Enduring and Lasting Powers of Attorney

 

The Mental Capacity Act 2005 came into force on 1^st October 2007 and replaced the Enduring Powers of Attorney Act 1985.

 

What is an Enduring Power of Attorney?

 

An Enduring Power of Attorney (EPA) is a document entered into by an individual (the Donor) who has mental capacity and wishes to appoint someone to act on their behalf (the Attorney).

 

Why is an EPA needed?

 

Donors often wish someone (spouse/civil partner/children/relatives/friend) to assist them in dealing with their personal affairs, such as dealing with utilities companies, financial institutions or government departments either in person or on the telephone.

 

Without an EPA in place such a person will not be able help as the institutions will only deal with the individual directly or a legally appointed representative (the Attorney).

 

When does an EPA become operational?

 

The EPA comes into effect as soon as it has been completed and signed by the Donor and the Attorneys. The Attorneys can then act on the Donors behalf.

 

What authority does the EPA give to the Attorney?

 

The Attorney can make exactly the same decisions as the Donor can make about their property and financial affairs (when the Donor has the mental capacity to do so). The powers given to the Attorney can be limited or have to meet certain conditions. Ultimately the Donor has to trust the Attorney(s) they appoint to act in their best interests.

 

How will the Donors ability to make decisions be affected?

 

Until the EPA is registered, the Donor and the Attorney have equal authority to make decisions about the Donors property and financial affairs. If the EPA is registered then the Donor can still make decisions, provided they are still capable of doing so at the time.

 

What happens if the Donor loses mental capacity?

 

Then the Attorneys are under a duty to register it with the Public Guardian (part of the Court of Protection). They must give written notice to the Donor, any co-attorneys and at least three of the Donors closest relatives (any of whom can object to the registration).

 

Can the EPA be revoked by the Donor?

 

Provided the Donor has mental capacity then they have the power to revoke the EPA. If the EPA has been registered then an application to the Court of Protection will have to be made.

What happens on 1^st October 2007?

 

The Mental Capacity Act 2005 will come into force. The legislation governing EPAs will change. EPAs signed on or after 1^st October 2007 will not be valid.

 

What replaces the EPA?

 

The EPA is to be replaced by a new Lasting Power of Attorney (LPA).

 

What are the main differences between the EPA and new LPA?

 

As well as property and financial affairs the Attorney can make decisions relating to personal welfare (including giving or refusing consent to treatment). The Attorney will only able to make health and welfare decisions where the Donor loses mental capacity.

 

The LPA forms are approximately eight times longer than the average five page EPA document which means an increase in costs for their completion

 

The Attorney can only act on behalf of the donor if the LPA is registered with the Public Guardian, irrespective of the mental capacity of the Donor.

 

To register the LPA with the Public Guardian a fee will have to be paid. Currently to register an EPA there is a cost of £120. Although the Public Guardian has not formally published their new charges we understand that registration fees can total up to £300 (£150 per section).

 

Registration of the LPA will require notification of five persons named listed in the LPA document.

 

The LPA imposes a statutory duty to act in the best interests of the Donor. Attorneys will also be expected to follow a Mental Capacity Act Code of Practice.

 

What happens if there is no EPA or LPA in place?

 

In the event of mental incapacity an application must be made to the Court of Protection and the Court will appoint a suitable Receiver. The Court may appoint family members, but in some circumstances may deem it necessary to appoint professional receivers, such as Solicitors or Accountants. In such circumstances the individual does not have the choice of whom they wish to have to act on their behalf.

 

Due to the increased involvement of the Court, Receiverships tend to be more expensive processes and take longer to put into place than EPAs or LPAs.

 

 

If you would like further information on any of the issues raised then please contact Mitchell Thompson or Cheryl Thompson on 0208 658 3922. While we have made every effort to provide accurate information this leaflet is no substitute for specific advice.

 

 

August 2007