Six Reasons Why Everyone Should Make A Lasting Power Of Attorney
It is a good idea for every adult to make a Lasting Power of Attorney (commonly known as an LPA). An LPA allows a family member or close friend to deal with assets if mental capacity is lost.
If you were to lose your mental capacity but have not created an LPA, your family or close friends would have to apply to the Court of Protection for a Deputy Order. The following are the main reasons why an LPA is the preferable option.
1. It is a simpler procedure. The Court of Protection process starts with three lengthy and detailed forms, a specific medical certificate that has to be completed by a medical specialist and notices to be served both before and after the appointment is made. With an LPA there is just a single document to sign, one application form and notices that only have to be sent once.
2. It saves time. If you have an LPA in place that needs to be registered then the registration time is about twelve weeks. If a relative or close friend needs to apply to the Court of Protection it can be as much as twenty one weeks for the appointment to be made, almost double the length of time.
3. It costs less. If an application has to be sent to the Court of Protection then there is not just a fee of Aï¿½400 but also a fee to pay for the medical report and an insurance bond. Compared to this theLPA registration fee is just Aï¿½120. In addition the legal costs you would expect to pay for dealing with an LPA are also less than those for the Court of Protection.
4. There are no annual fees to pay. Once the LPA is made and registered there are no more fees to pay. With the Court of Protection there are almost always annual fees and an annual security bond fee to pay. These can amount to hundreds of pounds to be paid every year that will erode away your income and capital.
5. There are no annual accounts. With LPA’s your attorneys have a duty to ensure they keep records of expenditure, but do not have to go to the trouble of completing and submitting yearly accounts. The Court of Protection will order that the person they appoint to act for you, sends them a full account of what has been received and spent. They will have to do this every year. This can be especially burdensome in detailing every item of expense and income, which must be accurate to the penny.
6. You decide who acts as the attorney. With an LPA you are in charge of appointing your attorneys and deciding how they should act. With the Court of Protection you will probably not be in a position to have a say about who applies to act on your behalf. The result could be that a person who you would not have chosen yourself, is the person who the Court of Protection gives authority to deal with all your financial affairs.
The most important thing to remember is that you must have mental capacity to make an LPA. If mental capacity is lost then so is the chance to create onw. You are then left with the Court of Protection, and the additional time, administration and expense that this brings. To avoid all this it is far better to make an LPA while you are able to do so.