A chance to hear the latest on employment, property, corporate and restructuring and insolvency and to ask questions and share your opinions.
DATE: Thursday 7 May 2020, 10:00am - 11:00am- delivered via Zoom Video Conference
Search site
Contact our office
Make an enquiry
In recent years there has been a significant increase in the number of people being taken to court for abusing their position of trust as someone’s attorney under a Lasting Power of Attorney (or an old style Enduring Power of Attorney) or failing to act in the best interests of the donor of the power. There have been 721 applications to censure or remove attorneys in the last year, compared with 465 the year before and 250 in 2017. Rather depressingly, the majority of cases of financial abuse involve family members.
A Lasting Power of Attorney (“LPA”) is a legal document that gives authority to act on another’s behalf if the donor of the power (the person granting the LPA) loses mental capacity through illness or accident.
The Mental Capacity Act 2005 (“MCA 2005”) sets out the principles which attorneys must observe if they have to make a decision about money, property, health or welfare on behalf of someone who is unable to make the decision for themselves. The overriding principle of the MCA 2005 is that attorneys must always act in the donor’s best interests.
The most common abuses by attorneys involve making improper gifts without the vulnerable person’s fully informed and independent consent (or the court’s consent – see below) or not acting in their best interests.
The LPA arrangement does have its benefits and is something that we recommend every adult puts in place to cover the possibility of them experiencing a life-changing event which leaves them incapable of making decisions for themselves, permanently or temporarily. However, very careful thought should be given to who you name as your attorney(s). Attorneys have, in theory, the power to make any decision that the donor could have made, and so from a financial perspective, attorneys could have unrestricted access to all of your money and investments. Internet banking might mean that there is very little oversight of the attorneys’ actions unless and until someone else raises the alarm.
If you name a child or children as your attorneys, or just one person as your attorney, you should feel wholly confident that they will always put your own needs first until the end of your life and not regard spending money on you as spending their inheritance. We would strongly recommend that you discuss your options for setting up the power of attorney arrangement with someone independent of your family who can help you to work out the best arrangement, and choice of attorneys, to ensure that your needs will come first. We can discuss your options for including checks and balances in the LPA arrangement.
If you are an attorney and likely to have to make decisions, you must familiarise yourself with the principles of the MCA 2005 and the Code of Practice which can be found on the gov.uk website. Doing so will help to ensure that you respect the donor’s decision-making independence and that you do not abuse your position.
Attorneys should always be ready to demonstrate how they reached their decisions and their adherence to the five principles of the MCA 2005, even if they are never asked to. If anyone has concerns about how an attorney is fulfilling their duty towards the donor, they could contact the Office of the Public Guardian and/or the police and ask them to investigate the matter further.
Attorneys must always keep their own money and the donor’s separate and keep clear and detailed accounts of expenditure incurred on the donor’s behalf both during their lifetime and after their death.
If an attorney wishes to use the donor’s money to make gifts, they must be aware that gifts by attorneys are very restricted by the MCA 2005 and detailed guidance can be found on the gov.uk website. Minor gifts to close family or friends for birthday or Christmas are allowed if the LPA authorises it. For all other gifts, or using the donor’s money to support someone other than the donor, attorneys are not authorised to do this unless the expenditure is permitted within the MCA 2005 or until the Court of Protection has made an order authorising it. Examples of expenditure requiring authorisation would include Inheritance Tax planning gifts, paying grandchildren’s university fees or using the donor’s money to make adaptations to your property for a “granny annexe”.
If you are an attorney and would like guidance in relation to particular decisions or to better understand your role and responsibilities, please contact Caroline Farmer or another member of the Private Client team. We can also assist with applications to the Court of Protection for attorneys or in circumstances where someone has lost capacity but does not have an LPA in place.
A chance to hear the latest on employment, property, corporate and restructuring and insolvency and to ask questions and share your opinions.
DATE: Thursday 7 May 2020, 10:00am - 11:00am- delivered via Zoom Video Conference
Cheltenham based solicitors, Hughes Paddison, have announced two promotions within their Senior Management Team. Jon Rathbone has been made an Equity Director within the firm, whilst Julie Bennett has been made a Director.
What our clients say
“Hughes Paddison have provided assistance on numerous occasions consistently acting in an exemplary fashion whilst dealing with all aspects of the issue at hand. It is extremely reassuring to know that our company is represented by such a competent and professional firm.”– Commercial Director, Ferroli Limited
“We are lucky to have the services of Paul Engelbrecht on hand. He has always met our requests and ridiculous deadlines and puts himself out to make life easier for us”– Company Secretary - Supergroup PLC
“Paul has repeatedly demonstrated a high level of legal skill, accuracy, attentiveness and most of all, commercial acumen. I particularly appreciate his eye for detail and ability to take complex legal issues and explain them in lay terms. ”– Relationship Director RBS
“Whilst constantly demonstrating his consummate professionalism and occasional wry sense of humour David has at all times supported me and acted in my best interests resulting in a successful financial settlement and my divorce.”– V
“Jennifer provided sound professional legal advice which I needed to help me to sort out the legal and financial aspects of a difficult personal situation. I wouldn't hesitate to go to her with any family legal matters I have in future.”– R
“Having the support of Marcus throughout what has been a very painful divorce has really helped me get through the last 18 months. Although this has personally been a very difficult process, I know that Marcus has done everything possible to make it as smooth as it can be. I really appreciate the honest, open feedback to all of my questions and also how quickly he responded to them. Above all else, Marcus really does seem to care about his clients and their families. I never had the feeling that this was just a job for Marcus, and Im so grateful that I was fortunate enough to have had Marcus recommended to me when I did.”– R
Clicking the Accept All button means you are accepting analytics and third-party cookies (check the full list). We use cookies to optimise site functionality and give you the best possible experience. To control which cookies are set, click Settings.
Our use of cookies.
You can learn more detailed information in our Privacy Policy
Some cookies are essential, whilst others help us improve your experience by providing insights into how the site is being used. The technology to maintain this privacy management relies on cookie identifiers. Removing or resetting your browser cookies will reset these preferences.
Essential Cookies
These cookies enable core website functionality, and can only be disabled by changing your browser preferences.
Google Analytics cookies help us to understand your experience of the website and do not store any personal data. Click here for a full list of Google Analytics cookies used on this site.
Third-Party cookies are set by our partners and help us to improve your experience of the website. Click here for a full list of third-party plugins used on this site.