You already know that it's a good idea to make a will to provide for your assets after your death, but what if during your own lifetime you become unable to manage your own affairs? Well, that's where an enduring power of attorney can help, as Paul McCutcheon explains.

Life is what happens when you're busy making other plans. You can't be ready for every eventuality and if you happen to become incapacitated, it would be a comfort to know that you have someone acting in your best interests. An enduring power of attorney (EPA) ensures that your wishes about who is to manage your affairs and make personal decisions on your behalf if you become unable to manage your own affairs are acted upon.

It gives you 'the disponer' the freedom to nominate a person (known as an 'attorney') to manage your affairs in the event that you become mentally incapable of doing so. Without an EPA in place, if you become mentally incapable, it may be necessary to make you a ward of court. The wardship procedure is complex, cumbersome and expensive and it could end up with the court appointing a person that you might not wish managing your affairs. In addition, the High Court would have the final say on everything affecting your health and welfare.

In creating an EPA, the disponer can make the scope of his Attorney's powers as wide or as narrow as he or she wishes. Generally, powers created under an EPA are split into two main areas; business and finance, and personal care.

  • Business and financial affairs. You can give the attorney authority to do anything that you could lawfully do. Alternatively, you can limit the attorney's authority as you think fit. Limiting the authority should be carefully considered as it may prevent the attorney taking very necessary action on your behalf. The attorney may also be authorised to provide for your family or other dependents, if you so wish.
  • Personal care decisions. The attorney can also be given the power to make personal care decisions such as where you live, what you do on a day-to-day basis and who you see.

The procedure for creating and subsequently registering an enduring power of attorney incorporates a number of safeguards to prevent abuse and misapplication of the EPA procedure. For example, the disponer must notify at least two people, known as 'notice parties', that he or she has created an EPA. Neither of the notice parties can be an attorney under the EPA. At the time of signing the EPA, a doctor must certify that the disponer has the mental capacity to understand the effect of creating the EPA and the disponer's solicitor must also certify that his client understands the effect of creating an EPA and is not executing it as a result of fraud or undue pressure.

Once executed, the EPA will only take effect once the disponer has become mentally incapable and the EPA has been registered in the High Court. Prior to registration, the disponer must be notified formally that his or her attorney intends to apply for registration and a doctor must certify that the disponer is mentally incapable of managing his or her own affairs. The notice parties will also have to be formally notified that the attorney intends to register the EPA and, after making the relevant notifications, the attorney will need to wait for five weeks before the EPA can be registered to allow the disponer or the notice parties to object to the registration, if necessary.

Without an enduring power of attorney in place, no-one has the power to administer your affairs for you if, for whatever reason, you lose the power to do so yourself. An EPA should be regarded as an insurance policy against a scenario we would all hope to avoid and, like all insurance policies, will hopefully never be needed. However, given the advantages of having an EPA in place, and the potential consequences if one has not been executed, it is clearly an essential safeguard for people of all ages.