At a time when we are growing to a greater age than ever before, the benefit of having Lasting Powers of Attorney (LPA) is increasingly important, not just because of the greater numbers living with dementia but because they also make day to day living easier for those living with physical infirmities such as a stroke or MS or any other physically limiting conditions. But what would I be able to do if I haven’t put LPAs in place and find myself with an early diagnosis of dementia or MS and know that I will have to rely on others at some stage to act for me?
The most cost effective and quickest way of putting my affairs in order would be to organise Lasting Powers of Attorney which I can organise as long as I still have capacity to make decisions for myself.
There are two types of LPA: one which allows my attorneys (the people I have chosen to handle my affairs for me) to legally take control of my finances and property; and another which deals with my health and welfare needs.
As the person making the LPAs, I’m referred to as the donor. I would be inclined to name at least two attorneys to make decisions for me – in case one died or lost capacity. My spouse/civil partner would be an ideal attorney, as it is usually the spouse/civil partner who would take responsibility for my affairs if I couldn’t do so for myself. If I had children, I could also nominate them or my extended family members or even friends to act for me if I trusted them implicitly to do the best for me.
I had a client who had a son living in Australia and a daughter living in Canada and she was uncertain whether her children could act for her. I told her it didn’t preclude them from acting as Attorneys but on a practical point, I advised her to appoint another relative living in the UK, someone who was readily available to act for her if she needed. On a day to day basis the nephew was able to deal with his aunt’s day to day needs but, with modern technology, her children were still able to contribute to decisions made.
If I’m diagnosed with dementia or am left in a coma following a serious road traffic accident and haven’t already organised Powers of Attorney, life can unfortunately become very distressing for my loved ones. Without such authority they can’t legally access my bank accounts (maybe to pay care home fees), they can’t sell my house and they can’t encash shares etc. If I don’t have capacity they would have to apply to the Court for a Deputyship Order, and although a successful application can give my family members similar authority to LPAs, the application process is drawn out and Deputies have onerous responsibilities once the Deputyship Order has been issued.
I know of a lady who approached a colleague a few years ago to obtain a Deputyship Order for her mother. She had long been diagnosed with dementia and needed access to her mother’s finances. The application was lengthy and just as the Order was issued – 6 months after the application – mum died. Dad was then diagnosed and unsurprisingly, no LPAs had been put in place for him. She was back to square one.
To apply for a single Deputyship Order applicants must pay a number of Court fees, the initial being for £385. An individual’s application for two LPAs costs £164. Applying for a Deputyship Order would take my representatives many months and the Court will only grant the Order if satisfied firstly, that I needed a Deputy, and secondly, my Deputy would be suitable.
Once satisfied that an Order is required, the Court will ask my Deputy to pay a supervision fee and to effect insurance in the form of a bond, to protect against the risk that my Deputy might run off with my money, leaving me with nothing.
As well as financial responsibilities my Deputies would also have to deal with administrative dutoes –to submit annual accounts with documentary evidence of spending.
Generally, I advise clients to make Powers of Attorney where they can because I know how much more straight forward it is to apply for a Power of Attorney than to apply for a Deputyship Order. Both achieve the same end result – but the processes involved are so very different and the cost and ongoing responsibilities varies.
At the end of the day once my Powers of Attorney are in place, I can relax knowing that if needed my chosen representatives will be able to deal with my personal affairs at what is otherwise likely to be a very difficult time for them.
If you would like to arrange an appointment to discuss anything regarding Wills & Estate Planning please contact our team on 01256 320555 or email mail@clarkeandson.co.uk.
Ian Beavon
Wills & Estate Planning Legal Executive
