What you should know about power of attorney

There may come a time when you are unable to independently manage your affairs. It can be difficult to trust these responsibilities to someone else, so understanding what a Power of Attorney is, and how an application can be of benefit is critical.

Elvira Norton, Legal Adviser at DAS Law explains and explores the abilities and limitations of the Power of Attorney.

What is a Power of Attorney?

A Power of Attorney gives someone the legal authority to act and make decisions on your behalf in areas such as finance and property and/or health and welfare.

A Lasting Power of Attorney (LPA) is commonly used when a person may no longer have the capacity to make their own decisions, and thus entrusts someone else to do this for them. A LPA is commonly given to family members due to the fact that oftentimes they will act in your best interests.

However, you can also give an LPA to a friend or a legal representative. The choice is yours as to who you think will be the best placed to act in your best interests. You can also have more than one LPA granted. For example, your daughter could take charge of your finances whilst your son could be in charge of your healthcare. Or they could be appointed as jointly and severally liable, meaning they can make decisions on their own but are both responsible.

What does the Power of Attorney application process entail?

1. The first step in the application process is to first choose who you are wishing to appoint. Once this decision is made you can then fill out the appropriate forms. You can either do this online through the gov.uk website or by downloading and printing off the forms. The LP1F is for financial decisions and the LP1H is for healthcare. These forms need to be signed by yourself, the attorneys, witnesses, and a certificate provider who ensures you are making the LPA by choice and understand what you are doing. The Attorneys can witness each other sign but they cannot witness you signing. They also cannot be a certificate provider.
2. You must then notify relevant people of this by using form LP3. If you use the online service, it will create and fill these in for you. The relevant people are those of your choosing: whoever you think should be notified in regard to the LPA.
3. The last step is to register this with the Office of the Public Guardian (OPG) by sending the filled and signed forms with the appropriate fee (£82 per application) to the address provided on the forms. If there are no mistakes in the application, then this would normally take around 20 weeks. Either you or your attorneys can do the registration. Your attorneys cannot make decisions for you until you register.

How long does a Power of Attorney last?

An LPA will only end in certain circumstances. For example:

• when the donor passes away;
• the legal document is ended voluntarily; or
• because the attorney is no longer capable of acting for the donor.

Can a Power of Attorney be contested?

The relevant people notified by you can challenge the LPA on either factual or prescribed grounds.

A factual objection would be, for example, if the donor or attorney have died, or if the donor and attorney were spouses who are now divorced. The person making a factual objection must do so within 3 weeks of receiving the notification.

An objection on prescribed grounds can be made after the granting of an LPA. These objections can arise in situations such as fraud, the attorney not acting in the best interest of the donor, or the donor was pressured into granting the LPA.

Of course, as in any legal situation, evidence needs to be provided to support the objection.

Another way to object is if the donor themselves then finds the attorney unsuitable. In this situation the donor would need to do a deed of revocation or a partial deed of revocation (depending on how many attorneys were appointed and are being removed) and send it to the OPG. The wording of this can be found on the gov.uk website. The donor needs to still be of sound mind and capability to do so.

Can a person report abuse or misuse of Power of Attorney?

If an attorney is not acting in the best interests of the donor, then this can be reported to the OPG. The OPG may then investigate the matter by directing an official of the court to visit the attorney. The OPG may then remove the LPA if they have sufficient evidence of the issues raised. In serious cases, the Court of Protection (CoP) can cancel the LPA and/or take action against the attorney.

How much control does the Power of Attorney have?

The attorney can deal with a broad range of matters. If you wanted to limit the areas in which they can make the decisions, then it would be advised you draft the LPA document carefully to reduce the scope of decisions they can make on your behalf. It would be recommended to get a solicitor to do this for you to ensure there is no uncertainty.

However, there are some restrictions in law to be aware of. For example, financial attorneys cannot:

• Make large financial gifts;
• Manage discretionary funds;
• Pay themselves a fee (unless authorised by the document);
• Mix your finances with theirs;
• Make themselves benefit in any way from the LPA;
• Purchase something from the donor below market rate unless authorised by the CoP; or
• Tax plan without the CoP’s authority.

And health and welfare attorneys cannot:

• Restrict the donor’s freedom;
• Make decisions when the donor still has capacity; or
• Make assumptions based on age, behaviour, condition, or appearance.

Can a person refuse to be given Power of Attorney?

Yes. You can also fill out form LPA 005 if you no longer wish to be an attorney and send this to the donor, other attorneys and the OPG.

What is the process of determining if a person requires a Power of Attorney?

There is no process. It is recommended that these things are thought about early on, especially if the donor has some kind of illness which will at some point affect their mental capacity.

What happens if a person loses capacity and there is no Power of Attorney in place?

In this situation, someone who wishes to act on your behalf can apply to the CoP to be appointed as your ‘deputy’. The CoP will decide if they are suitable for the role. This process however is costly and time consuming – so it is advised that an LPA is granted sooner rather than later.