Setting up a Lasting Power of Attorney
Khushi Kanodia
Solicitor
We often find ourselves in unpredictable circumstances. Illness, accidents, or age-related conditions can affect one’s mental capacity. When that happens, having a Lasting Power of Attorney (LPA) in place will immensely assist you and your loved ones.
What is Mental Capacity?
Having mental capacity implies that you can make decisions and understand their consequences. If you lack mental capacity, it means that you are unable to understand the information relating to a decision, remember information long enough to make a decision, weigh up the consequences of a decision or communicate the same.
Making a bad or strange decision does not necessarily mean one lacks capacity. In many individuals, capacity might fluctuate depending on the circumstances and diagnosis. They may be able to make decisions at certain times, and be unable to do so otherwise. There are processes and guidance in place to assess capacity.
More about capacity: https://www.gov.uk/make-decisions-for-someone/assessing-mental-capacity
What is a Lasting Power of Attorney (LPA)?
A Lasting Power of Attorney is a legal document that allows you to appoint someone you trust as your attorney. The attorney will, in turn, make decisions on your behalf if you become unable to do so. You can appoint one attorney or more than one to act jointly or jointly and severally.
Appointing attorneys jointly means that they must all work together for each decision, making the case for a collective agreement. Whereas jointly and severally means that the attorneys can act together or individually. This set-up allows any of the attorneys to make decisions without needing the others’ approval.
There are two types of LPAs:
1. Financial Affairs LPA
This allows your attorney to manage your finances, including:
- Paying bills and mortgage
- Managing bank accounts and investments
- Selling or renting property
2. Health and Care LPA
This enables your attorney to make decisions about:
- Medical treatment
- Living arrangements
- Care and support arrangements
- Life-sustaining treatment, if you have allowed for this
You can set up one or both types of LPA, depending on your needs. However, each LPA requires a separate application.
You can choose when a Financials LPA comes into effect. You can choose to have the power vested either as soon as the LPA has been registered or only once you are deemed to no longer have capacity. By contrast, a Health and Care LPA can only come into effect if you no longer have mental capacity.
Why Having an LPA is Essential
Many people assume that their spouse or children can automatically make decisions for them if needed, but they legally cannot unless they have been appointed under an LPA.
Without an LPA in place, your family may have to make a deputyship application to the Court of Protection, which can be a long and expensive process. If your family is unable to make decisions on your behalf, it may lead to delays. In financial matters, delays could mean being unable to pay for care and decisions regarding your health and care may be made by the professionals relevant to your circumstances.
An LPA ensures that your affairs are handled by someone you choose and trust, in line with your personal values and preferences.
When Should You Set Up an LPA?
An LPA should be set up as early as possible. An LPA can only be set up while you have full mental capacity. Planning ahead avoids legal complications later and gives you peace of mind.
Whether you are updating your will, entering retirement, or just thinking ahead, setting up an LPA is an essential part of getting your affairs in order.
How We Can Help
We offer advice on all aspects of LPAs. If you would like to create a Lasting Power of Attorney or wish to understand your options, our legal team is here to help. You can call us or request an initial consultation online.
For specialist advice and support. Please get in touch with our corporate solicitors in London by contacting the GOOD LAW INTL office.
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