Many people will have heard of a Lasting Power of Attorney (LPA). It is a document you can make to appoint individuals to make decisions on your behalf in relation to either your Property and Finances or Health and Welfare. A lesser known term is that of Deputyship. This appointment is similar, in that a Deputy can make decisions and manage the affairs of another person when they have lost mental capacity. A Deputy is appointed by the Court of Protection after a person has lost their mental capacity (or in cases where a person has never had mental capacity).
With dementia cases in the UK rising sharply, the chances of needing someone to make decisions on your behalf is increasing, so it is important to understand your options.
Although the roles of Attorney and Deputy are similar in nature, there are some key administrative differences:
1. Mental capacity
To make an LPA, you must have mental capacity at the time you make the document. You need to understand the concept of handing over responsibility for your affairs to someone of your choice. With an LPA you decide who will be your attorney and make the arrangements yourself. The LPA needs to be registered with the Office of the Public Guardian (‘OPG’) before it can be used.
A application for Deputyship is made by the proposed Deputy who applies to the Court of Protection to be appointed. A Deputyship order can only be made on behalf of another person if they already lack mental capacity. You cannot make an application for Deputyship in advance of someone losing their mental capacity. The person for whom the Deputyship order is being made does not need to consent to the application, but they do need to be notified as part of the legal process.
The key difference is timing. Attorneys are appointed in an LPA before mental capacity is lost. A Deputy is appointed by the courts after mental capacity has been lost.
Under an LPA, you are able to choose anyone over the age of 18 to act on your behalf, so long as they too have mental capacity. You can have multiple Attorneys who can act together or independently.
With a Deputyship order the court will decide whether the person making the application is suitable to act as your Deputy. It is possible the court will appoint someone that you would not actually have chosen yourself to make decisions. In cases where there are no close family able or willing to act, Local Authorities my take on the role of Deputy. Sometimes solicitors or other professionals are selected by the court to act.
Generally a Deputy will only have powers over your Property and Finances. Health and Welfare Deputyships are very strictly limited due to the difficult nature of appointing someone to have free reign over your medical decisions, without knowing what your wishes would be.
An LPA can be written and registered in 8-12 weeks, and will be completed in advance of you losing mental capacity. Once registered, your Attorneys can act for you immediately if required, so there will be no delay in accessing much-needed funds in an urgent situation.
Appointing a Deputy is not a quick process. If you lose mental capacity without an LPA in place, the court application takes around 4-6 months. In the meantime no-one will be able to make decision or access your funds to pay bills or care fees. This can cause problems should you require nursing care or if your proposed Deputy needs to sell property or investments to release funds.
An LPA is significantly cheaper than a Deputyship, with legal fees coming in at around half the cost. In addition, it costs £82 to register an LPA, whereas the court fee alone for making a single Deputyship application is £385. Once a Deputy has been appointed there are also annual supervision fees of approximately £325.
The level of ongoing supervision of a Deputy is very different to an Attorney. There are rigorous controls in place to ensure a Deputy is acting correctly, including the submission of an annual report to the OPG accounting for all expenditure made on your behalf. This can be very difficult and stressful for the person appointed as your Deputy.
In contrast, an Attorney appointed under an LPA is not required to report to the OPG. The court takes the view that you have chosen your Attorneys yourself and they trust that your judgement is correct. In some circumstances the court will investigate an Attorney if they receive a report to suggest that they are acting improperly, but strict ongoing supervision is generally not deemed to be necessary.
Although planning for the worst can be difficult, it is cheaper, quicker and less stressful for all involved if you have made an LPA in advance. However, if an LPA has not been made, all is not lost and a Deputyship application can be made to allow someone to manage your affairs.
There are 850,000 people with dementia in the UK, with one more person developing the illness every three minutes, so the need for LPAs and Deputyship orders has never been so important.
Make sure you have your say about who makes decisions on your behalf. Get in touch with the Wills,Trusts and Probate department at Forrester Sylvester Mackett on 01225 755621 to speak to a member of our team about putting an LPA in place.