Changing an Enduring Power of Attorney
Mental incapacity can affect us all at any point in our lives whether through illness, accident or simply old age. But ensuring you have thought about who you would like to deal with matters for you if such an event were to occur, and putting in place the appropriate documents to give them the authority to do so, means that you can relax in the knowledge that your affairs in are order. This article will provide a brief guide to the different types of powers of attorney and how they can be used.
What is a Power of Attorney?
A Power of Attorney is a document by which the person making the Power of Attorney (the donor) delegates to their chosen persons (the attorneys) the authority to make decisions about matters on their behalf.
Different types of Power of Attorney
There are three main types of Power of Attorney, a general power of attorney, an Enduring Power of Attorney (EPA) and a Lasting Power of Attorney (LPA) but which do you need?
General Powers of Attorney
A general power of attorney is only useful whilst the donor retains mental capacity to authorise the actions of the attorneys and so can be helpful if someone is going to be abroad or physically unable to sign documents for a period when decisions need to be made. If the donor loses mental capacity at any time a general power of attorney ceases to be able to be used.
Enduring Powers of Attorney
Since 30 September 2007 it has not been possible to make a new EPA. However, validly made EPAs made before 1 October 2007 remain effective. Under an EPA it is possible to delegate powers to manage your property and financial affairs to your attorney but an EPA only deals with financial matters and doesn’t deal with any health or welfare matters.
An EPA can be used in the same way as a General Power of Attorney until such time as the donor loses capacity to manage their property and affairs. At that point, the EPA can only continue to be used once it has been registered by an application to the Office of the Public Guardian. Once it is registered, the attorney can act under it without any further recourse to the donor although all actions and decisions made must be made in the best interests of the donor.
If you already have a valid EPA dealing with your property and financial affairs, you can keep it but there may be reasons why you would want to change it to a Lasting Power of Attorney.
Lasting Powers of Attorney
It has been possible to make Lasting Powers of Attorney since 1 October 2007. There are two types: a health and welfare LPA; and a property and financial affairs LPA. Either type of LPA can be used by the attorney to make decisions after the donor lacks capacity to make such decisions.
Under a health and welfare Lasting Power of Attorney you can delegate decision making over your personal welfare including whether to give or refuse consent to medical treatment and deciding where you are to live. It is possible to put restrictions in the Power of Attorney limiting your attorney’s decision making powers if you wish and you can also tell your attorney of your own views and wishes which can be set out in the document about how decisions should be made.
Under a property and financial affairs Lasting Power of Attorney you can give your attorney power to do anything you could do yourself in relation to your financial matters which might include opening and closing and operating bank accounts, claiming and receiving benefits and making tax returns. An attorney could also sell a property for you. An attorney cannot, however, make a new will for you or do certain other things such as voting in elections and there will be limited power to make gifts.
Under powers of attorney, your attorneys must act in your best interests and have regard to the Code of Practice set out in the Mental Capacity Act 2005.
Unlike an EPA which can be used before it is registered, an LPA must be registered before it can be used. There is a cost of registration of £82 per LPA and the Office of the Public Guardian keeps a register of LPAs which are registered and has responsibility for reviewing the actions taken by the attorneys.
Who can I appoint as my attorneys?
Under a Lasting Power of Attorney you can appoint anyone as your attorney as long as they are over 18 years old and, in respect of property and financial affairs, not a bankrupt. You can appoint your spouse or civil partner or your children if they are old enough. Your attorney does not have to live in England and Wales although it may be inconvenient practically if they are living overseas. Clearly it is important you appoint someone you can trust. You can also choose professionals as your attorneys and you can appoint different attorneys for health and welfare than you do financial matters.
You can also appoint a replacement attorney who can step into the shoes of your initial attorney should they become unable to act for you for some reason.
Can I appoint multiple attorneys?
You can appoint more than one attorney and if you do, you must specify how they are to act. If you specify they are to act jointly then they must make decisions unanimously and if one of the joint attorneys can no longer act for any reason the appointment is no longer effective. Alternatively you can appoint your attorneys to act jointly and severally and then one or other attorney can act alone on your behalf. There is also a hybrid option in which you can specify particular decisions that are to be made by your attorneys together, whilst other decisions can be made by them acting separately.
When to change from an EPA to an LPA
An LPA has several clear advantages over an EPA:
- it extends the range of decisions which a donor can delegate to an attorney;
- it allows you to appoint replacement attorneys;
- in acting under a Lasting Power of Attorney the attorney must have regard to the principle that the person must be able to make decisions for themselves wherever possible and therefore consider whether or not the donor can make a particular decision before making it for them.
If you already have an EPA dealing with your property and financial affairs and you are sure that it is valid and it appoints the persons that you wish to appoint as your attorneys, then you can keep it and simply make a new LPA to deal with health and personal welfare issues if you wish.
Applying for a Lasting Power of Attorney
There is a formal process through which Lasting Powers of Attorney must be made and registered and all the relevant forms can be found online. You do not need a solicitor to make an LPA although it is often best to seek expert advice to ensure that you have thought through all of the issues and are sure about the effect of the documents you are signing.
We have a lot of experience in this area and would be happy to advise you.