What does Powers of Attorney mean?
You may have heard the expression Powers of Attorney but not been sure about what it means, if it applies to you or your situation, or what the benefit is.
Having Powers of Attorney documents in place is just as important as having a will. But what does it mean?
What is Powers of Attorney?
In England, a Power of Attorney (POA) is a legal document that allows an individual (the “donor”) to appoint someone else (the “attorney” or “agent”) to make decisions and act on their behalf in certain matters. The powers granted to the attorney can be broad or specific, depending on the donor’s wishes.
There are two types of Powers of Attorney commonly used in England:
Ordinary Power of Attorney: This type of POA grants the attorney the authority to make decisions and act on behalf of the donor in financial and property-related matters. It is typically used when the donor is capable of making their own decisions but wants assistance or needs someone to act on their behalf temporarily, such as during an illness or absence.
Lasting Power of Attorney (LPA): An LPA is a more comprehensive and enduring form of power of attorney. It allows the attorney to make decisions and act on behalf of the donor, not only in financial matters but also in health and welfare matters. An LPA can be used when the donor lacks mental capacity or anticipates losing mental capacity in the future. There are two types of LPAs: one for property and financial affairs and another for health and welfare.
The Mental Capacity Act 2005 governs the creation and use of Powers of Attorney in England. The act provides safeguards to protect the rights and interests of donors, including the requirement for the donor to have mental capacity at the time of creating the POA.
It’s important to note that Powers of Attorney in England must be registered with the Office of the Public Guardian before they can be used. This registration process ensures that the attorney’s authority is recognized and accepted by third parties, such as banks or healthcare providers.
That’s the definition, but in practice what does it mean?
A Powers of Attorney document allows you to decide who will make important decisions for you in the event that you can no longer make those decisions for yourself.
Every individual has the right to manage their own affairs but as we get older, this can become increasingly difficult. This could be due to illness, disability or an accident. Creating a Power of Attorney can ensure there is someone to make decisions for you if this happens.
Taking care of the future
If you have an accident or became seriously ill and are unable to look after your affairs, who would look after them for you? There is a misconception that your spouse or adult child automatically has the right to look after your affairs. If you lose your mental capacity then your loved ones cannot automatically look after your affairs. Making a Lasting Power of Attorney ensures that you retain control of who makes decisions on your behalf in circumstances when you are unable to make decisions for yourself.
An important thing to remember is that the POA must be in place before you ever need it. Having it in place doesn’t mean that someone else can make decisions for you if you still have capacity.
If the last few years have taught us anything, it’s that life can be very unpredictable. We can’t know when an accident may happen or a pandemic show up, but we can have things in place to make it easier for our loved ones. Having a will and power of attorney in place mean that your wishes will be respected. Talking things through with your family when it is set up also helps should anything happen.
People shy away from having these conversations with family because they don’t want to make people feel upset or uncomfortable. However, the upset caused when these documents aren’t in place far outweighs having that conversation.
It is important to remember that once capacity is lost, for whatever reason, you lose the right to put Powers of Attorney in place and this means that a Court of Protection order would be required. This process is more costly and more time consuming.
Levins can help
If you are considering creating a power of attorney or have questions about the specific legal requirements and implications, then please do get in touch. Our team are experienced and understand that these situations need to be dealt with sensitively and with compassion.
You can find out more about our Private Client services here: Private Client Services
As always if you require any help or advice regarding Wills, probate, POA or Trusts, then please do get in touch, we’re here to help: Contact us