The Role of Attorney- what to consider before agreeing to act.
In our last edition of Wealth Preservation Matters, we considered the role of executor, what can go wrong when carrying out this role and how to avoid problems. If you missed it, you can read the article here.
In this edition we consider the role of an attorney. When someone (known as the donor) makes a Lasting Power of Attorney (LPA) they appoint one or more individuals (known as attorneys) to make decisions on their behalf. Before agreeing to take on the role of attorney, you should think carefully about whether you wish to take on the role.
The role of an attorney is unpaid (unless you are a professional attorney and a specific charging clause is included in the LPA) and can be very time-consuming. If you do not think you have the time to take on the responsibilities or required skill set, it is best to discuss this with the donor before you sign the LPA and agree to take on the role.
It should be noted that an LPA does not give the attorney unlimited authority to make decisions on the donor’s behalf. Before the attorney actions a decision, it is important to consider the LPA to check whether they have the authority to make the decision. Important points to note are:-
- The attorney cannot act under the LPA until it has been registered at the Office of the Public Guardian;
- The LPA for property and financial affairs may be restricted so that the attorney can only make decisions if the donor has lost capacity;
- The attorney can only make a decision under the LPA for Health and Care if the donor has lost capacity;
- If there is more than one attorney appointed, the LPA will state whether the attorneys need to liaise with each other prior to making a decision;
- Unless there is a specific instruction in the LPA for property and financial affairs, an attorney has very limited authority in respect of making gifts;;
- If the attorney wishes to carry out tax planning on behalf of the donor, an application to the Court of the Protection will be required prior to making the gift; and
- The LPA for Health and Care may give the attorney the authority to make decisions on behalf of the donor in relation to life sustaining treatment. This decision will often need to be made in difficult circumstances and it is important that the attorney is comfortable making such a decision and is aware of the donor’s wishes.
Being appointed as an attorney can be an onerous role, it is therefore vital that consideration is given by the attorney before agreeing to take on the role. If you are a donor making an LPA it is important that you discuss the types of decisions that will need to be made with your attorney so that they are fully aware of the role before signing the LPA.
This update is for general purposes and guidance only and does not constitute legal or professional advice. You should seek legal advice before relying on its content. For advice, get in touch with your usual Greenwoods GRM contact or scroll down to complete our enquiry form.