Let’s talk legal... Lasting Power of Attorney

By Evolve Family Law

Many of us are asked to deal with a financial issue for a relative or partner without the paperwork or authority to speak with the bank or financial institution and have them take the necessary steps. The relative may need a bill paid or the account details changed, and you feel as if you are going round in circles with the bureaucracy of a bank, building society, or pension provider.

A Lasting Power of Attorney (LPA) for financial affairs is a legal document that enables a trusted person (called an attorney) to manage the financial affairs of someone who has authorised them to do so.

An LPA is flexible. It can be used when a relative has lost the capacity to make their own financial decisions or manage their money, or when they are unable to do so due to hospitalisation or frailty.

The reality is that most of us don’t sign an LPA when we are in our 20s or 30s because we don’t think we will be the unlucky one who has a skiing or road accident. Years pass, and then mention of an LPA becomes a sensitive topic.

It can be hard to mention an LPA to a relative because you don’t want your family member to think that you view them as incapable of managing their money. However, every adult should have an LPA, whatever their age. That’s because none of us can predict when we might need a loved one to step in and help us manage our money, temporarily or permanently.

Whether it is just one bill or a phone call to a bank, it may be time to talk about your loved one giving you the legal authority to help you sort out their financial affairs when either asked to do so or permanently when they no longer have the capacity to do so.

What happens if you try to muddle through and help a relative without an LPA? If you are being asked for occasional help with sorting out online banking or phone calls, you may be able to manage. However, if your relative loses their capacity to make all their own financial decisions, they will be unable to sign an LPA. Your only remedy to get their bills paid is to apply to the court for a Deputyship Order. That takes time (during which you may not be able to access your relative’s money to pay care home or other bills) and is much more expensive than registering an LPA.

LPA law means there are safeguards for the LPA writer:

1. The attorney must act in the interests of their relative, not their own.

2. If the relative has capacity or some capacity, the attorney must consult the relative about when they will step in to help and the decisions they make.

3. The LPA writer can appoint more than one attorney and say that the attorneys should make joint decisions.

At Evolve Family Law, we recommend that you get your relative to speak to a solicitor about what an LPA involves and how it can be made to work for them. The lawyer acts for your relative (not you as their intended attorney), ensuring their interests are protected whilst explaining the drawbacks of not having an LPA or an up-to-date Will.