Adjusting to the challenges caused by coronavirus has been difficult for all of us. However, for those acting as the executor of the Will during this period, the obligations placed...
Protecting your loved ones in uncertain times – Lasting Powers of Attorney and Wills
With the coronavirus pandemic escalating, we all want to protect those closest to us. Aside from following government guidance on staying at home, is there anything else you should do to protect your nearest and dearest?
Here’s a few steps you can take to make life as easy as possible for your loved ones in case something happens to you.
Lasting Powers of Attorney (LPAs)
Lasting Powers of Attorney (LPAs) allow you to appoint attorneys to look after you and your assets in case you cannot do so yourself. This would generally be in a situation where you lost mental capacity but can also apply following a loss of physical capacity or simply being self-isolating (at a time when chosen attorneys may not need to do the same). People tend to associate a loss of mental capacity with old age but it can affect anybody at any point during their life, possibly as a result of dementia, a stroke, or brain injury.
There are two main types of Lasting Powers of Attorney, one to cover your financial and property affairs, and another for health and welfare matters. We suggest:
- If you have already put LPAs in place, locate the documents and make sure they’re registered. Your attorneys may need to use them or you may need to use powers to look after your loved ones, so make sure you know where the LPAs are and that they have been registered with the Office of the Public Guardian.
- Making new LPAs to ensure someone can manage your affairs if you’re not able to. Check with loved ones to see if they need to make LPAs so you or someone else can step in if necessary.
Are you involved in running a business?
LPAs are vitally important for partners in a business, members of an LLP, sole traders and directors. They ensure that if a key decision maker is unable to act, someone else can do so.
If you hold one of the offices mentioned above and were unable to act in that role, this could have catastrophic consequences for the business. For instance, business decisions may not be able to take place, assets could be frozen, contracts left uncompleted, or staff unpaid. Consequently, claims may be brought against the business for its failures.
Who should I appoint as my attorney?
We always recommend that you appoint more than one attorney to act for you. This helps to ensure that if something happened to one of your attorneys, you still have another attorney who can act. The structure of the document is crucial and the key reason to seek specialist advice.
Do I need a separate LPA for business matters?
Our advice is yes. Sometimes those you trust to deal with your personal finances under a Property and Finance LPA may not be the best people to act on your behalf in relation to business matters. For this specific purpose, select who understands your business and how it operates.
To assist your attorneys, it can also be helpful to draft a separate memorandum of wishes to set out intentions and views about the business.
What happens if I don’t have an LPA and I lose mental capacity?
In this situation, a family member or friend would need to apply through the Court of Protection for a Deputyship Order. As a result, the person who applies to the court may not be the person that you would have wanted to deal with your affairs. Further, the process of applying through the courts can be very costly, time consuming, and be a heavy administrative burden. Whilst the court application is ongoing, assets and bank accounts can be frozen for lengthy periods of time, including accounts held jointly with others.
Whilst none of us really want to think about drafting or updating our Will, it’s a vital document. It helps to ensure the right people inherit from your estate and avoids costly delays if you were to pass away.
Many people believe that their situation is straightforward and they only require a simple Will, but this is not always the case. Without the right structure, your loved ones could miss out on inheriting from your estate. This could be as a result of your surviving spouse, civil partner or partner making a new Will or remarrying (however unlikely that may seem), future care costs, a divorce within the family, or if a child found themselves in financial difficulty and was exposed to creditors/bankruptcy. We therefore recommend that you seek specialist advice from a Solicitor or other qualified legal professional when drafting or updating your Will.
In light of recent events, we would encourage everyone to review their current situation, and to ensure that they hold all of these key documents. Naturally, we hope we will all remain fit and well, and be around for the foreseeable future and so, if nothing else, taking action will give you peace of mind knowing that your affairs are in order.
Please contact our team to arrange a no obligation appointment with one of our lawyers.