What is a lasting power of attorney?


Nov 21, 2016
What is a lasting power of attorney?

There are several different legal roles described as ‘power of attorney’.  

They all basically involve someone else being able to make important decisions on your behalf - decisions which are legally binding on you. 

Ability to manage your affairs  

There are two situations within which you may wish to delegate certain elements of the control over all or part of your affairs to another person:

  • you are going to be away physically (perhaps visiting family overseas or in hospital for surgery) and you will not be able to deal with matters such as paying your bills or the signing of a contract. You can award someone the “power of attorney” over specified elements of your finances and other such responsibilities. This is typically constrained by a time limit and for that reason, is sometimes referred to as a “power of convenience attorney” or “temporary power of attorney”. It’s also sometimes called a “general power of attorney” arrangement
  • you feel you might become unable to look after your own affairs – for whatever reason. In such a situation, you can appoint someone with “Lasting Power of Attorney” or LPA. This is essentially an open-ended agreement with a person or group of people who will act on your behalf to protect your interests.

In some cases, a third situation might arise whereby a court appoints someone with LPA over your affairs. That might happen if, for example, you were seriously injured in an accident or suffered a stroke and were unable to communicate.  

Prior to 2007, the LPA was called the “Enhanced Power of Attorney” (EPO) and that role is still legally valid if in force today.  There are differences between the LPA and EPO roles but as no more EPOs were appointed after 2007, we won’t discuss it further. 

Note also that the legal definitions and processes are different in Scotland and Northern Ireland. 

What Lasting Power Attorney means 

You can grant someone total LPA over all of your affairs, some of them or you can split the role over two or more people. 

A common distinction arises when speaking of: 

  • a property and financial affairs Lasting Power of Attorney
  • a health and welfare Lasting Power Attorney. In the former case, the individual (or people) appointed can make immediate decisions over your financial life. Typically they’ll have control over your bank account, property repairs and all such matters. 

In the case of the second LPA, they can make decisions about your treatment including what hospital you’re in, what treatments may or may not be used and all related matters. In the case of this type of LPA, due medical and legal process must agree that you are unable to make decisions for yourself before the LPA can exercise their powers. 

You can appoint several LPAs and the law requires that they consult and agree with each other when making decisions on your behalf. 

Regulation  

Setting up an LPA isn’t difficult – in mechanical terms at least. The Government website has a step by step guide as well as online forms you can complete in order to create (or end) an LPA. 

Online forms can be completed and you, as the ‘donor’, will need your signature plus those of the individuals proposed as having LPA to be formally witnessed by unbiased and uninvolved third-parties.  

Once completed, your forms and nominations must be registered with the Office of the Public Guardian (OPG) and there is typically an 8-10 week delay before the official confirmations come through. During their exercise of the LPA, any individual can be reported to the OPG for investigation should they be perceived to be acting inappropriately. 

The penalties for misuse of an LPA are severe. 

Advice on setting up a Lasting Power of Attorney

Setting up an LPA is a formal legal procedure and needs to be carefully considered. The issues involved may be complicated. As it is such an important document, if you are unsure about any aspect of setting up an LPA, you should seek professional advice 

Legal advice from a solicitor, in advance, might be advisable. Over50Choices has an association with Lifetime Legal who will be able to offer you further information and advice on setting up a lasting power of attorney if required.


Ashley Shepherd is an Over 50s Personal Finance Expert

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