What happens if I become unable to make decisions for myself?
It is completely understandable that most people do not want to think about what would happen to them should they ever fall ill or be involved in an accident, and be left unable to manage their own affairs and make their own decisions.
Many of you will be aware of Kate Garraway, the well-known presenter on Good Morning Britain and lots of you will have watched her documentary ‘Kate Garraway: Finding Derek’, which highlights the practical and emotional struggle loved ones can face when they are unprepared for the worst.
As well as the heartbreak and suffering Kate and her children had to face following her husband becoming incapacitated due to contracting Covid-19, this was only compounded because Derek didn't have a Lasting Power of Attorney. Kate couldn’t access his bank or credit card accounts, their joint savings, nor refinance the mortgage. When the family’s mobile phones broke, she was charged almost £900 for replacement handsets that would have been free had her husband, the account holder, been able to sign the paperwork. The knock-on effect was serious: she had to rely on friends’ financial support. But this is not an isolated case, with normal, every day people facing the same struggles on a daily basis.
As well as planning for the unexpected, many of us are living much longer than ever before, advancing well into our eighties and even older. But sadly with this increase in life expectancy is the increased risk of developing Alzheimer's dementia. This can be shown to dramatically increase with age with 3% of people age 65-74, 17% of people age 75-84 and 32% of people age 85 or older having Alzheimer's dementia. There are currently 944,000 people with dementia in the UK. This will increase to over one million by 2030 and over 1.6 million by 2050.
1 in 3 people born in the UK this year will develop dementia in their lifetime.
In this blog, we look at what you can do to now, whilst you still can; to plan ahead and take the appropriate steps to protect you, your assets and belonging and more importantly your loved ones.
So, what happens if I lose capacity without having made an LPA?
If you were to lose capacity and could no longer manage your affairs, your loved ones would have to make an application to the Court of Protection for an individual known as a deputy to be appointed to manage your affairs.
Although a deputy can be appointed to make property and financial affairs decisions or health and welfare decisions, in a similar way to an LPA attorney, the Court may choose to appoint someone you wouldn't have wanted and depending on the circumstances, they may choose to appoint a professional who will of course charge fees throughout the whole time they are appointed.
The process of applying to the Court of Protection is complex, time-consuming and expensive, which could be avoided by making sure you prepare a Lasting Power of Attorney.
A Lasting Power of What?
A Lasting Power of Attorney (LPA) is a legal document that allows you to appoint one or more people you trust to manage your affairs and make decisions on your behalf. These people are known as attorneys or donees. When you make an LPA, you are known as the donor.
LPAs were introduced by the Mental Capacity Act 2005 on 1st October 2007 and replaced the old enduring powers of attorney (EPAs).
But what about my Enduring Power of Attorney?
While existing EPAs continue to be valid, it has not been possible to make a new EPA since 1 October 2007.
Which type of LPA would I need?
There are two forms of LPA:
one to deal with property and financial affairs
the other to deal with health and welfare issues
The two types of LPA are independent and you may appoint different people to act as attorneys under each type of LPA. An LPA can only be used once it has been registered with The Office of the Public Guardian.
What are the advantages of putting an LPA in place?
Once an LPA has been registered with the Office of the Public Guardian (OPG), it is available for use immediately so, in the event of a sudden or unexpected loss of capacity, your attorney(s) would be able to step in immediately to take over the management of your affairs and take decisions on your behalf.
Control and Choice
When you make an LPA, you can choose who you would want to deal with your affairs when you are no longer able to do so yourself. You can choose whether to appoint one or more attorneys and specify how joint attorneys are to make decisions. You can even appoint replacement attorney(s) to act in the event that your first choice is not able to act for any reason. You are free to appoint a family member, friend, a professional, or a combination of these. You can also include preferences or instructions within the LPA form to guide your attorneys as to how you would like them to exercise their powers.
Less expensive than deputyship
It costs less to register an LPA with the OPG when compared to an application to the Court of Protection to appoint a deputy. In addition, a professional’s fee for dealing with a deputyship application would typically be much higher than to create and register an LPA.
A property and financial affairs LPA can be used at your direction whilst you are still mentally capable. This could be useful if you are out of the country for an extended period of time or find yourself physically incapacitated but mentally capable of taking decisions. Unlike a property and financial affairs LPA, a health and welfare LPA can only be used if you are incapable of taking the relevant decision yourself.
Who should I choose as Attorney?
Choosing who to appoint as attorney is the most important part in the process of making an LPA as the attorney will be the person making decisions about your property and financial affairs and/or your health and welfare should you become incapacitated. Acting as an attorney is an important role and you should choose someone they trust who knows you well enough to make decisions that are in your best interests. There is no limit to the number of attorneys that may be appointed, although the higher the number, the more difficult it can be to effectively to manage the donor's affairs. Once you have decided whom you would like to appoint as your attorney(s), it is important that you talk to these individuals to ensure they are comfortable taking on the role of attorney.
So we have donors and attorneys, what are Certificate Providers?
The certificate provider has a very important role - they act as an independent individual who signs the LPA form to confirm that they have discussed the LPA with you and that, in their opinion, at the date of creation of the LPA you understand the purpose of the LPA, that no fraud or undue pressure is being used to force you to create the LPA against your will and that there is nothing else that would prevent the LPA from being created.
When can I make a LPA?
Provided you are over 18 and have sufficient capacity, you can make your LPA. My advice would always be to do it sooner rather than later, because you never know what later might have in store. If you would like to find out more about Lasting Powers of Attorney, then please feel free to contact us.