At some point in your life you might need someone to help you make decisions about your health or finances, or to act on your behalf. This beginner’s guide to power of attorney will guide you through this very complex subject.
You may need to appoint someone because of a temporary situation, such as going into hospital. You may also need to appoint someone on a more permanent basis if, for example, you have been diagnosed with dementia.
To do this you will need to appoint a trusted person to have your Lasting Power of Attorney (LPA). Your family or friends are not able to simply take over all your most important health and finance affairs without an LPA. So appointing an attorney is incredibly important. In this case, you will be known as the ‘donor’ and the trusted person that you appoint under a Power of Attorney will be known as your ‘attorney’. You can also read our article “I have power of attorney, now what?“
You can lose capacity at any age
Crucially, you must appoint your attorney while you still have mental capacity. Contrary to popular belief, you can lose capacity at any age. If you haven’t appointed anyone before you lose mental capacity, then an application would have to be made to the Court of Protection. The court will then appoint a ‘Deputy’ to act on your behalf.
The information on this website is based on the law for England and Wales. In Scotland and Northern Ireland, the law has some differences. although we highlight these where we can, please be aware that POA rules are not consistent across the UK.
Types of Power of Attorney
There are three main types of Power of Attorney :
- Ordinary power of attorney
- Lasting power of attorney
- Enduring power of attorney
The Lasting Power of Attorney is the most common but, you can read the article on Types of Power of Attorney to decide which one you need.
Lasting Power of Attorney
A Lasting Power of Attorney (LPA) covers decisions about your financial affairs or your health and wellbeing. The LPA for Finance and Property comes into effect if you lose mental capacity or if you no longer want to make decisions for yourself. Whereas, the LPA for Health and Wellbeing only comes into effect when you have lost mental capacity. It wasn’t until 2007 that the LPA took over from the Enduring Power of attorney. Although, in certain circumstances, the EPA can still be valid.
There are two types of LPA:
For more information on the LPA, see General Guidance on Lasting Power of Attorney and Setting up an LPA? Start here. Also look at Your Power of Attorney for Business if you have any business affairs that need looking after.
Preferences and instructions
When filling out an LPA, the donor can make preferences and instructions. These need some careful consideration so, it’s worth reading the article on Questions for the Donor: What should they be asking? Also LPA Digital Service: Preferences and Instructions which explains what you need to consider. There is also some advice on Discretionary Investments and Power of Attorney.
One question that is frequently asked is in our article Brief encounter: Do you need a solicitor to help with Power of Attorney?
Another thing is the Top 10 mistakes in Power of Attorney applications. This is a very important list to look at when you are filling out the forms. It is reported that 15% of applications have mistakes in them. This can be a costly mistake because there is already a 20 week delay for processing the LPA at the OPG.
The attorney under an LPA may also consider whether it is permissible to give gifts using the donor’s money. This article the Rules of Gifting under a Lasting Power of Attorney is a good place to start.
Your Attorney
When choosing your Attorney, you may be thinking of the same person for both a Lasting Power of Attorney (LPA) for Health and Wellbeing and for Finance and Property. Or you can appoint more than one for both to act alone or joint and severally. Either way, you need to consider the decision wisely and take your time if you can. If the person is a lay person, i.e. someone who is not acting in a professional capacity, you need to make sure they are going to be comfortable doing the job for you. For further information on Choosing your Attorney read: Who do you trust? Choosing your Power of Attorney
Your family or friends are not able to simply take over all your most important health and finance affairs without a POA
There are five principles that an attorney must abide by – you can read more in How to act as an Attorney. The attorney may decide at some point that they do not want to be your attorney in this case they can disclaim the LPA.
Revoking the LPA
You may also need to consider Revoking your Attorney. You can end the Power of Attorney (POA) yourself by revoking your attorney as long as you have mental capacity. It may be that you no longer need the attorney or that the attorney is no longer suitable, practical or trustworthy.
The revocation will not be effective until it is received by the attorney or any third party. It is wise to keep an audit trail that the deed has been sent.
If you are revoking a Lasting Power of Attorney, you will also need to send the deed to the Office of the Public Guardian (OPG).
The position of attorney is an onerous one and not without its challenges. Although the OPG can investigate abuse by the attorney, who can the Attorney turn to in their hour of need? For more on this read: Who protects the attorney?
Mental Capacity
Your mental capacity is vital to whether you can make decisions or not. It will make the difference, for example, between whether you can even appoint your own attorney or not. If you are lacking mental capacity and haven’t appointed an attorney, it will be too late. In that case, a court called the Court of Protection would have to appoint an attorney instead, or a court-appointed Deputy, as it is known. For more understanding read: Grey matter matters: Lacking mental capacity.
Mental Capacity Assessment
At some point, the attorney may need to request a mental capacity assessment or it may be requested by an organisation. In some cases, the attorney may have to make an application to the Court of Protection for the court to determine the capacity of the donor.
Office of the Public Guardian
The Office of the Public Guardian (OPG) helps people in England and Wales to stay in control of decisions about their health and finance. In addition to making important decisions for others who cannot decide for themselves.
The OPG also oversees the duties of the attorney. If a family member or friend or other relevant third party suspects that the attorney may be abusing their position, then the OPG will investigate. Although, this is only if the donor has lost capacity. Read more here: Stopping the attorney abusing their powers.
Court of Protection
The Court of Protection for England and Wales can be at the Royal Courts of Justice in London or at a county court. It was created under the Mental Capacity Act 2005 and also has to consider the Human Rights Act 1998. For more see our General Guide for the Court of Protection
The Court can decide whether a person has the ability to make their own decision at the time it needs to be made. This is called mental capacity and, if someone cannot make their own decisions, they lack capacity. The Court can also make decisions for someone who lacks capacity. This is called making a best interests decision. The Court cannot make decisions on behalf of someone who has capacity.
Both matters of finance and welfare are dealt with by the Court of Protection (COP).
The Court can also appoint a Deputy if a person has already lost capacity. The Deputy may be family or a friend or a professional, such as a solicitor.
Using the LPA
There are various steps that the donor or attorney will need advice on so we have created some articles to help you:
