Lasting Power of Attorney

Have you considered what would happen if you became incapable of making decisions for yourself? The importance of a Lasting Power of Attorney (LPA) cannot be underestimated for your peace of mind and that of your loved ones.

The benefits of drawing up a will are widely recognised. In doing so, you make provision for the winding up of your affairs after death.

This not only has advantages for those who will find themselves administering your estate, but also gives you peace of mind, knowing that you have selected as executors the individuals best suited for the role and have given them the necessary instructions.

There are also opportunities available to make provision in advance for the possibility of you becoming incapable of managing your own financial and welfare affairs during your lifetime. This becomes increasingly important as the risk of supervening mental incapacity grows through longevity, illness or accident.

Unlike a will that takes effect on your death, a power of attorney is a legal document for property that takes effect while you are still alive. If you cannot make decisions with respect to your assets, your attorney will be able to make decisions and carry out these decisions on your behalf. A power of attorney for property is an essential part of the process known as estate planning. However, you should only name a person whom you trust completely.

The NHS estimate that more than 2,000,000 people lack the mental capacity to make decisions for  themselves as a result of  dementia, mental health difficulties, brain injuries or other illnesses that may occur even in the prime of life. No one likes to think about losing the ability to manage their own  affairs,  but it could happen to anyone, at any age.  It is often assumed that the spouse or family members are entitled to manage your financial affairs but without your express authority this is not possible.

The British Bankers Association have confirmed that joint bank or building society accounts will be frozen if ONE of the account holders lacks mental capacity and there is not a registered LPA in place?

There are two types of LPAs.

Property and affairs LPA 

These are designed for you to appoint attorneys to make a range of decisions including the buying and selling of your house and other assets, dealing with your tax affairs, operating bank and building society accounts and claiming benefits on your behalf.

Personal welfare LPA 

Attorneys appointed under this document can make decisions relating to your living accommodation and care, consenting to or refusing medical treatment on your behalf, whether you continue to live in your own home or move into residential care. It maybe that you need help and support from social services, or on day-to-day matters such as diet and dress.

Lasting Powers of Attorney LPAs were created by the Mental Property and affairs LPA.  MCA 2005 provides a statutory framework to deal with situations where adults lack capacity to make decisions for themselves or who have capacity but want to make preparations for a time when they may lack capacity in the future.

A Code of Practice supports the MCA 2005 and provides guidance and information to all those working under the legislation. Certain categories of people are obliged to have regard to the code of Practice, including attorneys and those acting in a professional capacity. In some cases it may also be appropriate to appoint a trust corporation as an attorney, often with a family member or a close friend.

Rather like a Will, you need to have full mental capacity to complete a Lasting Power of Attorney. If one is not in place when needed, an application has to be made to the Office of the Public Guardian. This process is intrusive, expensive and burdensome and requires the payment of ongoing fees. It could also result in someone you may not have chosen managing your financial affairs.

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