Dealing with an elderly relative's affairs
Solicitor Katy Burgin talks about methods of helping a relative with their finances and personal welfare.
When a family member becomes mentally incapable of managing their own affairs, it is often necessary for someone to step in and take over the handling of financial matters on their behalf. In English law there are a couple of methods of achieving this. The most appropriate method will often depend on whether the person has already lost mental capacity, or whether a solution has been put in place in advance of this situation arising, which it is possible to do by setting up a Lasting Power of Attorney (LPA).
Here, specialist solicitor Katy Burgin outlines the different legal devices available to deal with both scenarios.
Loss of mental capacity commonly arises due to the following reasons:
- Age related problems ( Dementia, Alzheimer’s disease, Stroke)
- Mental illness
- Mental handicap
Generally, if someone has already lost mental capacity it will be necessary for a family member to apply to the Court of Protection to be appointed as their deputy. This means that someone will be legally entitled to manage that person’s finance and property matters.
Deciding which route to take when you are faced with a situation where someone needs help is not easy. It is often the case with diseases such as Alzheimer’s and Dementia that the person involved will have fluctuating mental capacity, good days and bad. In these cases we may seek medical advice to help determine the best solution.
An expert solicitor can help you to determine whether the Court of Protection or a Lasting Power of Attorney is the most suitable route.
Making preparations in advance
Many people are concerned about what will happen to them in the event of losing mental capacity through such illnesses as Alzheimer’s disease, dementia or a stroke. The Lasting Power of Attorney is a legal document, introduced in 2007, in which you can nominate someone to deal with your affairs. The idea behind the introduction of the Lasting Power of Attorney is that even someone with reduced mental capacity should still be able to exercise some control over what happens to them.
By setting up an LPA in advance you are able to choose someone you trust to deal with your affairs. If you do not have an LPA, and later lose mental capacity, then someone will need to apply to the Court of Protection to become entitled to manage your affairs and this may not be the person you would have chosen yourself.
You can set up an LPA so that it only activates once you are medically diagnosed as having lost mental capacity.
It is possible to appoint more than one person to be you attorneys. You can nominate them to make decisions jointly or you can give certain decision making abilities to each of them.
There are two type of LPA available, each with different powers, and you can tailor make an LPA to suit your requirements. The LPA’s available are:
Property and Affairs Lasting Power of Attorney
A Property and Affairs LPA gives someone the authority to deal with your finances such as receiving income and benefits, dealing with banking and general finances and handling your property, including buying and selling.
A Property and Affairs LPA can be set up to be used immediately or only after the donor loses mental capacity.
Personal Welfare Lasting Power of Attorney
A Personal Welfare LPA is different in that it can only take effect after the donor’s loss of mental capacity.
A Personal Welfare LPA enables the attorneys to make decisions about your personal healthcare and welfare. This can include giving consent to or refusing medical treatment, deciding whether you continue to live in your own home or go into residential care, and your day to day care if your are already in a care home.
An option also exists to give your attorney the power to make decisions about ‘life sustaining treatment’, although this section is something that you have to explicitly authorise when you set up the LPA.
Attorneys have a duty to act in the best interest of the donor at all times and certain legal restrictions are in place to limit what they are able to do.
Lasting Powers of Attorney can be complex and legal advice should always be sought.
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