What is a Power of Attorney?
A Power of Attorney is a document by which one person (“the donor”) gives another person (“the Attorney”) the power to act on his behalf and in his name.
What’s it for?
It may be completely general, entitling the Attorney to do almost everything the donor could himself do, or it may be limited to certain defined purposes. For example, a donor might appoint an Attorney to deal with the purchase of a house if he knows that he will be abroad when the papers have to be signed.
Anything else?
We would advise every person approaching old age, as a matter of common prudence, to sign a Lasting Power of Attorney even if it is not to be used in the near future. It can be filed away against the date when it might be appropriate to use it.
It is an inexpensive way of ensuring that your financial affairs will be in safe hands if you become mentally incapable. The alternative is the expense of an application to the Court of Protection followed by the cost of administering a Receivership.
So it still works even if I get really ill?
Until a few years ago the rule was that any Power of Attorney was automatically revoked if the donor became mentally incapable. This caused difficulties for two reasons. First, it could sometimes be difficult to decide whether a donor had become incapable, particularly where the donor’s health was deteriorating gradually with the onset of old age.
Second, there was no way in which a person could privately arrange in advance to give someone authority to handle his affairs if at a later date he should become incapable.
Lasting Powers of Attorney have now been introduced. These are a special type of Power of Attorney which continue to give authority to the Attorney even if the donor becomes mentally incapable.
What will my Attorney be allowed to do?
An Attorney appointed under the terms of an Enduring Power of Attorney may be given general power in relation to all of your property and affairs, or you may wish to include restrictions.
If you don’t want the Attorney to be able to act on your behalf until there is reason to believe that you are becoming mentally incapable, that restriction may be included in the terms of the document. You can also place restrictions on what the Attorney may do.
Do I have to choose just one person?
It is possible to appoint more than one Attorney. If so, you must decide whether the Attorneys should act jointly, or whether they may act jointly and severally – that is that they could act together but can also act separately if they wish.
Since an Attorney appointed under the terms of an Lasting Power of Attorney can have such wide powers, it is most important that the Attorney should be carefully chosen and should be somebody you trust completely.
You may wish to appoint a member or members of your family. For example, you could appoint your spouse and one or more of your children to act jointly and severally. Or you may decide to appoint one family member and a professional Attorney, such as a Solicitor.
How do you get one done?
A Lasting Power of Attorney must be granted in a prescribed form. This form makes it clear that the power will continue to be effective even if you become mentally incapable.
The form must be signed both by both you and your chosen Attorney. By signing the form, the Attorney accepts the appointment and also acknowledges that he will have a duty to register the Lasting Power with the Public Guardianship office (“PGO”) if you become mentally incapable.
Once the PGO has registered the Lasting Power (and this is a relatively simple process) the Attorney can continue to act on your behalf under its terms.
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