Why do I need a Lasting Power of Attorney (LPA)?

There may come a time when you lose the ability to manage your financial affairs or make decisions about your own health and welfare. That could be due to a serious accident, dementia, or some other condition affecting your mental capacity.

In such circumstances, your family do not automatically have the legal authority to step in and manage your affairs. Without an LPA, your family would have to make an expensive and time-consuming court application.

When should I create an LPA?

An LPA is an important way of planning for the future. You can only make an LPA while you still have mental capacity.

An ordinary power of attorney will not work because it automatically becomes invalid if you lose your mental capacity.

What is an LPA?

An LPA is a legal document which allows you to appoint one or more people to have legal authority to act on your behalf should you lose the ability to make decisions for yourself. These people are called your attorneys.

There are two types of LPA:

  • Property and Financial Affairs LPA
  • Health and Welfare LPA

What is a Property and Financial Affairs LPA?

This LPA gives your attorneys authority to make decisions on your behalf about your Property and Financial Affairs.

For example, this LPA will give your attorneys the power on your behalf to:

  • Buy or sell your property.
  • Open, close or operate your bank, building society and other investment accounts.
  • Access your financial information.
  • Claim, receive and use all benefits, pensions, allowances and rebates.
  • Receive any income, inheritance or other entitlement.
  • Deal with your tax affairs.
  • Pay your mortgage, rent and household expenses.
  • Insure, maintain and repair your property.
  • Invest your savings.
  • Make limited gifts to your family and friends on birthdays, weddings and other appropriate occasions and continue regular donations to charity.
  • Pay for private medical care and residential care or nursing home fees.
  • Apply for any entitlement to funding for NHS care or nursing home fees.
  • Use your money to buy a vehicle or any equipment or other help needed.
  • Repay interest and capital on any loan you have taken out.

When can my attorneys use a Property and Financial Affairs LPA?

Your attorneys can only use the LPA after it has been registered by the Office of the Public Guardian.

Once your Property and Financial Affairs LPA is registered your attorneys may use their powers while you still have mental capacity. For example, if you were to find it difficult to get out and about or to talk on the telephone, or if you were out of the country for a long period of time, you may wish for an attorney to manage some or all of your affairs.

Should I think about restricting my Property and Financial Affairs attorneys in any way?

A Property and Financial Affairs attorney can have wide-ranging powers. However, it is possible to specify restrictions and conditions as well as give your attorneys written guidance on what to take into consideration when making decisions on your behalf.

For example, you might wish to:

  • Add a condition that the attorneys must act or not act in a particular way, for example, specifying that the attorneys cannot make any gifts.
  • Add a condition that the attorneys must keep accounts of how they spend your money and submit them to someone you choose as a safeguard.
  • Add a condition that the attorneys must make charitable donations on your behalf.
  • Include a restriction that the attorneys cannot make certain types of investment on your behalf.

There is no suggested wording for restrictions and conditions. The wording should be straightforward, easy to understand and capable of being put into practice. If restrictions and conditions are too complicated or are not possible to satisfy, there are likely to be delays in registering the LPA and the Court may need to become involved. For more complex wishes, you may prefer to set out instructions to your attorneys as non-binding guidance rather than formal restrictions. Generally we do not recommend imposing restrictions and conditions where you have complete faith and trust in your attorneys.

Will my Property and Financial Affairs attorneys know what is in my Will?

You should think about giving your attorneys express permission in your Property and Financial Affairs LPA to see a copy of your Will. This is because your attorneys are not entitled to have access to any Will or codicil you have made unless you have included this as a condition in the LPA. For example, your attorneys may want to sell valuable personal assets belonging to you, but you may have specifically left those assets to someone in your Will. If your attorneys were unaware of this, that person could suffer serious loss. If you do not include this permission in your LPA, your attorneys may be forced to make an expensive application to the Court to see your Will, or they could accidentally dispose of important items without realising the consequences.

