A Lasting Power of Attorney

A will distributes your assets when you die. Before then, however, there could be a situation where through accident or illness or old age, you are temporarily or permanently unable to manage your affairs. This is where a power of attorney is needed otherwise you might end up with financial chaos on top of severe emotional stress for you, your family and others.

What is a power of attorney?

A power of attorney is a legal document whereby one person gives another person the power to take decisions on their behalf. The concept of a lasting power of attorney was introduced on 1 October 2007, by the new Mental Capacity Act and gives someone the legal power to act on your behalf, in particular, in circumstances where you are incapable of managing your own affairs through mental incapacity.

How many types of lasting power of attorney are there?

There are two types of lasting power of attorney:

1. Property and affairs lasting power of attorney: this allows someone to make decisions about how to spend your money and the way your property and affairs are managed.

2. Personal welfare lasting power of attorney: this allows you to choose someone to make decisions about your healthcare and welfare. This includes decisions to refuse or consent to treatment on your behalf and deciding where you live. These decisions can only be taken on your behalf when the lasting power of attorney is registered and you lack the capacity to manage your affairs.

What is registration?

A lasting power of attorney has no legal standing until it is registered with the Office of the Public Guardian (OPG). Once registered, it can be used at any time, whether you have the mental ability to act for yourself or not. Registration can be made at any time after you have made a lasting power of attorney. Before the application to register, the people named as being entitled to receive notification of the application (chosen by you), must be told by the person who wants to register it.

Can your spouse not manage your affairs for you?

Yes - but only if they have been given a lasting power of attorney. Many people believe (wrongly) that their spouse or partner can simply immediately step in but they cannot. They also need a lasting power of attorney. If one is not obtained they would need to apply to the OPG to get permission to handle your affairs. This can cost several thousand pounds and take over six months to achieve. Meanwhile there could be financial chaos on top of the huge emotional crisis of someone losing their mental capacity.  This means the person appointed (known as a deputy) would need to apply to the OPG for every decision which would completely monopolise someone’s time and energy.

Who should act as your attorney?

You could choose any one or more people who you trust to act as your attorney provided they are over 18 years of age and not bankrupt. You must therefore trust that the person you choose would not take advantage of the position to gain any benefit for themselves.