What happens if you lose mental capacity and you haven’t made a lasting power of attorney?
It can be difficult to look to the future and imagine yourself becoming incapable of making decisions.
Getting your affairs in order from a legal standpoint is one way to impose a little more certainty to a challenging prospect and offer some peace of mind.
What are lasting powers of attorney?
A lasting power of attorney (LPA) is a legal document which enables you to choose in advance who you would like to make decisions for you in the event you are unable to make decisions yourself. There are two types of LPA: one for decisions about property and financial matters, the other for decisions about health and welfare.
In order to be used, LPAs need to be registered with the Office of the Public Guardian, who validate the documents and keep a record of them (the registration fee is currently £82 per LPA). Once an LPA has been registered, if you subsequently lose mental capacity, the people appointed under the LPA (your ‘attorney/s’) can use the LPA to make decisions for you and manage your affairs straightaway, without any delay.
What if you haven’t made lasting powers of attorney?
If you haven’t made LPAs and you lose mental capacity to make decisions for yourself, but for some limited exceptions, no one (including your spouse/partner and immediate family) will have any legal authority to make decisions on your behalf.
In the case of financial decisions, this would mean for example that no one would be able to access a bank account in your sole name to make payments on your behalf, unless you have set up third party access whilst you have capacity. If you owned a property which needed to be sold, no one would be able to sign the sale documents on your behalf. The only financial matter those close to you could assist you with would be any welfare benefits you may be entitled to, as they could apply to the Department for Work and Pensions to be your ‘appointee’ to manage your benefits for you.
In the case of health and welfare matters, many people assume their ‘next of kin’ (i.e. your spouse or closest relative) automatically have the right to make decisions for them. In fact ‘next of kin’ is not a legal status in English law. Instead, decisions about where you live or what medical treatment you receive would be left to social workers and doctors to decide and whilst they would consult with your family and friends, your loved ones would not have the final say on decisions made for you.
If your family members wanted the authority to make decisions for you, they would need to make an application to the Court of Protection, which is a court dedicated to making decisions about people who lack mental capacity. The Court of Protection could appoint someone as your ‘Deputy’ by making a court order granting them the authority to make decisions on your behalf. As with LPAs, there are two types Deputies: those who make decisions about health and welfare matters and those who make decisions about property and finances.
Whilst it is possible for your loved ones to be appointed as your Deputies, as this involves a court application, the process can be very time-consuming and expensive. It can take six months for the Court of Protection to process applications and there is a court fee (currently £371) as well as the cost of any legal advice they may wish to obtain.
Once appointed, in the case of financial Deputies their decisions would be overseen by the Court of Protection via the Office of the Public Guardian. The Deputy would be required to prepare and submit yearly reports accounting for all financial transactions and decisions made on your behalf.
Why make an LPA?
The cost and delay involved in a Deputy being appointed is a clear practical reason to make LPAs whilst you have the necessary capacity to do so. Having a registered LPA in place can for example help to prevent you getting into financial difficulty due to your funds being inaccessible whilst you wait for a Deputy to be appointed.
Perhaps a more compelling reason to make an LPA though is that it allows you to make the choice yourself as to who you want making decisions for you when you cannot. Without a valid LPA, you leave this decision up to others and it is not inconceivable that someone could be appointed as your Deputy who you would not have chosen to be managing your affairs. The benefit of choosing your attorney/s in advance also means that you can discuss your wishes with them so that if/when the time comes, they can take these into account when making decisions for you.
If you require any advice or assistance with making LPAs, or with applying to become a Deputy, we can help.