Can my Property and Financial Affairs attorneys make a new Will on my behalf?

No, attorneys cannot make a new Will or amend an existing Will on your behalf. If you lack mental capacity and an amendment to your Will is needed, the attorneys will have to apply to the Court of Protection for what is known as a statutory Will.

What is a Health and Welfare LPA?

This type of LPA allows you to choose people to act on your behalf and make decisions about your health and personal welfare, when you are unable to make decisions for yourself.

Your attorneys may make decisions about your medical treatment, but the attorneys cannot make decisions about life-sustaining treatment unless you specifically state this in your Health and Welfare LPA. Decisions your attorneys can make on your behalf might include:

  • Medical matters (for example, giving or refusing consent to medical examination and treatment).
  • Arrangements needed for you to be given medical, dental or optical treatment.
  • Where you should live and who you should live with, including perhaps moving into sheltered housing or a care home.
  • Your day-to-day care, including what to eat and what to wear.
  • The assessment and provision of any community care service.
  • Accessing personal information about you such as medical records or legal records.
  • Whether you should take part in any social, leisure or educational activities including taking you on holiday or authorising someone else to do so.
  • Your personal paperwork and any correspondence received.
  • Complaints about your care or treatment.

When can my attorneys use a Health and Welfare LPA?

Your attorneys can only use the LPA after it has been registered by the Office of the Public Guardian.

This LPA must not be used by your attorneys until you have lost capacity.

Should I think about restricting my Health and Welfare attorneys in any way?

You can give your attorneys written guidance in the LPA on what matters to take into consideration when making decisions. This should be in addition to discussing the matters with the attorneys when you appoint them. Your attorneys are obliged to help you make as many of your own decisions as possible.

You might wish to consider restrictions and conditions on the authority of the attorneys in this LPA, for example:

  • Preventing your attorney making decisions about the treatment of an illness that you already have when you sign your LPA.
  • Requiring your attorney to consult with a particular person about specified decisions, such as where you should live.
  • Including a restriction that your attorney can only make decisions about your social care and not health care.
  • Stating that the attorney does not have the authority to decide who can contact or visit you.

Just as with the Property and Financial Affairs LPA, there is no suggested wording for restrictions and conditions. The wording should be straightforward, easy to understand and capable of being put into practice. If restrictions and conditions are too complicated or not possible to satisfy, there are likely to be delays in registering the LPA and the Court may need to become involved. For more complex wishes, you may prefer to set out instructions to your attorneys as non-binding guidance rather than formal restrictions. Again, we generally recommend against imposing conditions and restrictions where you have complete faith and trust in your attorneys, unless you feel very strongly about a particular issue.

What does life-sustaining treatment mean?

Life-sustaining treatment is any treatment that a doctor considers necessary to sustain life such as a major surgical operation or an organ transplant. Lifesustaining treatment can also include day-to-day treatment such as a course of antibiotics if, for example you might otherwise develop pneumonia, or artificial nutrition or hydration. The important factor is whether the treatment is necessary to keep you alive.

The decisions you authorise your attorneys to make for you in your Health and Welfare LPA take the place of any advance decision (sometimes referred to as a “living will”) you have already made on the same subject.

You must be clear in your Health and Welfare LPA whether or not you want to give your attorneys the authority to make decisions about life-sustaining treatment. This is very important so please be clear about the choice you are making. You might wish to discuss this first with your attorneys or doctors and health professionals. If you decide not to give your attorneys such authority, your doctors might still take into account, where practical and appropriate, the views of your attorneys and people who are interested in your welfare as well as any written statement you may have made about life-sustaining treatment.

Who should I appoint as my attorneys for either type of LPA?

For each type of LPA you should make sure you choose adult attorneys who you can trust to act in your best interests and who have the skills and ability to carry out the necessary tasks. For each type of LPA you should generally appoint at least two attorneys or one attorney and a replacement in case the chosen attorney cannot act.

