Article – What is Power of Attorney

Power of Attorney (POA) is a legal document that allows you (the “donor”) to appoint one or more people (the “attorneys”) to make decisions on your behalf. This can be incredibly useful for various situations, ensuring your affairs can be managed if you become unable or unwilling to do so yourself. It’s a powerful tool for planning and safeguarding your future. 

The Core Concept: Granting Authority

At its heart, a Power of Attorney is about granting legal authority to someone you trust to act in your best interests. The scope of this authority can be broad or very specific, depending on your needs and wishes. You decide what powers you want your attorney(s) to have.  

Different Types of Power of Attorney:

The most common types of POA include:

  • Ordinary Power of Attorney: This type grants your attorney(s) the power to make decisions on your behalf, usually in relation to your financial affairs. However, it is only valid while you have the mental capacity to make your own decisions. If you lose capacity, an ordinary power of attorney automatically ends. This type is often used for specific situations, like managing property while you are abroad.

 

  • Lasting Power of Attorney (LPA): This is designed to cover situations where you lose the mental capacity to make your own decisions in the future. There are two types of LPA in England and Wales (similar systems exist in Scotland and Northern Ireland):  
    • Property and Financial Affairs LPA: This allows your attorney(s) to make decisions about your money and property, such as paying bills, managing investments, and selling your home. It can be used while you still have capacity with your permission, and continues if you lose capacity.  
    • Health and Welfare LPA: This allows your attorney(s) to make decisions about your healthcare and personal welfare, such as medical treatment, daily care, and where you live. This type can only be used once you have lost the capacity to make these decisions yourself.

Key Aspects of Power of Attorney:

  • Donor: The person creating the Power of Attorney.
  • Attorney(s): The person(s) appointed to act on the donor’s behalf. They must be over 18 and have the mental capacity to act.  
  • Capacity: The donor must have the mental capacity to understand the implications of creating a Power of Attorney at the time they make it.  
  • Registration (for LPAs): Lasting Powers of Attorney must be registered with the Office of the Public Guardian (or equivalent in other regions) before they can be used. This provides a safeguard and allows the OPG to investigate any concerns.  
  • Scope of Authority: The document clearly outlines the specific powers granted to the attorney(s).  
  • Joint or Several Attorneys: You can appoint multiple attorneys. You can specify whether they must act together (jointly) or if they can act independently (severally).  
  • Best Interests: Attorneys have a legal duty to act in the donor’s best interests at all times.  

Why is Power of Attorney Important?

Creating a Power of Attorney offers several significant benefits:

  • Maintaining Control: It allows you to choose who you trust to make important decisions for you if you are unable to.
  • Avoiding Delays and Complications: Without an LPA in place, if you lose capacity, your loved ones may need to go through a potentially lengthy and expensive court process to become your “deputy” and gain the legal authority to make decisions on your behalf.  
  • Peace of Mind: Knowing that you have a plan in place can provide significant peace of mind for you and your family.
  • Personalized Decisions: Your attorneys are more likely to make decisions that align with your values and wishes than someone appointed by the court.

 

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