Lasting Powers of Attorney
'Mental capacity' means being able to make your own decisions, and dealing with a potential future loss of mental capacity is now one of the key areas of Estate Planning.
Someone lacking capacity - because of an illness or disability such as a mental health problem, dementia or a learning disability - cannot do one or more of the following four things:
Understand information given to them about a particular decision
Retain that information long enough to be able to make the decision
Weigh up the information available to make the decision
Communicate their decision.
What causes a lack of mental capacity?
A lack of mental capacity could be due to:
a stroke or brain injury
a mental health problem
a learning disability
confusion, drowsiness or unconsciousness because of an illness or the treatment for it
substance or alcohol misuse.
Taking the first example, a stroke, government figures reveal that someone, somewhere in the UK, has a stroke approximately every three and a half minutes. Strokes are not only serious, potentially fatal medical events, but they can cause a person to lose their mental faculties. Following a stroke, you may not be able to think logically or make decisions as you could do before. Mental capacity can be lost or altered in various ways, from diseases, accidents, illness… the list goes on.
You may not see that as an issue when it comes to matters outside of your health: your family can take control of your financial affairs and manage the day to day tasks that you’re no longer able to. In the absence of power of attorney, however, your loved ones will struggle. Banks won’t automatically give them access to your accounts and finances, which would result in them losing access to your money.
While they can, of course, apply for power of attorney through the court system if you suffer a medical event that renders you unable to make decisions for yourself, the process will be a lengthy one. It’s far easier and less worrisome to have already arranged for your loved ones to have access to your finances and affairs before any incapacitating medical problem should occur.
What Is Lasting Power Of Attorney?
Lasting Power of Attorney is a legal document which allows people you have selected to manage your financial and personal affairs on your behalf if a situation arises that leaves you unable to do so yourself. The law calls these selected people “attorneys.”
You decide to give people lasting power of attorney while you are still in possession of your mental faculties. The person chosen can be anyone, but it is most common to opt for someone you know well and trust, such as a friend or a member of your family. A lasting power of attorney comes into effect from the moment that you’re no longer able to make decisions for yourself. It may also be used by your attorneys while you are still well, but only at your direction. This is especially helpful if your hearing, eyesight or mobility have become a problem.
It’s important to remember that lasting power of attorney is only applicable at such time that you are incapable of making decisions or while you are capable, but at your direction. You may be incapable in the immediate aftermath of a stroke, but then make a recovery in the months to come. Once you have recovered and are able to make your own decisions again, your attorney(s) must assist you to manage your own affairs again, and revert to acting only when you direct them to do so, or you become incapacitated once more.
Why Should You Grant Lasting Power Of Attorney?
Although of course, you don’t have to grant anyone lasting power of attorney, there are numerous benefits in doing so.
Peace Of Mind: Whether or not you think that you may become ill, the knowledge that there is someone you can trust to manage your affairs when you’re unable to do so can be comforting. Having your trusted attorney(s) ready to assume control in the event that you become incapacitated, means that you no longer have to worry about their being able to access your finances to pay for your treatments and care, manage bills and the day to day household expenses.
A person of any age can get peace of mind by setting up a lasting power of attorney. Although age does have a role to play in the chances of becoming incapacitated, people of all ages could be involved in accidents or develop an illness which might leave them unable to make decisions. Giving someone lasting power of attorney grants you peace of mind that your financial affairs and medical wishes will be taken care of as you want.
Your Next Of Kin Have No Legal Right To Manage Your Affairs: A lot of people think that in the event that they become incapacitated, the law will automatically grant their next of kin access to all of their finances and the right to take over their personal affairs. This is unfortunately not the case. The law gives your loved ones no rights at all. Your next of kin may struggle to manage your affairs in the period while they are applying for a deputyship order. In addition to this, it costs much more to apply for a deputyship order once you become incapacitated, which is why it is advantageous for both you and your loved ones to have it done in advance.
You Cannot Appoint An Attorney Once Incapacitated: As the person whose affairs are to be managed, it should be your decision whom to appoint as your attorney. However, if you wait until you become incapacitated, the court will choose somebody to act on your behalf, and that might not be the person you want. Remember, once you are no longer capable of signing the lasting power of attorney legal document, you can no longer choose your representative.
Types Of Lasting Power Of Attorney
Lasting power of attorney is divided into two types by law.
Health and Welfare: A health and welfare lasting power of attorney grants you the ability to appoint people you trust to oversee your healthcare, medication and care environment should you become ill and unable to do so yourself. There may come a time when you’re no longer capable of deciding these things for yourself, the lasting power of attorney gives your loved ones the right to manage this on your behalf. Making these decisions before you become unable to is vital. You may wish to stay in your own residence with carers, for example, but if you don’t appoint somebody to carry out your wishes in advance, you could be put in a care home, or another situation you aren’t happy with. If you don’t grant lasting power of attorney, you could also be given medical treatments that you wouldn’t have willingly chosen.
Property and Financial Affairs: The property and financial affairs lasting power of attorney grants you the ability to appoint people to manage your financial affairs. You may personalise the lasting powers of attorney document to detail when and how the powers will be granted. Customarily, the document specifies that control of your financial affairs goes to your appointed representative when you lose capability and whilst you have the capacity, at your direction. You could though, create more thorough documents which grant powers if you leave the country, suffer issues to do with eyesight, hearing or mobility, or experience a more general illness (which doesn’t inevitably affect your capability of making decisions).
What is the full process for the filing of a Lasting Power Of Attorney?
Step one would be to choose your attorney – the person who will be acting on your behalf should you be unable to do so.
Step two is to fill out the forms to register the person chosen as your attorney. You can do this yourself if you have sufficient understanding of the law, but it is usually preferable to have the forms completed by a professional firm such as Castle Estate Solutions or by a solicitor, to ensure they are completed correctly. It is important to note in this regard that errors in the document could lead to serious implications in the future, which is why it is highly recommended to use the services of a professional.
The final step is to register the lasting power of attorney with the Office of the Public Guardian.
The whole process may take up to twelve weeks, which is why it’s essential for you to begin before you become incapacitated. It would be preferable to have set up your lasting power of attorney before you become unable to make decisions yourself.
Who Should Set Up Lasting Powers Of Attorney?
Although lasting power of attorney is a legal facility most commonly used by elderly people, it can benefit anyone over the age of 18.
People of any age can suffer an injury or develop a serious illness. Young people can suffer accidents or develop early-onset conditions. Those who have already been diagnosed with a disease should think seriously about granting powers of attorney before their condition worsens. Doing so will make the situation easier to manage for their loved ones should they lose capacity.
There are various ways that a person might lose capacity, and these can happen at any age. Drug or alcohol abuse, for example, can render someone psychologically impaired and incapable of making good decisions for themselves. You could become comatose as the result of a fall or a motor vehicle accident and need a trusted person to manage things for you. You could have become concussed while playing sports and need someone to carry out your medical wishes. The situations in which a lasting power of attorney would be needed are many and various.