Thinking and planning ahead – Whilst you are able

Who will handle your financial affairs if you experience a debilitating accident? Rose Phelps insists that today is a healthy time to make a lasting power of attorney.

A road accident or serious sporting injury can happen to someone of any age and a catastrophic stroke or rapidly developing degenerative illness can strike almost as quickly.

If you have not made a lasting power of attorney who will deal with your property and financial affairs? Who will make personal welfare decisions for you, for instance to chose a care home, request or decline medical treatment, or make decisions about life-saving treatment?

The best time to make a lasting power of attorney is when you are in good physical and mental health, but in our experience many clients put off doing this, just as too often they put off making a will.

With a property and financial affairs lasting power of attorney, you can appoint attorneys to deal with those issues for you, or with a personal welfare lasting power of attorney, you can pick attorneys to make more personal care or health-related decisions for you, for instance choosing a care home, requesting or declining medical care, or making decisions about life-saving treatment.

Sadly, losing capacity to deal with one’s affairs or make decisions about one’s welfare is linked in the public consciousness with old age, Alzheimer’s disease and other dementia.

The most difficult cases we deal with are clients who do not have a power of attorney in place and have had a road or sporting accident, catastrophic stroke, or have a rapidly developing degenerative illness. These can happen to anyone at any age.

Problems also arise where clients leave it too late. If you decide to make an lasting power of attorney precisely because you already have serious health issues, or are sometimes confused, you may still be able to make one, but your GP or consultant will probably need to be involved too.

If you become too unwell to visit your solicitor, you may have to pay for them to come and see you, and older clients may be advised to ask a psycho-geriatrician to assess their capacity to understand and execute the power of attorney.

All this can make the process slower, more upsetting and stressful, and much more expensive than making one when you are in good health (while crossing your fingers it will never be needed).

If it is family concern or pressure that brings the solicitor to your door, you may already be past the point where you could understand and make a valid lasting power of attorney, or you may be unduly influenced by others.

If you do not make one and then lose mental capacity to do so, then despite indications to the contrary in the press and broadcast media, no one can "get a power of attorney" for you. In that situation, someone has to apply to the Court of Protection for the appointment of a "deputy". This is much less straightforward than making a lasting power of attorney. It generally involves higher costs and more administration costs in the future and may take many months to complete. The Court will remain involved in your life long-term, though the deputy is in charge from day-to-day. One constant over the years is the backlog of work at the Court of Protection and time-scales for applications are routinely extended.

More and more of us live for many years after illness or frailty sets in and have complex family situations – second marriage, unmarried partners, children and step-children. All these make some cases more complex and increase the Court’s general caseload.

Expediting applications is very difficult. This means delays in getting access to income or capital to use for your benefit, as well as in putting long term investment or care strategies in place.

If you have a major shareholding in a family company, run your own business, are a trustee of a trust, or have substantial assets and a complex investment portfolio, this delay can be financially disastrous.

If the Court of Protection does appoint a deputy, it may not be the person you would have chosen yourself. The court will do its best to pick someone reputable, honest and with your interests at heart, but the onus is on someone to apply to be the deputy – there is no lasting power of attorney waiting to swing into action if the worst happens to you.

Picking your own attorneys can also avoid family arguments about who should act – a disputed Court of Protection application is the stuff of nightmares and your assets may well be funding the whole process.

Many who have heard of lasting powers of attorney tend to think of them as something to assist the elderly, or as a last minute measure to be put in place when someone is taken ill or begins to decline mentally. They work much better and are much less costly to put in place and to operate, if the client embraces the process long before dementia or frailty looms on the horizon. We do not all spend our later years mentally confused or in residential or nursing care, or at the mercy of acquisitive relatives or friends, but some of us do.

If you don’t make a will, then on your death the law imposes the rules of intestacy to sort out who inherits what. If you don’t make a lasting power of attorney, not only can it be a lengthy and expensive for someone to apply to be your deputy to run your finances or make decisions for you, but you will be living with the very real consequences of that for your remaining years.

It is much better to take control yourself, with plenty of time for advice, reflection and discussion, and make a lasting power of attorney to give as much power as you decide to the people you pick and trust to be your attorneys.