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As our loved ones get older, conversations often turn to future care, finances, and healthcare decisions. One legal document that frequently comes up is a Lasting Power of Attorney (LPA). Although many people have heard the term, they’re often unsure what it means, when it’s needed, or how it works.
What Is a Lasting Power of Attorney?
A Lasting Power of Attorney (LPA) is a legal document that authorizes someone that the donor (the person creating the LPA) trusts to act on their behalf. This means that they will legally make decisions for them. An attorney will not gain ownership of money or belongings or be able to make unrestricted decisions.
An LPA is only necessary if someone loses mental capacity and cannot make decisions for themselves. It does not remove independence, but assists where independence is no longer an option.
The Two Types of Lasting Power of Attorney
There are two distinct types of LPA for different situations.
Property and Financial Affairs LPA
This LPA will allow an attorney to manage the finances of the donor, including:
- Manage bank accounts.
- Pay bills.
- Manage pensions.
- Sell property.
- Manage investments.
- Manage benefits.
This LPA can be used before the donor loses mental capacity, with permission.
Health and Welfare LPA
A health and welfare LPA will only come into effect once the donor no longer has mental capacity to make their own decisions. This LPA will include management of:
- Medical treatment.
- Any care home-related decisions.
- Daily routines.
- Personal care.
- Life-sustaining treatment.
What Is Mental Capacity?
Mental capacity relates to a person’s ability to understand and retain information. It will impact the ability to weigh up options as well as communication.
Mental capacity can greatly decrease as we age. Conditions such as dementia have a huge effect on mental decline and communication abilities. A lack of mental capacity may also be caused by:
- A severe learning disability.
- A brain injury.
- A stroke.
- A mental health condition.
- If they are unconscious.
The Mental Capacity Act (MCA) was established in 2005 to protect people aged 16 and above who cannot make decisions for themselves. It ensures that someone must be assisted to make their own decisions until they completely lose capacity. Any unwise choices that they have previously made must not affect their rights to decide, and all decisions made for them must be in their best interest.
How Is Mental Capacity Assessed?
The MCA outlines a two-stage assessment to establish mental capacity.
Firstly, does the person have an impairment that makes them unable to make a decision when required? Consider that capacity can fluctuate with time and can also change from decision to decision. For example, someone may lack the capacity at a certain time but may be able to make the same decision at a later time.
Secondly, does the person have an impairment of their mind or brain? This could be the result of an illness, a condition, or substance use.
The MCA classes a person as unable to decide if they cannot do one or more of the following:
- Understand the information relevant to the decision.
- Retain the information for long enough to make a decision.
- Use or weigh up that information as part of the process of making the decision.
- Communicate their decision in any way.
When Is a Lasting Power of Attorney Needed?
The best time to get an LPA is before it is actually needed. If someone is facing a diagnosis of dementia, Parkinson’s disease, or other neurological conditions, creating an LPA early will help you to plan for the future with the donor’s wishes. You may want to plan for older age and serious illnesses that usually affect older people.
Waiting too long to create an LPA can cause issues. Doing it early can allow you to retain as much of the donor’s wishes as possible.
What Happens If There Isn’t a Lasting Power of Attorney?
If someone cannot make decisions for themselves, this does not mean that family members can automatically make decisions for them in the absence of an LPA. If mental capacity is lost, then a family member will need to apply to the Court of Protection for a deputyship.
A deputy acts much in the same way as an attorney. However, as they were not appointed by the donor themselves, there is a much longer process involving a complex court application, legal or court fees, and ongoing yearly supervision costs. A deputy will face strict supervision and must send annual reports to the Office of the Public Guardian.
How To Choose an Attorney?
When choosing an attorney, you must understand what exactly they will have control of. You must ensure that they are trustworthy and will be able to make these difficult decisions for you. They should know you extremely well and understand your wishes so that they can filter this into the decision that they make. Being an attorney does entail managing a lot of separate finances and important accounts, so choosing someone who is very organised will be best.
An attorney can be anyone that you trust, not just a family member. It could also be a friend or even a professional. You can also appoint more than one attorney, which can help to lighten the load. If you would like to be extra secure, you can also appoint a replacement attorney in case your first choice is no longer able to assist you.
How Can a Lasting Power of Attorney Help With Moving Into Care?
A health and welfare attorney will be very helpful if you are moving into a care home. The donor should have already discussed their preferences for care services with the attorney and consented to being moved into a care home if necessary. The attorney should discuss care options, arrange for professional carers, and attend any assessment or reviews of the donor’s care plans.
A financial attorney is also important when care needs increase. They will arrange fee payments, whether for residential or home care. They will also organise your finances, including managing your pensions. If moving into permanent residential care, this attorney will also handle the sale or inheritance of the donor property if desired.
Having an attorney whilst living in care does not mean that the carers will not respect the donor’s wishes. The home will still involve the resident when possible.
How to Create a Lasting Power of Attorney?
To make a lasting power of attorney, you simply have to have the attorney, a witness, and a certificate provider to sign the required forms. Then register with the Office of the Public Guardian, which will cost £92. If you are registering both a personal welfare LPA and a financial LPA, you will be charged for both applications (therefore £184).
Although planning for the future can feel daunting, setting up a Lasting Power of Attorney is one of the most practical ways to ensure your wishes are respected if you’re ever unable to make decisions yourself. Whether you’re planning for later life or supporting an ageing relative, arranging an LPA early can provide reassurance for everyone involved.
