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Attorney's Roles and Responsibilities - Where to Start?

on Wednesday, 10 October 2018.

Most people are aware that there are two types of Lasting Power of Attorney (LPAs), a Property and Finance LPA and a Health and Welfare LPA.

Attorneys under each type have different roles and responsibilities, but both should remember that they have various duties of care towards the person who appointed them (the donor) and that above all, they must act in the best interests of the donor. 

Donors can appoint more than one attorney if they choose, who can either be appointed to act 'jointly' or 'jointly and severally'. The distinction is that if attorneys are appointed jointly then both or all the attorneys must agree on the decisions being made, no matter how big or small, before any action can be taken. Attorneys who are appointed jointly and severally have more flexibility, as they are able to act independently of each other too.

Problems can arise in practice if an attorney is unclear about what they are able to do and what is not permitted. We have set out below some helpful points that attorneys should be aware of, depending on which type of LPA they act under.

Property and Finance Attorneys

Attorneys need to check if there are any restrictions made in the LPA by the donor about the authority they have to act. An example of a restriction could be that the attorney is not authorised to sell property on behalf of the donor without seeking specific permission to do so from another party or from the Office of the Public Guardian.

If a donor has made no restrictions on the attorney's authority to act, the attorneys have relative freedom to act, taking steps such as paying bills, signing cheques and investing funds.

Attorneys should also seek out any letter of wishes that the donor may have made with the LPA, in which the donor may set out their individual preferences or instructions to their attorney.

Certain generic restrictions also apply, such as in making gifts and it is important to be aware of those restrictions.

Making Gifts

Regular gifts may be made from the donor's accounts, as long as they are gifts that the donor would have made and provided they are within certain limits. As a rule of thumb, gifts of more than £3,000 in any single tax year are likely to exceed the limit. For gifts that are in excess of the limits, Court approval is required. If an attorney is in doubt about whether a gift may exceed the limits, expert advice should be obtained.

Keeping Accounts

As an over-arching principle, attorneys should never mix a donor's finances with their own. Separate accounts should always be maintained so that the donor's money is clearly identifiable from the attorney's.

Attorneys should record and list all expenses that they incur and for which they seek reimbursement from the donor's funds. The expenses must be reasonable and have been incurred in their role as an attorney.

Attorneys should also remember to register the LPA with the donor's bank. This can be done as soon as the LPA has been registered, or when the donor loses the ability to act for themselves. If the donor still has capacity, the attorneys should check that the donor wishes them to register the LPA on the donor's account before taking any action.

Health and Welfare Attorneys

A Health and Welfare LPA is different from a Property and Finance LPA in that it can only be used once the donor has lost capacity.

Attorneys can, at that point, make decisions about the donor's medical care, pay for the donor's clothes or other personal care expenses (such as hairdresser costs, toiletries and food) and provide the donor with extra day-to-day support. 

The LPA should be registered with the care home and hospital, if appropriate to do so.

What if Different Attorneys Are Appointed for Different Tasks?

If the donor's attorneys for Health and Welfare are different from the attorneys for Property and Finance, it is important that both sets of attorneys discuss with each other the effect certain decisions would have on the donor.

The most obvious example is moving the donor to a care home. The division of tasks in that example would be that the attorney for Health and Welfare decisions would pick a suitable care home that meets the donors needs, but the Property and Finance attorney would check whether the donor has the means to pay for care at that care home and be responsible for making those payments.

Specialist Advice

Given the pitfalls for attorneys who do not fully understand the implications of their role, we recommend that specialist advice is sought by attorneys when taking up their role. In this way, attorneys can be clear about their duties and powers from the outset and be made aware of any specific or general restrictions they must follow.

Our expert team of advisers are well-versed in guiding attorneys through the requirements of their role.

If you require advice on Lasting Powers of Attorney, please contact Megan Seabourne in our Private Client team on 01923 919 360.

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