Understand LPA before you sign up
14th Jul 2009
It is now over 18 months since Lasting Powers of Attorney (LPA) were introduced in place of the Enduring Power of Attorney (EPA).
Although EPAs made prior to October 1, 2007, remain valid, an individual who wishes to make provision for someone to make decisions on his behalf if he loses his mental capacity in the future must now make a LPA.
One change from the previous law is that there are now two types of LPA.
This enables an individual (the donor) to appoint someone (the attorney) to make decisions about their property and financial affairs – as the old EPA did – but also to decide questions about their health and personal welfare.
Such decisions can be very significant and might include deciding where a person will live, whether they require residential care and taking decisions as to medical treatment.
It is also possible to allow the attorney to take decisions about ‘life-sustaining treatment’.
A Property and Affairs LPA enables the attorney to make decisions and take action relating to the donor’s financial affairs, such as paying bills, managing bank accounts and selling the donor’s home.
After registration, the Property and Affairs LPA can be used by the attorney both before and after the donor loses mental capacity.
This enables the attorney to help with everyday tasks which the donor finds difficult, such as talking on the telephone or drawing money from the bank.
A Personal Welfare LPA can only be used once the donor lacks the mental capacity to make such decisions for himself, for example if he is suffering from a condition such as dementia.
Both types of LPA must be registered with the court.
It is clear that both types of LPA are very valuable if a donor loses his mental capacity, but they are also extremely powerful legal documents.
It is therefore important that the donor considers his or her choice of attorney very carefully and chooses a person – or people – who they trust implicitly to act in their best interests.
Because of the powerful nature of the LPA, various safeguards have been included within the legal structure for establishing and registering the documents. These include notifying a trusted individual when the document is registered, thus allowing a period of time for objections to be made, and requiring each LPA to be certified to state that the donor understands the powers granted to the attorney.
Helen Wood is a Partner at BHP Law, based in Stockton. She can be contacted on (01642) 672770.
Author: Helen Wood, Partner (HelenW@bhplaw.co.uk)
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