Do Not Rush To Use A Lasting Power of Attorney
Published / Last Updated on 17/02/2025
Lasting Powers of Attorney (LPA) are a must for us all to enable loved ones to look after our health and/or wealth when we lose physical or mental capacity.
That said, we urge constraint in that you should only use an LPA as a ‘last resort’.
LPAs are live and valid on the day the Office of the Public Guardian (OPG) issues them. That said, we have already highlighted that attorney’s have personal liability and a legal requirement to act in the best interests of the ‘donor’ (the person who set up the LPA). You can be prosecuted if you us an LPA when someone still has capacity, or you abuse the LPA and do not use assets in the best interests of the donor.
See: Attorney & Trustee Investing
Do not ‘Jump the Gun’
- If the donor has periodic capacity, you should always wait until they are ‘compos mentis’ i.e., they have control of their mind and can make decisions then.
- What if when they have periods of capacity, and you have done something they disagree with? What if they report you?
- Why if another family member reports you for using the LPA when the donor has periods of capacity.
- What if you present an LPA e.g., to the bank or pension or investment company and you then withdraw unusual amounts of funds?
- Will the bank ask questions? They should do.
- Whistleblowing
- If you don’t have a valid reason for taking an action, any person or organisation that suspects you are abusing your powers has a duty to report you to the OPG.
Capacity versus incapacity is a very fine line and you should always seek the advice of health professionals on capacity or lack of capacity.
In addition:
- We suggest you should always take professional legal, tax and financial advice before making any major financial decisions for the donor.
- We also suggest with any major decisions or transactions e.g. selling a property, withdrawing larger sums from banks, or changing a Will, you should always contact the OPG for clarification and to make sure they also believe you are acting in the best interests of the donor and document it.
Remember, it is not your wealth, it is not your health. Your own preferences, bias, attitude to risk, political or tax views must be ignored. You should act as if you were the donor themselves and act in their best interests.
Related Videos