The people you choose as attorneys under your Property and Financial Affairs LPA must not be bankrupt. You can appoint a professional lawyer or accountant as your attorney. Mishcon de Reya can offer this service.

You can appoint your spouse or civil partner as your attorney but the appointment will be revoked automatically if your marriage or civil partnership ends. If they were the only attorney appointed, this would mean that you would need to create a new LPA. This could cause problems if you had already lost capacity. There could also be problems if this situation occurs and your spouse or civil partner is appointed jointly (as opposed to jointly and severally) with another attorney (please see below).

If you own your property jointly with your spouse or civil partner you should avoid appointing them as your only attorney because this can cause problems if your property is sold in the future.

Your attorneys can choose to stop acting at any time in the future. You should plan for co-attorneys and substitutes so that you will always have a valid attorney.

How many attorneys can be appointed?

For each type of LPA you can appoint as many attorneys as you wish. We would not usually recommend more than two or three, as any more can make decisionmaking and accountability difficult. If you appoint more than one attorney you should think about whether you would like your attorneys to act:

How can my attorneys make decisions on my behalf?

1. Jointly

This means that the attorneys must make all decisions together. This can delay decisions that need to be made at short notice. Also, if the attorneys cannot agree, or if one of them can no longer act as attorney for example because of divorce, death or loss of mental capacity, the LPA may have to be cancelled.

2. Jointly and severally

This means that attorneys can make decisions either together or separately. This might be useful, for example, if one attorney is not available to make a decision at a certain time. If one attorney cannot act, the remaining attorney is able to continue to make decisions. This means that if, for example, one attorney dies then the LPA can continue. However, there may be a risk of decisions being taken which are not approved by all your attorneys.

3. Jointly for some decisions, and jointly and severally for other decisions

This means that your attorneys must make certain decisions together whilst they can make other decisions either together or separately. You will need to set out clearly how you want this to work in practice and it is not generally recommended

Can I appoint a substitute or replacement attorney?

For each type of LPA you can appoint a replacement attorney or attorneys.They would only act if one or more of your original attorneys died, became bankrupt, chose not to act, lacked mental capacity or you had divorced them or dissolved your civil partnership. You can appoint a replacement for all of your original attorneys, or you can specify that you wish your replacement only to replace a specific attorney.

You do not have to appoint any substitutes. However, if you only appoint one attorney and you do not appoint a substitute, your LPA will end when your only attorney can no longer act. You will then need to create a new LPA. You will only be able to do so if you have mental capacity at that time. You cannot appoint replacement attorneys after your LPA has been signed. You also cannot appoint replacements for your replacement attorneys. Your attorneys cannot be given the power to appoint replacement attorneys themselves.

Your replacement attorney will need to inform the Office of the Public Guardian before being entitled to act on your behalf.

Will my attorneys be paid for acting on my behalf?

For each type of LPA the default position is that attorneys are only entitled to be reimbursed for out-of-pocket expenses incurred in carrying out their duties. Professional attorneys such as solicitors or accountants will charge for their services. If you would like to pay your nonprofessional attorneys to act then this should be recorded in the document. You should discuss payment with your attorneys and you may wish to record in your LPA any agreement made to avoid any confusion later.

What do I need to know about the “notifying people” section in the questionnaire?

You can specify “people to be told” in each type of LPA. These are people who you would like to be notified that registration of your LPA is taking place. This gives people who know you well an opportunity to raise any concerns or objections before your LPA is registered and can be used.

If a person to be told has concerns about registration, they can object on certain grounds. This will delay registration while the court makes enquiries. In the unlikely event that an objection is made, we can advise on what steps should be taken.

You can name up to five people to be told of registration. If you do not name anyone, then two certificate providers are required when completing the LPA rather than one (see below).

Who are the certificate providers?

