What Decisions can an LPA make?

Here I answer the question: “what decisions can an LPA make” (i.e. an appointed attorney)? Broadly, powers granted by an LPA are far reaching, however, they are constrained, not only by law but by the rights of other interested parties.

  • Attorneys have wide ranging powers to step into the shoes of a donor
  • Attorneys must act in the best interests of the donor, a calculation which is not trivial.
  • Attorneys’ powers interact with the donor’s rights/obligations as well as those of third parties.

 

Firstly, we have to be clear that there are two Lasting Power of Attorney (LPA) documents, one deals with Health and Welfare matters and one with Property and Financial affairs. Different attorneys may be appointed by each, and each document may constrain the decision-making power of the other.

There are intuitive “divisions of labour” between the two LPAs, however, also areas in which the line is blurred. Where costs are involved, health decisions may have implications for financial and vice-versa.

The best interests test introduces additional constraints, which may be more nuanced than immediately apparent. Taking the Health and Welfare document, attorneys are required to act in the donor’s best interests in the context of their values and beliefs.

Powers nominally include: decisions about the donor’s place of residence; medical treatments; personal care; life sustaining treatments etc.

If, however, an attorney disagrees with e.g. a GP, on a treatment for the donor, (subject to proper discussion) the GP may apply to the courts to act in the best interests of the donor. Courts are slow and GPs may deliver treatments while decisions are made. Thus, the decision of the attorney may be overruled.

With respect powers conferred by a Property and Finance LPA, powers nominally include: purchase/sale of Property; home maintenance; management of tax, bills and benefits etc. (for clarity, attorneys may not amend wills or take on trustee roles for a donor).

Once again, the best interests test may result in surprising complexity. Personally, circumstances in which donors assert that attorneys should make certain gifts on their behalf e.g. to charities or relatives, are entirely reasonable. Where wording is poor, however, and gifts mandated to the detriment of the donor, LPAs have been known to fail altogether.

Even greater complexity may arise where the donor has an interest or senior role in a business. In such circumstances, their role (e.g. a directorship) may demand them to act contrary to personal interests, in those of a company. In such situations it is not uncommon for donors to register multiple Property and Finance LPAs. Here, the powers of one attorney are not implicitly subordinate to those of another and negotiation must take place to avoid becoming stuck.

The picture that emerges, when one considers the decision-making powers of LPA appointed attorneys is one of a network of interacting and overlapping powers and obligations, aimed not only at upholding the rights of the LPA donor as a citizen, but at integrating their freedoms and responsibilities with the interests of those with whom they interact.

Lasting powers of attorney are often pivotal to quality of life. If you don’t know where to start, my advice is: start!

If you’re considering these issues, I urge you to act now, speak to our client advice team on 0121 202 4714 or click here and we’ll call you.