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When a person makes a power of attorney, they are appointing someone else to act for them with regards to certain matters. The person making the power of attorney is called the donor, and the person they appoint is called the attorney. A power of attorney gives the attorney the legal authority to act on the donor’s behalf with third parties such as the local council or banks. Certain types of power of attorney also authorise the attorney to act on decisions such as where the donor should live and whether they should see a doctor. In order to make any type of power of attorney, the donor must be able to make decisions for themselves. This is called having mental capacity.
WHEN DOES SOMEONE LACK MENTAL CAPACITY?
It is important to understand whether a person has the mental capacity to make decisions for themselves. This could impact how you can deal with that person’s affairs, such as whether it is still possible to create a lasting power of attorney or not.
It is also important to know at what point a person has lost their mental capacity so that a personal welfare lasting power of attorney or enduring power of attorney can be registered.
If a person can make a decision for themselves, they are said to have the mental capacity to make that decision. If that person is unable to make that decision due to some kind of mental disability, they can be said to lack mental capacity. The disability causing this may be permanent or temporary and could be caused by:
- Mental health problems
- Dementia
- Brain injury
- Alcohol or drug dependency
- Side effects of certain medical treatments
- Other illnesses or disabilities
Some general guidelines exist to help work know whether a person has mental capacity.
A person is unable to make a decision if they cannot:
- Understand the information necessary to help make an informed decision, even when information is given in a way that meets their needs for example, in sign language or simple terms, or
- Remember that information, or
- Use the information to help then to make a decision, or
- Communicate their decision in any way
A person may lack the capacity to make all decisions, or they may only have the capacity to make certain decisions but not others.
ORDINARY POWER OF ATTORNEY
If you would like someone to take care of your financial affairs for a longer period of time, a person can be granted ordinary power of attorney under certain circumstances. These include:
- Physical illnesses
- After an accident that lead to physical injury
- If you are abroad for an extended period
Certain circumstances where you should not use ordinary power of attorney include:
- You have been diagnosed with a mental health condition or a disease which could lead to mental incapacity
- You think you may be at risk of developing a mental health condition or a disease which could lead to mental incapacity
This is because you will not be able to continue using the ordinary power of attorney if you do lose your mental capacity.
In these situations it is often more appropriate to make a lasting power of attorney instead.
How to grant ordinary power of attorney
JMR Solicitors can help you to make you ordinary power of attorney, whether you wish to grant a person power to handle all of your financial affairs or only certain powers such as opening a bank account. It is vital that the attorney is clear about what they can and cannot do, so you should seek professional legal advice from the outset.
ENDURING POWER OF ATTORNEY
What is enduring power of attorney?
An enduring power of attorney could be used to manage the affairs of someone who has lost their mental capacity, or someone who you think may lose their mental capacity.
It is no longer possible to create a new enduring power of attorney, but if an enduring power of attorney was created before 1st October 2007 it can still be registered, and if it has already been registered will still be valid.
If you would like to manage the affairs of somebody who you think may lose their mental capacity and you do not already have an enduring power of attorney, you should use a lasting power of attorney.
If you already have an enduring power of attorney it cannot be used to manage the personal welfare of a person, but can still be sued to manage their finances and property.
Registering an enduring power of attorney
To use an enduring power of attorney after somebody has lost their mental capacity, it must be registered with the Office of the Public Guardian. It must be registered by the person who will be managing the affairs of the person in question, and certain people must be notified that you intend to register the enduring power of attorney.
The people who must be notified are:
- The person whose affairs you intend to manage
- Any other attorneys
- At least three of the person’s nearest relatives
Once this is done, you may apply to register the enduring power of attorney. JMR Solicitors can help you to do this.
Ending enduring power of attorney
There are a few ways to end an enduring power of attorney, including:
- If the person still has mental capacity, they can cancel it
- An attorney may say that they no longer wish to be an attorney
- A court order
- The Court of Protection can end an enduring power of attorney if they think that the attorney has abused their position, or if they think that the person made the enduring power of attorney under duress or because of fraud
Can an enduring power of attorney be changed to a lasting power of attorney?
If an enduring power of attorney exists but has not been registered, it can simply be destroyed. You can then make an application to a lasting power of attorney which can then be registered. Unlike an enduring power of attorney, a lasting power of attorney must be registered before it is valid.
Alternatively, the enduring power of attorney can be kept and a separate lasting power of attorney can be made to deal with any personal welfare issues.
LASTING POWER OF ATTORNEY
If you wish for someone to take care of your affairs for a longer period of time than that covered by an ordinary power of attorney, a lasting power of attorney can be applied for.
A lasting power of attorney covers your personal welfare and an additional one can cover your financial and property affairs. Unlike the old enduring power of attorney, a lasting power of attorney must be registered before it is valid.
