10 common misconceptions of Lasting Powers of Attorney
18 February 2021 by Carlie Brown
If you became unable to make your own Financial and Health decisions then the best way to protect yourself and your wishes is to put in place a Lasting Power of Attorney or LPA.
Quite often people fail to make an LPA because they are unsure about what it involves and why it is needed.
Here are 10 common misconceptions about LPA’s:
1. I have a Will in place so I do not need an LPA
A Will and Lasting Power of Attorney are two separate documents and do not operate at the same time.
A Will comes into effect on your death and your named Executors deal with the administration of your Estate and the application for a Grant of Probate.
A Lasting Power of Attorney operates during your lifetime and appoints Attorney(s) who manage your Property and Financial affairs and Health and Welfare decisions. The authority of your Attorney(s) under the Lasting Power of Attorney ceases upon your death.
2. Attorneys once nominated can do whatever they like
You can set the restrictions as to when and how your Attorney(s) should act and what they can and cannot do in relation to your property. You can also limit the powers an Attorney is given, and include specific guidance on how you would like them to deal with certain matters.
The Office of the Public Guardian have restrictions and clear rules on how an Attorney must act preventing them from acting outside of their power.
3. The LPA must be used once it is made
Once registered an LPA can be kept in a safe place until such time as it is needed. It does not need to be used straight away if it is not necessary.
Anything can happen in life, for example, an unexpected hospital admittance or an accident which causes you to lose capacity. Having an LPA registered means that if an unexpected emergency occurs then your Attorney(s) can step in at this time to help you manage your affairs under their authority as Attorney(s).
4. You can only have one Attorney
You can appoint one Attorney or up to four. It is possible to appoint more than four but it is not recommended. If you have a lot of Attorneys, they might find it difficult to make a decision together.
When more than one Attorney, you can choose whether they should act jointly and severally, jointly or jointly in some decisions and jointly and severally in others.
You also have the option in the LPA forms to include Replacement Attorneys, should your first named Attorney(s) be unable to act for any reason your replacement will step in.
You should appoint people you trust and know well.
5. LPA’s are for the elderly
LPA’s are as important for young families as they are for the elderly. People lose mental capacity for many different reasons including accidents, strokes, being unconscious or in a coma, and also dementia.
Don’t leave making an LPA until the moment it is needed as that could be too late.
6. Jointly held assets are not affected by mental capacity
It is normal for banks to freeze all withdrawals from joint accounts when they are aware that one of the joint account holders has lost mental capacity. This means that a spouse will lose access to the account unless they have proof of authority by way of Lasting Power of Attorney to act on your behalf.
Your spouse may not be able to meet their needs during this period or pay for your expenses until an LPA is in place.
7. My next of kin can make Health decisions without an LPA
The title of next of kin does not give any legal authority to make health or medical decisions for an incapacitated adult.
A person appointed as your Health and Welfare Attorney can liaise with Doctors and medical professionals about you and make decisions about your medical treatment, where you live, and the support and help you should receive.
Without a Health and Welfare LPA, medical professionals are bound by law to make decisions they believe are in your best interests, which may not be the same as what your family believe.
8. I can set up an LPA when I need to
A Lasting Power of Attorney can only be made whilst you have mental capacity. If you were to lose mental capacity, a Court of Protection application to appoint a Deputy would need to be applied for. This is a lengthy Court process which takes months to obtain and costs a lot more than making LPA.
9. My family will look after me so I don’t need an LPA
Nobody has the legal authority to manage your affairs without a Lasting Power of Attorney.
By leaving decisions up to your family without a Lasting Power of Attorney in place it can be stressful for them as they might not know your wishes. It can cause family fallouts as not everyone could be in agreement.
An LPA reduces the likelihood of disagreements between family members at a stressful time. It also gives them the confidence that they are acting in your best interests and in accordance with your wishes.
10. I already have an Enduring Power of Attorney in place – I do not need an LPA
In 2007 Enduring Powers of Attorney (EPA) were replaced by Lasting Powers of Attorney (LPA). EPAs signed before then, remain valid, but LPAs carry a lot more benefits.
One of the main differences is that an EPA does not allow your Attorney to make decisions about your Health and Welfare and only covers your Property and Financial decisions.
An EPA does not allow for the appointment of Replacement Attorneys so if your first named attorney is unable to act or pre-deceases you, the EPA will be of no use. At this point an LPA could be set up but only if you have mental capacity to do so.