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A Lasting Power of Attorney (LPA) is a legal document which allows you to appoint a person or persons to make decisions regarding your personal affairs during your lifetime. It is, therefore, extremely important that you appoint people you trust, such as family members or close friends.
There are two types of LPA – Property & Financial Affairs and Health & Welfare. Both types will give your attorney/s (the person/s appointed to deal with your affairs) legal authority to make decisions for you, but in different circumstances (some of which may overlap).
An LPA can only be created if you are aged 18 and over and you also have the requisite mental capacity to do so (i.e you are still capable of making your own decisions). It is therefore never too early to consider creating them.
The Property & Financial Affairs LPA allows your attorneys to make decisions regarding your banking, investments, pensions/benefits and property. This could involve managing your investments, paying bills from your bank account and selling your property (if needed).
Many people are concerned that this would take away their freedom and control, however, it is the opposite. The document is there to ensure that you are assisted either because you have decided you would like assistance or you need assistance because you have lost mental capacity. The document can be used even if you still have capacity and have decided you just need some help with paying bills (for example). All the while you have capacity, it is your decision as to whether you would like your attorneys to assist you. If you have lost mental capacity, the document will remain valid, and your attorneys will then automatically have authority to make decisions for you.
The Health & Welfare LPA gives your attorneys the legal authority to make decisions regarding your health & wellbeing when you no longer have the mental capacity to do so. Types of decisions that can be made are: where you will live (this could include a Residential/Nursing Home facility), liaising with your GP, Dentist and other medical professionals and also decisions that may need to be made about Life Sustaining Treatment.
It is often mistaken that once you lose mental capacity, your spouse or next of kin automatically have the legal authority to make decisions on your behalf regarding your financial and health care. However, this is not the case.
In order for your spouse (or other family members/friends) to have the legal authority required to make decisions on your behalf, they will need to be appointed as an attorney under one (or both) of the LPAs.
If you lose mental capacity and do not have these documents in place, your family (or the Court) will need to apply for a Deputyship Order. This is an extremely costly and complicated process which can cause a lot of stress for those around you.
People will often mistake having executors appointed under a Will as having attorneys appointed under an LPA. However, these are two very separate roles. An attorney’s authority will only last for the duration of your lifetime. It will automatically cease on your death. An executor’s authority derives from your Will, which only takes effect on your death.
It is advisable to create both types of LPA to ensure that the people you would like to have authority to make decisions regarding all aspects of your personal affairs. You do not, however, have to create both types if you do not want to,.
If you created an Enduring Power of Attorney (EPA), subject to any restrictions and conditions in the document, it should still be valid. It is important to note, that an EPA is far more restrictive than the current LPAs and so it may be worth considering upgrading to the LPAs.
An EPA only covers certain financial aspects and so does not cover decisions in respect of your health & welfare.
An EPA can only be registered if you lose mental capacity. In contrast, an LPA can be registered while you still have mental capacity. We would recommend registering the LPA as soon as it has been signed by all parties to ensure there is no delay when the document is needs to be acted on.
An LPA is one of the most important documents you can create and so it is even more important to ensure it is prepared correctly.
We are more than happy to meet with you (face to face, by telephone or zoom) to discuss the process in further detail. Our services include all the advice needed, preparation of the documents, liaising with your attorneys for signature and sending the documents to the Court for registration. We can also act as professional attorneys if needed.
If you would like any further information on preparing LPAs or any separate advice regarding your Will (updating or creating one), please do not hesitate to contact our Private Client team on 01243 787899 (Chichester), 01329 282941 (Fareham) or 01243 787899 (Havant).