Retired court of protection judge, Denzil Lush, has said that he wouldn’t draw up a lasting power of attorney (LPA) and he would prefer to rely on a court appointed deputy to manage his affairs. Private client expert Eve Carter looks at making an effective LPA.
What is an LPA and can it be subject to abuse?
An LPA is a legal document drawn up when you have full mental capacity, appointing a person or persons to act as your attorney. This attorney will be responsible for your financial, health and welfare affairs if you become incapacitated.
Powers of attorney will often have access to the donor’s bank account and be able to manage the account and make payments on the donor’s behalf, this is where the risk of abuse can arise.
What if you don’t have an LPA?
Without an LPA, people will need to apply to the court of protection to be able to make decisions on your behalf. While the courts decide who should manage your affairs your accounts may be frozen, and it is likely that the person chosen as your attorney wouldn’t be a family member. This makes the process slow, costly and stressful for your relatives and carers.
What can be done to prevent abuse?
There were 2,478,758 registered lasting and enduring powers of attorney as of March 2017. During 2016/17 the Office of the Public Guardian received 5,327 safeguarding referrals, but only investigated 1,266 cases, of which only 272 resulted in an application to the Court of Protection.
While these statistics indicate that the incidence of abuse is low in comparison to the volume of LPAs, they do show that abuse is possible. Below are some ways of building safeguards into your LPA to reduce the chance of abuse:
- Choosing the right attorneys: it’s important to choose a good decision maker and not just someone who you trust. It’s best to choose attorneys who understand their role and are prepared to read and work within the code of practice. Family members are not always the best choice.
- Notification: you can choose named persons to be told about your LPA when it’s registered. This ensures they have an adequate opportunity to raise any concerns.
- Insert restrictions and conditions in the LPA: when drafting the LPA, it’s important to build in protection so there’s accountability and external supervision. For example, a condition in the LPA to have the accounts checked by a third party, such as an accountant, would provide accountability.
- Letters of wishes or guidance contained in the LPA: This could be included to set out a framework for the attorneys to act. An example would be including a specific provision naming the people the attorney should consult when making decisions.
- Joint and several appointments: joint and several appointments of attorneys is recommended. In practice, this allows for a main attorney to act, with the help of a less active one who can step in if needed. A supervisory clause could be included to expressly state that financial statements are to be shared with all attorneys.
- Consulting with the donor: Including a provision requiring the attorney to consult with the donor, co-attorneys and other named individuals, ensures that everyone is on notice as to how they should act.
In addition to the above, attorneys must abide by the code of practice, which provides guidance on the Mental Capacity Act 2005. The code makes it clear that attorneys must always act in the donor’s best interests.
What can I do now?
The best option is to make an LPA, ensuring that it is drafted accurately, and after seeking professional advice. Having a solicitor act as an impartial adviser with regards to potential attorneys can make sure that they are appropriate and that you are not under any pressure to appoint anyone in particular.
Objective and tailored advice from legal professionals when drafting an LPA will help you to include adequate safeguards and therefore minimise the chance of abuse.
If you require any further advice on the issues raised in the above blog then please contact Eve Carter in our Private Client Department on 01772 258 321 or Eve.Carter@harrison-drury.com