Many of us (or our families or friends) will, at some point, become unable to make a decision, whether through dementia, mental illness, the effects of a disease or an accident.
What happens if we become unable to make a decision for ourselves? How can we make sure that the right people can make decisions for us?
By taking steps whilst we are well enough, we can choose who can make decisions for us. This can help make sure that decisions made are what we would have wanted.
Lasting Powers of Attorney
A Lasting Power of Attorney (“LPA”) is a legal document in which you appoint people of your choice (your attorneys) to make decisions on your behalf.
There are two types:
- Property and Financial Affairs LPAs allow your attorneys to, for example, deal with banks, sell and buy property and investments, and pay bills. They are usually used when the person making the LPA has become physically or mentally unable to manage their affairs.
- Health and Welfare LPAs allow your attorneys to make decisions about medical treatment and other personal welfare issues, such as where you live, but only once you have lost the ability to make such decisions for yourself.
Both types need to be made whilst you still have mental capacity and they both need to be registered with the Office of the Public Guardian before they can be used.
A case study – Alice and George
Our case study illustrates the possible scenarios that people wo lose capacity can find themselves in.
Alice and George are neighbours. Both suffer from dementia and can make very few decisions for themselves. It is clear that they can no longer care for themselves. How are they to be looked after, and how can their families access their assets to pay for the costs of care?
Making decisions about personal welfare
Alice has made a Health and Welfare LPA, so that her children can make decisions about medical treatment and other personal welfare issues. This means that her children have legal authority to decide where she should live and what care she should receive. Alice has always wanted to receive care at home, rather than go to live in a care home.
Because she has made a Health and Welfare LPA, her children have the legal power to decide that she should continue to live at home and receive care there.
George, on the other hand, has not made a Health and Welfare LPA, so decisions about where he will live and the care he receives will be made by professionals. Like Alice, he always wanted to continue living at home, and to be cared for there, but because he has not made a Health and Welfare LPA, the decision about where he lives is made by his social worker. The social worker has a duty to consult with other people, and to take into account what George wants, but he has never met George before, and is not sympathetic to the idea of George being cared for at home.
The outcome is that George goes to live in a care home.
Dealing with finances
Once the arrangements for Alice and George’s ongoing care are put in place, each family needs to arrange payment of care costs.
Alice has made a Property and Financial Affairs LPA, authorising her children to deal with financial matters for her. Her children can access her investments, savings and pensions straightaway and pay her care fees and living expenses.
George has not made a Property and Financial Affairs LPA, and is no longer well enough to make one. His family finds that his bank has frozen his accounts, so that they can’t access his pension. They cannot sell the house or deal with his investments. George’s daughter has to apply to the Court of Protection to be appointed as his deputy so that she can access his money and investments to pay bills, and sell the house. She finds the application process expensive and a real headache – even though she has help from solicitors, she has to gather together a lot of detailed information. The whole process takes six months at a time that is already very upsetting for her. She also has to prepare annual reports for the Office of the Public Guardian, which is time consuming.
Why make an LPA?
- Making an LPA is in some ways similar to taking out an insurance policy. We take out insurance in the hope that it will never be used, and for most people this applies to LPAs. If we do need to make an insurance claim, or become unable to make decisions for ourselves, the money spent on insurance premiums or on an LPA is a fraction of what we would otherwise have to spend. For example, it typically costs between £650 and £950 to make an LPA, whereas if someone has to apply to the Court of Protection, the initial costs can easily come to £4,000 or more, with additional costs for each year after.
- Making an LPA means that you choose who makes decisions for you, if you can’t make those decisions for yourself. If a doctor or a social worker has to make decisions for you, you don’t know in advance who that doctor or social worker will be. There is a real risk that a decision made by a professional will not be what you or your family would have wanted.
If you would like to discuss this article, or any other matters relating to care in the home, please ring our Client Advisory team on 01728 605107 or email firstname.lastname@example.org
This article was prepared by Caroline Pinney, a senior solicitor at Mills & Reeve. To discuss any of the issues raised please contact Caroline:
Tel: 0161 234 8825