What is a Power of Attorney?
A Power of Attorney (POA) is a document by which you give permission to a third party to handle your affairs. There is more than one type of POA and it is important to understand the differences between them and ensure that if you decide to hand over the management of your affairs to someone else that the correct POA is in place.
Ordinary Power of Attorney
As with all POA’s this document allows you as mentioned previously to hand over the running of your affairs to someone else and for many people this works well. However, an ordinary POA ceases to be valid once the person for whom the POA has been set up to assist, loses mental capacity to manage their own affairs.
Lasting Power of Attorney
A Lasting Power of Attorney (LPA), unlike an ordinary POA remains valid should the person for whom it is set up to protect, lose their mental capacity to manage their own affairs. The LPA must be registered with the Office of the Public Guardian before it can be used.
There are 2 types of LPA
- Property and Affairs
This allows you to appoint someone to make decisions on your behalf about spending your money and managing your property and affairs.
- Personal Welfare
You can appoint someone to make decisions on your behalf about your welfare, such as where you live and who you live with. They can consent to medical treatment on you behalf and even take decisions about life sustaining treatment if you wish.
What type of ‘affairs’ can an LPA or ordinary POA cover?
POA’s and LPA’s can both cover the same type of property and financial affairs, the difference is in their validity in the face of mental incapacity. The affairs relate specifically to matters of finance and property, such as your home, savings, investments etc.
If I want someone to take care of all my affairs, will I need to make both a Lasting Power of Attorney for Property and Affairs and another for Personal Welfare?
Yes, the Mental Capacity Act 2005 means that two separate documents have to be prepared as the Personal Welfare power only comes into effect if you are mentally incapable of making decisions yourself. A Property and Affairs power comes into effect if you wish once it has been registered with the Office of the Public Guardian whether or not you are incapable.
You can now make an LPA for Personal Welfare which enables you to appoint someone to make decisions on your behalf concerning your health and welfare and life sustaining treatment. This is in addition to an LPA in relation to your finance and property.
Any old existing Enduring Power Attorney which was made before 1st October 2007 (and which LPA's for Property and Affairs effectively replaced) will remain valid unless you revoke it. It will not be necessary to replace it with an LPA for Property and Affairs, but it will not of course cover Personal Welfare matters for which a new LPA for Personal Welfare would be required.
Who can I appoint as my attorney?
The most important consideration when deciding who to appoint, is that you feel able to trust them completely. A Power of Attorney of any nature is extremely powerful and an LPA under which you relinquish control of all of your affairs once you lose the capacity to fully deal with them unaided is even more powerful.
Generally, an Attorney can be almost anyone you choose over the age of 18 with only a few exceptions e.g. bankrupts, someone holding Government Office etc. You can choose more than one attorney if you wish. We would be able to advise you further in this regard should you choose to contact us with a view to setting up a Power of Attorney.
What should I do next?
We are experienced in the preparation of all types of Powers of Attorney and would be pleased to act on your behalf in this or any other matter.
If you would like more information or you would like us to act on your behalf, please contact us on 0191 514 4323 (Sunderland) or 0191 511 8222 (Seaham).