Posted by Tony Millson, Partner
On 1 September 2016 Withy King LLP merged with Royds LLP. The trading name for the merged firm is Royds Withy King. All content produced prior to this date will remain in the name of the firms pre-merger.
Creating a power of attorney – always a smart move
Death and taxes have always been part of life and people make wills, not just to ensure their estates are divided as they would wish but, increasingly, to try and negate some of the effects of inheritance tax. Due to expanding property values and, to some extent to popular savings schemes like ISAs, those who may never have considered themselves wealthy now face the prospect of their estates becoming subject to the tax.
While dementia is not a certainty many people are affected by the condition and the number of people this is expected to double over the next two decades. One in three people over the age of 85 are likely to be affected; rising to one in two for those over 90 years old. While this, of course, means many others are unlikely to be affected it remains advisable to grant power of attorney – the process by which you nominate someone to look after your financial and health care issues should you become incapable, mentally or physically, to do so.
Recent research into Alzheimer’s disease led by scientists at King’s College, London, with UK company Proteome Sciences, has led to a test that can predict the onset of Alzheimer’s in the next 12 months in people with memory loss with an accuracy of 87 per cent.
Power of attorney can be seen as a form of insurance to make certain that the affairs of an individual will continue to be looked after should dementia take root at a later stage.
Now, should a test for future dementia with a near-90 per cent degree of accuracy become licensed, and roughly one in three of those tested prove positive, it may follow that a sharp rise in interest in granting power of attorney will follow.
To grant a power of attorney, the “granter” authorises another person (or persons) to help them out and take responsibility for their welfare and financial affairs in the event of mental or physical incapacity taking hold. This appointment can take effect immediately or at a later stage that the granter decides when authorising the power of attorney.
As part of the process a lawyer should interview the granter in person and correspond with his/her potential attorney/attorneys (who are often close relatives or professional advisers). In signing off a power of attorney a lawyer needs to be satisfied not only that the granter understands the nature and extent of the power of attorney but also that there is no pressure on them from the proposed attorneys. If there is any concern regarding a granter’s capacity then it is usual to secure a doctor’s certificate.
When someone who has not granted power of attorney becomes unable to manage his/her financial affairs, a “guardian” has to be appointed through the court. This process can be very complicated and drawn out, often involving many legal technicalities and accounting difficulties. In these cases, the cost can be significantly more than the fee that would have been charged for granting power of attorney.
Although normally associated with the older generation, granting power of attorney is advisable for every adult. The solution is to have power of attorney put in place before it is too late.
Our experts at Royds are experienced in helping individuals to put in place power of attorney’s to help safeguard their future wishes. We are also available to act as an attorney or advise and guide your attorneys on the management of affairs. For more information, please visit or contact Tony Millson or Deanna Hurst.