What is a Lasting Power OF Attorney?
Lasting Powers of Attorney were brought in in October 2007 as a result of the Mental Capacity Act 2005. Lasting Powers of Attorney were designed to produce extra protection as they need to be registered with the Office of the Public Guardian before they can be used. This is supposed to happen under an Enduring Power of Attorney when the donor loses capacity, but in reality it often doesn’t.
What a Lasting Power of Attorney does
A Lasting Power of Attorney (LPA) allows the donor to appoint an attorney or attorneys to manage their property and finances and also their health and welfare. However, health and welfare LPAs can only be used once the donor has lost capacity. A for a property and finance LPA can be used as soon as it has been registered with the Office of the Public Guardian, allowing the attorneys to assist elderly relatives who may retain understanding but would like assistance with their finances. Lasting Powers of Attorney are not, however, limited to elderly people.
Why should I have one?
The donor does not have to lose capacity to use a property and financial affairs Lasting Power of Attorney and anyone over the age of 18 can have a Lasting Power of Attorney, property and financial affairs. You do not have to be elderly to need a Lasting Power of Attorney, and everyone should consider having one. If the donor was to have a stroke and was bedbound, who would help pay the bills without the LPA ? If the donor was in an accident and in a coma for several weeks/months, who would deal with the financial matters without a Lasting Power of Attorney ? There are many scenarios where having a Lasting Power of Attorney in place would be beneficial for everyone, not just the elderly.
Lasting Power of Attorney versus Deputyship
The main reason for having a Lasting Power of Attorney is that they are a lot cheaper and quicker to obtain than a Deputyship. Deputyship is the alternative if a power of attorney is not in place and a person loses understanding. An application to the court of protection is required which can take months Many people keep meaning to draw up a Lasting Power of Attorney but life is too busy and more exciting things take priority. If you leave it too late and no longer have capacity to draw up a Lasting Power of Attorney, then the cost of obtaining a Deputyship could be a lot higher.
Obtaining a Lasting Power of Attorney costs less than half that obtaining a Deputyship does. Deputyships also attract an annual fee of around £500 per year where as there are no on-going costs once the LPA is in place. As you can see, the cost of a Lasting Power of Attorney is much lower and leaving it until later in life to put something in place comes with the risk that when you need it, you might not be able to put it in place. .
For more information about Lasting Powers of Attorney, please contact me at our Halifax office on 01422 339641, or speak to any of my colleagues below.
Penny Manock
Hayley Meskimmon