Many people will be aware that changes to the law relating to Powers of Attorney took place on 1st October 2007. This article is intended to provide a little more detail on the changes.
Enduring Powers of Attorney (EPAS) were introduced in 1987 and replaced on 1st October 2007 by Lasting Powers of Attorney (LPAS), introduced under the Mental Capacity Act 2005.
Firstly, provided your EPA was validly executed prior to 30th September 2007, it remains fully valid and can be used in its normal way. For those involved in the last minute rush to complete an EPA prior to the 1st October, it is valid if you, as donor, signed it before 30th October. Despite conflicting information from the authorities, providing the donor executed a valid EPA by the due date, later acceptance of the role by the Attorney is valid.
Despite this, there may be reasons why you would wish to revoke your EPA in favour of an LPA (severity see below) or to supplement it with an LPA in relation to welfare issues (see below).
There are a number of reasons, the main two being;
- Ageing population. There are already 8 – 900 people in this country over 100. The threat of illness, mental and physical, is an ever-present one and it is sensible and prudent to protect your wealth and health as far as possible, by passing decision making to a trusted person(s).
- Security. The Public Guardianship Office (now renamed as The Office of the Public Guardian), estimates that fraud occurs in 10 – 15% of cases where an EPA has been registered. Considering that previously, EPAs only needed to be registered when the donor lost his or her mental capacity, this is a fairly small number out of the total EPAs in existence and/or use. The new LPAs considerably tighten security, and you may wish to consider an existing EPA in favour of an LPA for this reason alone.
The New LPAS
There are two types of LPAs. The first LPA (PA) is designed similarly to EPAs, to enable somebody to look after your financial affairs. The “safe guards” are up to 5 nominated people, to be notified when an LPA is registered, and a ‘certificate provider’ must sign a certificate to confirm that you have entered into the LPA freely and without undue influence or duress.
A Certificate Provider will generally be a solicitor or other approved professional, although it can be anybody who has known the donor for at least two year.
The major change here, however, is that the LPA must be registered before it can be used. Applications must be made to the Office of Public Guardian (OPG) with payment of the current fee (£150). The OPG notify the persons you have nominated, and they have 6 weeks in which to object, failing which, the LPA will be registered.
To save cost, LPAs can be made (in the same way as EPAs) and held in safe custody until required. This at least postpones the payment of the registration fees. However, once registered, the LPA (PA) can be used whether or not the donor has capacity.
The new type of LPA (PW) is designed to appoint someone to make decisions on your welfare including for example, where you live and day to day care. This type of LPA will also allow your attorney/s to make decisions regarding medical treatment including whether or not to accept lifesaving treatment, if you you authorise them to make those decisions. If you do grant an LPA (PW), it is advisable to register immediately, because this type of power can only be used if you have lost capacity, which will render the power ineffective if this happens before registration.
Although more expensive to set up than EPAs, they are still considerably cheaper than doing nothing and relying on the appointment of a Deputy (Receiver) by the Court of Protection. For once, we have something new which actually seems to improve upon what we had before, unlike Home Information Packs (HIPs), but that’s for another article.
This article appeared in the Wilmslow Express 25/10/07