The Importance of a Lasting Power of Attorney
A Lasting Power of Attorney (“LPA”) is a legal document that lets you appoint one or more people as your attorneys to help you make decisions or to make decisions on your behalf. It is a very powerful and wide-reaching document. There are two types of LPA:
The Health and Welfare LPA can only be used to make decisions for which you no longer have the capacity to make such a decision for yourself and allows your attorneys to decide about your daily routine, medical care, moving into a care home, and life-sustaining treatment.
The Property and Financial Affairs LPA allows your attorneys to manage your bank account, pay your bills, collect your pension, and even sell your home if necessary. This is also the type of LPA people use when giving people the power to make decisions in relation to their business affairs.
Unfortunately if you do not have capacity, which may be the case if you have dementia, a serious brain injury or illness, or severe learning disabilities, you will be unable to make an LPA. This is likely to cause difficulties for your family as they will not have the legal authority to deal with your affairs. This could mean that they are unable to access or withdraw money from your bank account and they may have to pay your bills, rent or mortgage payments, and any care home fees with their own money; which can be costly and time-consuming for your family.
In this case, your family may need to apply to the Court of Protection (the “Court”) to be a Deputy for you. The Court makes decisions about financial or welfare matters for people who are unable to make their own decisions. There is a stringent application process to become a Deputy which usually takes between 9 and 12 months to be approved by the Court. In the meantime, your family members will not be able to manage your care or affairs for you.
Applying to be a Deputy is a very long and expensive process; the application fee is £385, there is an annual supervision fee of up to £320, and your family may have to pay a security bond to be a Property and Affairs Deputy. The cost of obtaining legal advice can also range from £1,500 to £2,000 to prepare the Deputyship application.
Once they are appointed as a Deputy, the Court will supervise them and may undertake visits to ensure everything is going well and they will also be required to keep accounts and provide an annual report to the Court.
To avoid causing any unnecessary stress and expense for your family, you should think about making an LPA today whilst you have the capacity to do so. This will ensure that your affairs are in order and that there is someone who has the legal authority to help you if you were unconscious, unable to leave the house, or did not feel able to deal with matters yourself.
To discuss any of the issues raised above, please contact a member of the Private Client team on 01384 410410.