19 September 2019
What are the dangers of waiting until old age to set up a Power of Attorney?
It is common for families to struggle when dealing with a relative’s financial affairs whom has lost their mental capacity. If a bank become aware that one of the holders of a joint bank account has lost capacity, they can freeze the account to protect the vulnerable person until someone produces authority to act on their behalf.
Unfortunately, many people put off making powers of attorney, as they think that they will deal with it later or that they will do it when they are older when they think the risk shall be greater. However, often people do not get around to doing it and it leaves their relatives in difficult situation when having to try to access their assets in order to cover expenses, or they have to pay for them from their own funds.
We would always recommend asking a solicitor to assist in the preparation of a power of attorney, as they will be able to provide advice as to whom you should appoint as your attorneys and whether they should be appointed on a joint basis or whether they would be able to act independently of each other, whether there are instructions which need to be included in the document for the attorneys to follow, and also to act as a certificate provider in confirming that the person creating the document has sufficient mental capacity in order to do so. We can also ensure that the correct order is followed in terms of signing the document as there is a strict order that must be followed by the donor and their attorneys.
The more costly alternative to a Power of Attorney, if someone has lost mental capacity, is for relatives to apply to the Court of Protection for a deputyship order, which will appoint identified persons to be their deputy. The process for doing so is very involved and the court require a lot of information to be provided to them in order to accept the application and they will continue to supervise the deputies throughout their deputyship. The costs for applying for a deputyship order far exceed those for preparing a power of attorney and there are continuing supervision fees that are required to be paid.