Lasting Powers of Attorney A safety net for you and your family

26. 04. 2011

Lasting Powers of Attorney are not just for the elderly. Adults of every generation should consider whether they can afford not to appoint an attorney. 
Potential pitfall
Have you ever thought about who would look after your financial affairs and your personal welfare if you were unable to do so because of mental or physical incapacity?   
Many people assume that a spouse or family member would automatically be able to take control of their affairs without any fuss or delay if they lost mental capacity, for example, as result of a stroke or car accident.  This is not the case, unless you have taken the wise precaution of completing a document called an Enduring Power of Attorney prior to October 2007 or since that date a Lasting Power of Attorney.
If you lose mental capacity and you have not appointed an attorney, a relative or close friend could apply to the Court of Protection to be appointed to act on your behalf (known as a ‘Deputy’ or previously as a ‘Receiver’). However, this process is very time consuming and costly.  It can take many months for an application to be processed and therefore no-one can access your assets during this time. 
Once a Deputy is appointed, the Court overseas the Deputy and there are annual costs associated with this. A Deputy must produce annual accounts to the Court of Protection and ask for the Courts approval on important decisions, for example, the sale price of the patient’s residential home. 
The solution
To avoid this bureaucracy and unnecessary delay in accessing assets, the solution is for you to appoint a person or persons of your choice as your attorney(s), who would be able to look after your financial affairs. Your attorney(s) would be able to take over your financial affairs if you were mentally or physically incapacitated, out of the country for some time or simply if you chose for your attorney(s) to do so perhaps due to fragility. 
The importance of having such arrangements in place cannot be understated and for those involved in running a family business are an absolute must.
Attorney(s) could also look after your personal welfare if you became mentally incapable and you had previously elected them to do so.
Now for some detail
• There are two types of LPAs. The first is a Lasting Power of Attorney (Property and Affairs) which as the name suggests relates only to financial affairs, for example, the operation of bank and building society accounts, dealing with property and business affairs.
• The other type of LPA is known as a Lasting Power of Attorney (Personal Welfare) and allows your attorneys to make decisions about your personal welfare e.g. where you should live, other welfare issues and if you choose whether your attorney(s) are allowed to make decisions about life sustaining treatment.  
• Both types of Lasting Powers of Attorney can be general to cover unknown future circumstances or very specific with detailed guidance from you. 
• Before your attorney can use your LPA it must first be registered with the Office of the Public Guardian, which is a safeguard to protect you. 
Who would benefit from a Lasting Power of Attorney (Personal Welfare)?
Anyone with specific views on their future welfare needs.
Who would benefit from a Lasting Power of Attorney (Property and Affairs)?
Everyone, from young to old, who have assets that would need to be accessed in the event of a sudden mental or physical incapacity, especially those running a family business or farming enterprise.
The elder generation in particular will recognise the benefits of helping their family or friends help them in the future by preparing a Lasting Power of Attorney (Property and Affairs).
We think you will agree that appointing an attorney (or attorneys) is a sensible precaution. You wouldn’t consider walking a tight rope without a safety net would you?
If you would like more information, please do not hesitate to contact Katharine Ayris at Quantum Law LLP. ].
Death and taxes may be inevitable, but they shouldn't be related. 

Lasting Powers of Attorney are not just for the elderly. Adults of every generation should consider whether they can afford not to appoint an attorney. 


Potential pitfall


Have you ever thought about who would look after your financial affairs and your personal welfare if you were unable to do so because of mental or physical incapacity?

  
Many people assume that a spouse or family member would automatically be able to take control of their affairs without any fuss or delay if they lost mental capacity, for example, as result of a stroke or car accident.  This is not the case, unless you have taken the wise precaution of completing a document called an Enduring Power of Attorney prior to October 2007 or since that date a Lasting Power of Attorney.


If you lose mental capacity and you have not appointed an attorney, a relative or close friend could apply to the Court of Protection to be appointed to act on your behalf (known as a ‘Deputy’ or previously as a ‘Receiver’). However, this process is very time consuming and costly.  It can take many months for an application to be processed and therefore no-one can access your assets during this time. 


Once a Deputy is appointed, the Court overseas the Deputy and there are annual costs associated with this. A Deputy must produce annual accounts to the Court of Protection and ask for the Courts approval on important decisions, for example, the sale price of the patient’s residential home. 


The solution


To avoid this bureaucracy and unnecessary delay in accessing assets, the solution is for you to appoint a person or persons of your choice as your attorney(s), who would be able to look after your financial affairs. Your attorney(s) would be able to take over your financial affairs if you were mentally or physically incapacitated, out of the country for some time or simply if you chose for your attorney(s) to do so perhaps due to fragility. 


The importance of having such arrangements in place cannot be understated and for those involved in running a family business are an absolute must.


Attorney(s) could also look after your personal welfare if you became mentally incapable and you had previously elected them to do so.


Now for some detail


• There are two types of LPAs. The first is a Lasting Power of Attorney (Property and Affairs) which as the name suggests relates only to financial affairs, for example, the operation of bank and building society accounts, dealing with property and business affairs.


• The other type of LPA is known as a Lasting Power of Attorney (Personal Welfare) and allows your attorneys to make decisions about your personal welfare e.g. where you should live, other welfare issues and if you choose whether your attorney(s) are allowed to make decisions about life sustaining treatment.

 
• Both types of Lasting Powers of Attorney can be general to cover unknown future circumstances or very specific with detailed guidance from you. 


• Before your attorney can use your LPA it must first be registered with the Office of the Public Guardian, which is a safeguard to protect you. 


Who would benefit from a Lasting Power of Attorney (Personal Welfare)?


Anyone with specific views on their future welfare needs.


Who would benefit from a Lasting Power of Attorney (Property and Affairs)?


Everyone, from young to old, who have assets that would need to be accessed in the event of a sudden mental or physical incapacity, especially those running a family business or farming enterprise.


The elder generation in particular will recognise the benefits of helping their family or friends help them in the future by preparing a Lasting Power of Attorney (Property and Affairs).


We think you will agree that appointing an attorney (or attorneys) is a sensible precaution. You wouldn’t consider walking a tight rope without a safety net would you?


If you would like more information, please do not hesitate to contact Katharine Ayris at Quantum Law LLP.

 
Death and taxes may be inevitable, but they shouldn't be related. 

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