Lasting power of attorney is intended to be used by people who are at risk of losing their mental capacity and as such, may become incapable of making important decisions.
When should a lasting power of attorney be made?
You should consider making a lasting power of attorney is you have been diagnosed with, or think that you are at risk from developing certain illnesses which may impair your judgement or prevent you from making important decisions in the future.
These illnesses include:
- Mental health problems
- Dementia
- Brain injury
- Alcohol or drug dependency
- Side effects of certain medical treatments
- Other illnesses or disabilities
You must make a lasting power of attorney whilst you are still capable of making decisions for yourself, as it is an important decision in itself and requires your full mental capacity.
Different types of lasting power of attorney
There are two types of lasting power of attorney:
- Property and financial
- Personal welfare
Depending on your individual needs, you can make just one of the above or both. You do not have to make them both at the same time, and they do not have to appoint the same people to deal with every matter.
It is possible to make a lasting power of attorney to give a person authority to deal with certain types of matters. It is especially important to have expert legal assistance when drawing up this type of power of attorney, so that the attorney is clear about exactly what they will be authorised to do, and not do.
Property and financial affairs attorney
A property and financial affairs attorney will be able to make decisions about things such as:
- Buying or selling property
- Welfare benefits and tax credits
- Bank, building society and other financial accounts
- Tax affairs
- Legal proceedings
- Debts
Someone with a property and financial lasting power of attorney may be authorised to deal with all of the above, or only those that you choose.
This type of power of attorney must be registered before it becomes valid, however it can be used before a person loses their mental capacity.
Personal welfare attorney
A personal welfare attorney will be able to make decisions about things such as:
- Living arrangements
- Day to day care including what you will eat and wear
- Healthcare
- Contact arrangements with other people
- Access to personal information
As with property and financial attorneys, this type of attorney can be appointed to deal with all of the above or only certain things.
A personal welfare power of attorney can only be used once the person has lost their mental capacity. It must also be registered before it is valid.
How to make a lasting power of attorney
A lasting power of attorney must be made while the person is still able to make decisions for themselves. To make a lasting power of attorney, the correct form must be completed and registered with the Office of the Public Guardian.
There are different forms for property and financial attorneys and for personal welfare attorneys and it is vital that the correct form is completed, and completed correctly.
If you would like a property and financial attorney as well as a personal welfare attorney, both forms will need to be completed. You do not need to complete these forms at the same time, but they must be completed while you are still able to make decisions for yourself.
If you have completed a form but do not wish to register the power of attorney yet, you can wait until a time that suits you. Furthermore, the person named as your attorney can still register the power of attorney at any time even after you have lost your mental capacity.
When you have made a lasting power of attorney you can request that certain people are notified when it is registered. This can help to protect you against fraud or making a power of attorney under pressure.
How to end a lasting power of attorney
There are a few ways to end a lasting power of attorney, including:
- The person who made the lasting power of attorney can cancel it, if they still have the mental capacity to make this decision
- The attorney can chose to no longer act as an attorney
- If the person who made the lasting power of attorney dies, it will come to an end.
- If either the person who made the lasting power of attorney, or the attorney themselves become bankrupt
WHAT HAPPENS IF THERE IS NO POWER OF ATTORNEY?
If someone has lost their mental capacity and there is no power of attorney in place, or if a power of attorney has been ended, there are a number of ways to make sure that the right person makes important decisions on their behalf.
It is not possible to make a new power of attorney once a person has lost their mental capacity. However, it is possible to apply to the Court of Protection for decisions on certain matters. This may not be appropriate in some cases, or if there will be numerous decisions and a continuing need. The Court of protection can appoint someone as a deputy in these situations, which will usually be a family member or someone who knows the person well. A deputy will have the authority to make decisions about a person’s financial and property affairs as well as their personal welfare.
Support and supervision of deputies is provided by the Office of the Public Guardian and a deputy will have to show that they are the best person to be acting as a deputy. The Court of Protection can cancel the appointment of a deputy if they feel that they are not acting in the best interests of the person concerned.
If no suitable person can be appointed as a deputy, the Court of Protection can appoint a professional to make these decisions.
For urgent decisions to protect a person’s health or safety, emergency orders can be applied for with the Court of Protection in as little as 24 hours. Interim orders can also be made if, for example, urgent action is needed to pay for a person’s care home fees.
What happens when someone is not acting in the best interests of someone who has lost their mental capacity?
If you have concerns about the actions that an attorney or deputy is making and think that they are not acting in the best interests of someone who has lost their mental capacity you should report your concerns immediately to the Office of the Public Guardian.
If there is a lasting or enduring power of attorney that has not been registered, you can object to its registration.
The Office of the Public Guardian can arrange for a court official to investigate your concerns and in serious cases, the Court of Protection may cancel a lasting or enduring power of attorney.