Shocking stories of a Midlands estate agent and even a churchman conning elderly people out of their life savings have sadly hit the headlines in recent months. Here Helen Bradin, solicitor at local Bradin Trubshaw & Kirwan LLP, explains why everyone needs to consider appointing a Power of Attorney to safeguard their finances and protect themselves from those who prey on the vulnerable.
Q: My husband and I have both made wills but it has been suggested that we should also grant a Power of Attorney. Why do we need to do this as well?
Helen: It’s great that you have made your wills as so many people put off signing one of the most important documents of their lives. Whilst a will makes sure that your money and possessions are distributed in accordance with your wishes when you die, it does not cover what happens if you become mentally incapacitated – because of illness or an accident – and unable to make decisions. Power of Attorney allows you to specify who you wish to look after your affairs in the event that you cannot do so for yourself.
Q: I’ve heard that there is more than one type of Power of Attorney, so which is best?
Helen: There are two categories of Power of Attorney: Ordinary, and Lasting which is the most usual form. Lasting Power of Attorney (LPA) must be drawn up whilst the person, known as the ‘donor’, still has the mental capacity to authorise who may make decisions on their behalf if they lose the ability to do so for themselves. In addition, there are two kinds of LPA – you can make one or both types. The Health and Welfare LPA allows decisions to be made about, for example, your medical care, moving into a care home and accepting/refusing life-sustaining treatment, whereas the Property and Financial Affairs LPA covers decisions about money and property. An Ordinary Power of Attorney is a legal document which allows someone to act on your behalf concerning your finances whilst you still have the mental capacity to monitor what they are doing – for example if you had to go into hospital.
Q: If I have an accident and am left in a coma, can my wife access my personal bank account without a Lasting Power of Attorney?
Helen: Your wife would not automatically be able to access your finances and would have to go through the Court of Protection which would control your assets. The idea behind this court is to safeguard the assets of vulnerable people. That’s why it is so important to grant someone you trust Lasting Power of Attorney to avoid problems in the future. The Court of Protection charges to deal with your affairs and the process can be very long winded which can prevent them from making decisions that you may need answers for quickly. The charges that are made can reduce the money you had available.
Q: I’ve heard the term Enduring Power of Attorney. Is that the same as Lasting Power of Attorney?
Helen: LPAs replaced the Enduring Power of Attorney when the Mental Capacity Act of 2005 came into effect on 1st October 2007. Whilst you can no longer make an Enduring Power of Attorney, it is valid if drawn up prior to 2007.
Q: Who can be my Attorney?
Helen: You can appoint anyone you trust to be your Power of Attorney as long as they are over 18, able to make decisions and not bankrupt. Usually this means a husband/wife/partner; relative; friend or solicitor. Before you choose someone you should think about whether you trust the person(s) to make decisions in your best interests; whether they would be comfortable taking decisions for you (e.g. about your medical care) and how well they manage their own finances. You can specify people who you would like to be notified before you grant Lasting Power of Attorney if you wish.
For advice on family and other legal matters contact Bradin Trubshaw & Kirwan on 01543 421840 for a consultation or email email@example.com