What’s new in an LPA?
A new legal regime came into effect on 1 October which is intended to give greater protection to elderly people than the enduring power of attorney (EPA) that it replaces. Like an EPA, a lasting power of attorney (LPA) allows a person – the donor – to appoint a relative, friend or anyone else they trust to manage their affairs should they become incapable of doing so themselves. But there are many differences between the old and new systems.
LPAs come in two forms. The first, which is entirely new, covers decisions about health, welfare and housing. The second deals with property and money, and is similar to an EPA. The donor can appoint one or more different attorneys for these purposes, and can also specify any restrictions or requirements.
Another new feature is that an LPA is only valid once it is registered with the Public Guardianship Office. Registration will require a signed certificate from a reputable person. This confirms that the donor understood the purpose and scope of the LPA and that there was no fraud or pressure on the donor, who must therefore be mentally capable when making an LPA.
In addition, the donor must nominate at least one person, other than the provider of the certificate, whom the Public Guardianship Office will notify when the LPA is registered, or a second certificate must be provided, which should be signed by a different reputable person. The need for two people to be involved, apart from the attorney, is intended as an added safeguard for the donor.
Once it has been registered, an LPA starts to operate when the donor loses mental capacity. However, a donor can also grant an LPA over their financial affairs (but not their personal welfare) that takes effect while the donor still has capacity.
Clearly the right choice of attorney is important and it is often best to appoint joint attorneys. Although any attorney must by law act in the interests of the donor, not everyone is equally up to the task. The ideal time to prepare LPAs is in conjunction with writing or reviewing your will. And they are not just for older people – even a young person might suffer a serious injury.
The new LPA regime covers England and Wales. Similar powers have existed in Scotland since 2 April 2001 in the form of the continuing power of attorney and the welfare power of attorney. Northern Ireland retains the EPA regime.