William Cowan is an Abingdon solicitor based in the private client department at Slade Legal. He deals with wills, private clients, trusts and assisted advice. He came to our lunchtime meeting to talk to us about powers of attorney.
A power of attorney is a means by which you can appoint someone you trust to look after your affairs for you, if you become unable to do so in future. A lasting power of attorney (formerly an enduring power of attorney) can be one of two types:
- health & welfare;
- property and financial affairs.
It is also possible to make an ordinary power of attorney, appointing a nominee to undertake your affairs (for example if you are overseas).
Health & welfare – this allows you to nominate who will make decisions about your treatment if you become incapable. The law normally requires decision to be made in your best interests. This is normally clear. But it can be a useful way of designating who you have authorised to make these decisions for you. For example a situation may arise where a hospital wants to keep a patient in hospital, but the family were able to use a lasting power of attorney to put in place the arrangements that the person wanted, which was to have their last days at home.
Property and financial affairs – this type of power of attorney is perhaps more controversial. There are some known risks, which should be taken into account when deciding who you trust and who to appoint:
- risk of financial abuse.
- risk of premature intervention by the attorney with power.
- risk of the attorney going too far in making gifts out of the money that they ought to be looking after.
- a lack of accountability re managing the money, in that nobody is supervising how that is being done.
- lack of transparency and/or consultation with the maker of the lasting power of attorney (if able) or other family members.
- potential impact that it can have on family relationships.
The power given by a lasting power of attorney should only be used to look after the best interests of the person involved, not the attorney themselves.
If a person loses their mental capacity without having made a lasting power of attorney, there are alternatives such as a deputyship order. But these are more costly, onerous, and time consuming than a lasting power of attorney. On the other hand there is a greater likelihood that the relationship with the family will remain cordial.
The main safeguard on a lasting power of attorney is that it cannot be used unless and until it has been registered at the OPG. But this has limitations. A better one might be to (a) require the attorney to produce finances, or consult with someone else before making big decisions; (b) limit the attorney’s ability to make gifts, etc.
A lasting power of attorney is a potent document, but well-used it can be a useful one.