Prudent planners arrange their affairs to take account of circumstances which might arise in the future. They consider what might be needed if they become ill or are involved in an accident. They will have made Enduring Powers of Attorney (EPAs) or Lasting Powers of Attorney (LPAs) to ensure that someone has the authority to take over and manage their finances if they need help. These powers of attorney can be used in any situation but they are specifically designed to continue to be effective if the person who has made the power (the Donor) has lost capacity and can’t give instructions.

EPAs were replaced by LPAs on the 1 October 2007 but an EPA made before that date continues to be effective. EPAs (made before October 2007) and LPAs are equally valid. Although they serve the same purpose, the documents are very different; an EPA is usually only 4 or 5 pages long while an LPA can be 22 pages or more! The regulatory systems are also different; for example a LPA can’t be used by the appointed attorney until it has been registered with the Office of the Public Guardian, but an EPA only needs to be registered if the Donor is becoming unable to manage. A Donor who is housebound or in hospital will want help with their finances and an unregistered EPA can be used. The EPA should not be registered as the Donor has capacity.

Anecdotal evidence suggests that this careful planning is being thwarted by banks and other financial institutions. Frontline staff don’t seem to understand what they are dealing with and consequently refuse to accept the document presented to them. Attorneys appointed by an EPA are finding that bank officials don’t know what EPAs are and they are told that “powers of attorney are long documents” or that a power of attorney has to be registered before it can be used.

Attorneys have also been asked to produce the original EPA or LPA, although properly certified copies are effective and it is impractical to use the original. The original deed should be kept in a safe place and should not be used to prove the attorney’s authority as it could be lost or damaged. If the Donor doesn’t have legal capacity any more, an EPA or LPA which has been lost can’t be replaced!

Some institutions have imposed arbitrary requirements of their own which the attorney only discovers when he tries to notify the institution that he is the Donor’s attorney. Others refuse to accept powers of attorney of any kind.

The law is very clear. EPAs made before 1 October 2007 are valid. The Powers of Attorney Act 1971 states that any power of attorney, including EPAs and LPAs, can be proved by means of a copy. Each page of the copy must be certified that it is a true copy of the corresponding page of the original document. The certificate can be signed by the Donor, a solicitor, a notary public or a stockbroker. No other requirements are made in the Act. It is advisable for the person who certifies the copy to give his or her address and status so that they can be contacted should it be necessary for the copy to be verified.

The moral of the tale for attorneys experiencing such difficulties is ‘stand your ground’. Ask to see someone more senior or suggest that the person consults their legal department. Donors who have made an EPA or a LPA may like to check their bank’s policy and be ready to move elsewhere if they are not happy with the response.

Of course financial institutions can make their own rules – but they should take their customers’ needs into account. At the very least they should allow a customer’s attorney to withdraw the Donor’s money or transfer his accounts to a more accommodating institution without undue difficulty or delay.

It is not just with the initial notification where there have been problems. It seems some institutions have identified accounts being administered by attorneys as ‘joint accounts’ which leads to a whole range of further problems!

Solicitors are working with the banking industry, the Office of the Public Guardian and others to produce standard guidance for bank staff. The guidance will explain the nature and effect of EPAs and LPAs and, once agreed and implemented, should reduce these kinds of problems in the future.

It is very important that these difficulties are addressed quickly as the number of EPAs and LPAs being used is growing. In 2010/11 the Office of the Public Guardian dealt with the registration of 180,200 EPAs and LPAs compared to 116,000 registrations in 2009/10.