People are living longer now, but Alzheimer’s and other age related brain diseases are on the rise, with the effect that a sizable portion of society in their later years are no longer capable of making important decisions for themselves. How do they look after their affairs when thy no longer have the capacity to do so? Luckily there is a powerful legal document called an Enduring Power of Attorney which can be of assistance
Enduring Power of Attorney
A Will enables a person to ensure his or her wishes are carried out after death, but what happens when the person is still alive but, due to dementia or some other form of mental decline, is no longer capable of making decisions for themselves? How do they sign documents? How do they deal with financial affairs or sell property? How do they pay for their Nursing Home costs when their money is in a bank account which is accessible only to the account holder?
Unless they have created an Enduring Power of Attorney, the person’s family members cannot carry out these simple tasks on behalf of their loved ones. In order to do so, they will face a long-winded and costly application to the High Court to attempt to have the authority to manage their affairs and make important decisions for the person’s own benefit. By contrast, if the person had previously created an EPA, then life becomes much more straightforward and cost efficient for family members.
Step 1: Creating an Enduring Power of Attorney
An Enduring Power of Attorney is a legal process in which you (‘the donor’) give the legal right in writing to one or more people, the ‘attorneys’, to manage your financial affairs and property if and in the event that you begin to suffer from mental decline in the future.
It is distinct from a regular Power of Attorney which ceases to have effect once you lose your mental capacity. The EPA on the other hand “endures” once you’ve been diagnosed with Alzheimer’s or some other form of mental decline.
Your attorney does not have to be a solicitor; you can appoint a family member or a friend. This option gives you the opportunity to have a say about your future, and it will also make it easier for your family members and carers to act on your behalf in the future.
If the attorney cannot act, a well prepared EPA will have factored this in by also appointing a sub-attorney to cover just such an event. Quite often a donor will appoint a spouse to act as attorney and a son, daughter or close friend to act as a sub-attorney in the event that the spouse is unable or unwilling to act, for whatever reason.
It is important that someone trustworthy is chosen to act as an attorney, and before choosing someone, it is important that the appointment be discussed with them. As this is an extremely important role with significant responsibility, the proposed attorney should be informed and willing to take on the role.
An attorney’s responsibility is to make all decisions in the donor’s best interest. The donor can restrict or specify the types of decisions the attorney can make, or give a more wide-ranging and general authority to allow them to make all decisions on the donor’s behalf.
The proposed Attorney(s) must sign the document to certify their understanding of the duties and obligations assumed by virtue of the appointment. Similarly a notification of the creation of this power must be served on two other persons (usually other family members who were not named to act as attorney) to alert them of the creation of this document.
Once the document is created, it is kept in a safe place (much the same as a will) until such time as it is required. It is important to note that when the EPA has been created the power does not become effective until the Donor starts to become incapable of managing their affairs, at which point an application can be made to register and activate the EPA.
Step 2: Activating the Enduring Power of Attorney
If it becomes clear to a family member that the Donor is suffering from mental decline, then this is the time to activate the EPA. It is necessary to first confirm this mental decline with a medical certificate from the person’s doctor. The attorney should then approach their solicitor who can Register the EPA on their behalf.
This procedure takes an average of three months. In the meantime, the attorney may act in a limited way to maintain the donor and prevent loss to the donor’s property and savings. They may also make any urgent personal care decisions that are authorised in the document and which cannot be put off until the registration is complete.
A notice of the attorney’s application to register the EPA must be served on the donor and also on the people who were notified of the execution of the EPA and are named in it, usually this will be the donor’s family members, for example other sons/daughters who were not named to act as attorney.
Any person served with this notice can object to the registration, for example it may be their view that the proposed attorney is unsuitable to act or unduly influenced the donor into appointing them. The grounds for objection must be sent to the Office of the Wards of Court within five weeks on receipt of the notice.
An EPA is an important and powerful document that may involve potentially complicated drafting and therefore it is all the more vital to take legal advice when seeking to create an EPA. We at M.M. Halley have helped clients for many years to create these documents and increasingly we are receiving instructions from more and more clients to activate them.
If you have any queries in relation to Enduring Powers of Attorney please contact Frank Halley.