Financial matters for the older client including powers of attorney

So what does your future hold?

Some may live a long life, able to manage their affairs with confidence throughout. Some may not be as lucky, may suffer an accident, a breakdown, brain injury or just simply get old and frail. So it makes sense to prepare for the possibility of future incapacity to ensure your views and wishes are still respected and followed.

You could make informal arrangements by, perhaps, asking a trusted friend or relative to be a signatory on your accounts or arrange for someone, for instance, to collect your pension/benefit. However, informal arrangements may not be acceptable to some organisations. More formal arrangements provide greater safeguards against possible abuse. Such "formal" arrangements are set out below.

An ordinary power of attorney

This is a legal way of giving someone else power to manage your affairs when it is difficult for you to manage them yourself, perhaps because of a physical disability. The person you appoint will be your "Attorney" and can be a friend, relative or a professional person. Nobody can simply "take" a power of attorney. You have to "donate" it willingly. This power of attorney only applies if you are fully aware of the implications of the arrangement. The power of attorney will come to an end if you become mentally incapable of managing your financial affairs .

A lasting power of attorney

A Lasting Power of Attorney goes one step further than an Ordinary Power of Attorney because it continues or "lasts" even after you have become mentally unable to manage your affairs—whether temporary or permanently for whatever reason. Lasting Powers of Attorney have replaced Enduring Powers of Attorney, although valid Enduring Powers of Attorneys made pre– 1st October 2007 can still be used. No new Enduring Powers of Attorney can be created.

For a Lasting Power of Attorney to be valid you must fully understand the implications of the arrangement at the time of making it. An appropriate person will need to sign a certificate to say that you are aware of the implications of creating the Lasting Power of Attorney and that nobody was pressurising you to make the power. The person providing the certificate must be someone who has known you for two years or who is skilled in assessing if a person has capacity. The attorney (s) must be at least 18 years old and must not be a bankrupt person themselves. You can appoint more than one attorney.

What happens after the LPA is created?

Once the Lasting Power of Attorney has been signed it has to be registered at the Office of the Public Guardian before it can be used. The Office of the Public Guardian will make sure that the Attorney(s) is(are) aware of his/her/their duty to act in your best interests. Before the Power of Attorney is registered notice of the intention to register the Power of Attorney will be given to people whom you have nominated to receive such notice. You can nominate up to five people to receive the notice.

Types of lasting powers of attorney?

There are two types of Lasting Powers of Attorney. There is the Property and Affairs Lasting Power of Attorney which can be registered even if the person granting the Power of Attorney is not mentally incapacitated.

There is also a Lasting Power of Attorney—Personal Welfare. This is a separate document wherein the Attorney can be "given", by you, the right to make personal welfare and medical treatment decisions on your behalf if at some time in the future you are unable to make those decisions yourself. This type of Power cannot however be registered at the Office of the Public Guardian until mental capacity to make those types of decisions yourself has been lost.

The court of protection

If someone is mentally incapable of making a particular decision at a particular time and they haven't made a Lasting Power of Attorney and the decision isn't one which can be made on an informal basis, the matter can be referred to the Court of Protection. The Court may either choose to make the decision itself on the person's behalf, or choose someone else, known as a "deputy" to make the decision for them. When the Court appoints a deputy to manage someone’s affairs on an ongoing basis the deputy usually has to keep accounts, enter into a security bond and report to the Office of the Public Guardian. The Court of Protection charges a one off application fee and the Office of the Public Guardian charges a yearly fee to cover the cost of supervising the deputy's work.

What is appointeeship?

If a person is incapacitated and entitled to receive a retirement pension or other state benefits, the Department for Work and Pensions can choose an "appointee" to receive those benefits on that person's behalf. The appointee can be a relative, friend or someone from the caring professions (such as local authority social services department). They will be asked to produce some proof that the claimant is incapacitated, such as a Doctor's certificate.

Cost?

Our charges will vary depending on what type of work you wish us to carry out for you. We offer ground floor offices for your ease of access and will do home visits if requested (although there may be a small extra charge to cover such visits). We pride ourselves on being approachable and on explaining matters to you in a manner which you will understand. We will always discuss costs with you before undertaking any work.

We look forward to assisting you!