Lasting Power of Attorney – what is it ?
The Lasting Power of Attorney (LPA) was introduced on 1st October 2007 – it is now the primary way to give an attorney the authority to look after a person’s financial affairs. The LPA operates both before and after a person becomes incapable of managing their own affairs.
The power to look after money and property is called a ‘Property and Affairs LPA’.
There are also ‘Personal Welfare’ LPAs, which give an attorney the power to make decisions about non-financial matters, such as where one should live or medical treatment.
The new legislation means that the previous type of power of attorney (Enduring Power of Attorney – EPA) can no longer be created. However, existing EPAs, ie those granted before 1st October 2007, will continue to be effective.
The new Property and Affairs LPAs (like their predecessors, the EPAs) can give the attorney authority to act both before and after the onset of mental incapacity. However, unlike EPAs, Lasting Powers of Attorney must be registered with the Office of the Public Guardian (OPG) before an attorney has power to act and there is a Court fee payable for the registration, presently £150.
The Personal Welfare LPA, however, can be used by the attorney only after a person has lost capacity and, once again, has to be registered with the Public Guardian before it can be used.
These new LPAs are much longer documents than the old EPAs. Primarily, this is because the person giving the power (‘the donor’) has far greater choices, for example:
- the donor can appoint a replacement attorney to act if an original attorney can no longer do so;
- restrictions and conditions can be placed on the attorney;
- the donor is able to give guidance to his attorney about matters he would wish considered when decisions are made;
- the donor can nominate who they would like to be notified of registration of the LPA.
Another major difference with the new LPAs is that there is a requirement for a Certificate Provider. This is a person who has to certify that the donor understands the purpose of the LPA, the extent of the authority they are giving to the attorney and that the donor is not being influenced or pressurised into giving the Lasting Power of Attorney.
Certificate Providers are people who have either known the donor personally for a minimum period of 2 years, or someone chosen by the donor who has the relevant professional skills and expertise to certify the LPA, e.g. a solicitor or a doctor.
Attorneys under Lasting Power of Attorneys are under an obligation to act in accordance with the principles of the Mental Capacity Act 2005 and to have regard to the Act’s Code of Practice. The objective of the new legislation is to be supportive and enabling, so that attorneys should always try to encourage their donor to make and/or participate in decision-making whenever possible.
The OPG has prepared guides that are essential reading for people considering making an LPA and for their proposed attorneys.
Due to the length and greater complexity of LPAs, they are inevitably more expensive to prepare than EPAs. We are happy to give an estimate of our fees and let you have copies of the guides referred to above, for those considering making a Lasting Power of Attorney and those thinking about taking on the role of attorney.
Contact our solicitors about making a Lasting Power of Attorney