When Peter Warrington telephoned his sister, Jane, to wish her a happy new year he was not expecting to be told that she had married her French boyfriend, Sebastien, in France shortly before Christmas. Peter and Jane agreed they should all meet up for dinner in London to celebrate and Jane suggested a new fashionable restaurant where Sebastien knew the maître’d and would be able to get them a table.
The dinner went well but Peter wondered if Sebastien, who had seemingly never held down a serious job for long before the need to find himself on some exotic adventure resurfaced, was expecting to be supported financially by Jane.
Several months later, Peter was approached by a larger rival firm with an offer to acquire EW Ltd. Peter met with Jane to discuss the offer. Jane complained that making such an important decision was giving her a headache. She acknowledged that Peter had been running the business successfully since their father’s death and agreed they should keep the business within the family.
When Jane got home she told Sebastien that she did not feel well and wanted to lie down. A short while later, Sebastien found her unresponsive on their bedroom floor and called an ambulance. It appeared Jane had suffered a cerebral vascular incident due to an obstruction in the blood flow to her brain. Jane did not regain consciousness and was put on life support. The specialist treating Jane asked whether she had given anybody power to make medical decisions on her behalf. Sebastien believed she had given him a power of attorney but would need to check as Jane had insisted he sign several legal papers when they got married.
Key points for advisers – Lasting powers of attorney
A lasting power of attorney (LPA) is a formal legal document that lets a person (the donor) choose trusted people (their attorneys) to make financial decisions and/or health and care decisions on their behalf.
An LPA is mainly used when the donor no longer has the mental capacity to understand and make decisions. Mental capacity is the ability to make a specific decision at the time that it needs to be made. To have mental capacity to make a decision, the person must have at least a general understanding of the decision they need to make, why they need to make it, any information relevant to the decision and what is likely to happen when they make it. They should be able to communicate their decision through speech, signs, gestures or in other ways.
People can sometimes make certain basic decisions but not have the necessary mental capacity to make other more complicated ones.
There are two types of LPA:
1) LPA for financial decisions; and
2) LPA for health and care decisions.
Under an LPA for financial decisions, an attorney can (unless the donor has chosen to restrict what the attorney can do) make financial decisions on behalf of the donor, including decisions such as:
- paying for household expenses, care and other bills;
- opening, closing and using bank and building society accounts;
- claiming, receiving and using benefits, pensions and allowances;
- making or selling investments; and
- buying and selling property.
An LPA for health and care decisions can only be used if and when the donor loses mental capacity and covers decisions about health care and personal welfare such as:
- day-to-day matters such as diet, dress or daily routine;
- where to live and moving into residential care;
- getting help and support from social services; and
- giving or refusing consent to health care.
- special permission can also be given for the attorney to make decisions about life-saving treatment.
All attorneys have a duty to make decisions and act always in the best interests of the donor.
An LPA must be signed by the donor, the attorney(s) as well as by a ‘certificate provider’ who confirms that the donor understands it and hasn’t been put under any pressure to sign it. The certificate provider must be someone who knows the donor well or a professional person, such as a doctor, social worker or solicitor.
The LPA must be registered with the Office of the Public Guardian before it can be used. A registration fee of £110 is payable.