For each type of LPA a certificate provider is someone who must make a declaration in your LPA that:

  • You understand the purpose and scope of the LPA;
  • No fraud or undue pressure is being used to induce you to make the LPA; and
  • There is nothing else that would prevent the LPA from being created. The certificate provider must also confirm that he/she has discussed with you the contents of the LPA without your attorneys being present.

There are two types of people that can provide a certificate for your LPA:

  • Knowledge-based certificate provider;
  • Skills-based certificate provider.

A knowledge-based certificate provider is someone independent who has known you for the past two years. A skills-based certificate provider is someone who has relevant skills and expertise such as a solicitor, barrister, healthcare professional or registered social worker.

The certificate provider cannot be:

  • An attorney or replacement attorney of this LPA or any other valid LPA or enduring power of attorney you have made;
  • A member of your family or your attorney’s or replacement attorney’s family;
  • Your business partner or employee or a business partner or employee of your attorney or replacement attorney; or
  • An owner, director, manager or employee of a care home where you live or a family member of any of those people.

How does an LPA become valid?

For each type of LPA there are specific rules that govern how the LPA is signed by you, your certificate provider(s) and your attorneys. These must be followed very carefully.

The signed LPA must then be registered before it can become valid. Your attorneys must not act under an LPA until it has been registered.

We would normally recommend that you begin the registration process immediately after your LPA is signed. That will avoid any delay in your attorneys being able to make decisions on your behalf at a time when they might need to act urgently. You will need to sign additional registration forms for each LPA, which we will prepare on your behalf.

We will also arrange for notices to be sent to the “people to be told” when the application to register your LPA is made. The Office of the Public Guardian will also notify your attorneys that the LPA is being registered and they will also have an opportunity to object.

The registration process takes a minimum of 4 weeks and can take considerably longer. If registration is not carried out immediately after the LPA has been signed then there is a risk that if the attorneys need to act urgently on your behalf, they will be unable to do so. Just because the LPA is registered, there is no need to use it. In fact there is usually a long delay between the LPA being registered and it being used by your attorneys.

Will my LPA be valid in other countries?

Both types of LPA will be valid in England and Wales but they might not be accepted in other countries. If you have links with other countries or you own property or investments in other countries, you should let us know. Equally, if you spend significant time outside the UK you should inform us and we can coordinate any advice required in other countries where appropriate.

Can my attorneys do whatever they like once they start acting under my LPA?

Even if there are no conditions or restrictions in your LPA, your attorneys cannot do whatever they like. They are still governed by a set of principles which ensure your best interests are protected.

What is meant by “my best interests”?

For each type of LPA your attorneys must act in your best interests in making decisions for you when you are unable to make the decision yourself.

They must take into account all the relevant circumstances.

This includes, if appropriate, consulting with you and others who are interested in your welfare. Any guidance you add may assist your attorneys in understanding your views and identifying others who are interested in your welfare. Your attorneys should also consider your past wishes and your religious beliefs.

Can I change my LPA at any time?

Neither type of LPA can be changed once it has been made, even if it has not been registered. If your circumstances change, you will need to cancel your original LPA and make a new one.

Can I cancel my LPA at any time?

You can cancel an LPA at any time before or after it is registered as long as you have mental capacity to cancel it.

If your LPA has been registered, you will need to inform the Office of the Public Guardian that you are cancelling your LPA so they can remove it from their register.

You will also need to inform your attorneys and any third parties who take instructions from your attorneys, for example your bank.

You should let us know if you want to cancel your LPA as we recommend doing so with a formal deed of revocation. Otherwise there can be uncertainty as to whether the LPA has been validly cancelled.

Cancellations will not invalidate decisions previously made by your attorneys.

I’m currently a director of a company or a trustee of a trust. Can I use my LPA to delegate my directorship or trusteeship to my attorneys?

Special rules apply where you are a director or trustee. If you intend to delegate these functions please speak to us and we will advise you further.