Posted by Edward Vidnes, Partner
Lasting Powers of Attorney: Is the power in safe hands?
Lasting Powers of Attorney (LPAs) have been in the press recently with headlines telling us that investigations by the Office of the Public Guardian* into actions of Attorneys are on the rise. Understanding an Attorney’s responsibilities, and an education of what they can and can’t do is often the important issue. We look at some of the ways you can make sure you are acting correctly as an Attorney.
*The Office of Public Guardian (OPG) is the Government body that oversees LPAs and their use.
An LPA is extremely useful and powerful document allowing you (the Donor) to appoint someone (an Attorney) to act on your behalf in relation to your financial affairs, or welfare decisions, if at a point in the future you are unable to do so.
What the increased investigations show is that although uptake of LPAs is on the rise, which is positive news, there are obviously issues with the way in which Attorneys are using them.
Sometimes the Attorneys’ action can be deliberately wrong and we have touched on abuse of LPAs and the importance of choosing the right Attorney in our previous blog. In other situations the reason behind the investigation may be as a result of misunderstanding or lack of knowledge about the Attorney’s role.
What is an Attorney allowed to do?
It is important for the Attorney to understand that they have a very responsible role and they must follow the Mental Capacity Act 2005 Principles and Code of Practice. Every decision made by them must justifiably be in the Donor’s best interests.
As an Attorney you cannot benefit from your position. Common problems arise when the Attorney takes funds from the Donor, even if this is under the belief that the Donor would have approved this if they had capacity.
You also can’t make gifts – again a regular issue – other than in certain limited circumstances.
Generally Attorneys will be able to make investment decisions on behalf of the Donor but the Donor must take care that appropriate wording to allow this is incorporated in their LPA as this is an area that often causes problems.
There are many other considerations that Attorneys should bear in mind when using the Donor’s money or assets (such as future care fees and contents of the Donor’s Will, if relevant). We would recommend that anyone who is appointed to be an Attorney spends time understanding their role before they act, and if in any doubt, consult a solicitor for detailed information on their role and responsibilities. They can then be confident they are acting legally and in their loved ones best interests at all times.
What these investigations demonstrate is the need for comprehensive advice and understanding of the completion and use of these extremely powerful documents, both for the Donor and the Attorney.
Safeguards and custom wording can be specifically incorporated into your LPA to make sure both the Donor’s wishes and the Attorney’s actions are correctly followed through. This is where the real benefit of sound legal advice from a specialist LPA solicitor can be found.
If you have any concerns about your duties as an Attorney or your LPA or Attorney contact partner Edward Vidnes in our Private Client team on:
0800 302 9068 Email us