from illness, have mobility issues, or if you spend time outside the UK for any reason.
Sole trader or Small and Medium Enterprise (SME) business owners
As a business owner, considerations should be made to ensure that, should problems arise such as accident or illness, your business is not impacted. You should think about the impact if for example you lost the ability to make decisions for the business or if you hold a joint business account that requires all parties to sign to authorise transactions.
Having a Lasting Power of Attorney in place could allow your business to continue to operate and prevent it going out of business.
What if you don’t have a Power Of Attorney
Without a Lasting Power of Attorney (LPA) in place there is no one with the legal authority to manage your affairs including having access to your bank accounts and investments or selling your property on your behalf. Unfortunately, many people assume that their spouse, partner or children will just be able to take care of things but the reality is that this is not the case at all.
In these circumstances, in order for someone to obtain legal authority over your affairs, that person would need to apply to the Court of Protection and the Court will decide on the person to be appointed to manage your affairs. The person chosen is appointed your ‘Deputy’. This is a very different type of appointment which is significantly more involved and costlier than being appointed Attorney under a LPA.
This can be a very difficult time for both you and the people around you. If you want peace of mind that a particular person(s) will have the legal authority to look after your affairs and want to make it easier and less costly then you should strongly consider getting a Lasting Power of Attorney in place.
You can apply to become someone’s Deputy if they ‘lack mental capacity’. This means they cannot make a decision for themselves at the time. They may still be able to make decisions for themselves at certain times.
People may lack mental capacity because, for example:
They’ve had a serious brain injury or illness
They have dementia
They have severe learning disabilities
As a Deputy, you’ll be authorised by the Court of Protection to make decisions on their behalf. There are two types of deputy similar to the types of Lasting Power of Attorney:
Property and financial affairs Deputy
Health and wellbeing Deputy
You can apply to be just one type of Deputy or both. If you’re appointed, you’ll get a court order saying what you can and cannot do. When you become a Deputy, you must send an annual report to the Office of the Public Guardian (OPG) each year explaining the decisions you’ve made.
If the person already has a Lasting Power of Attorney (LPA) they do not usually need a Deputy. You should check if they have one in place before you apply for Deputyship.