A lasting power of attorney is a document that allows you to appoint a person – known as an attorney – to make decisions on your behalf.
You can make lasting power of attorney, also known as LPAs, relating to your property and finances and/or your health and care decisions.
LPAs are important to ensure continuity in the management of your life and finances in the event that you were to lose your capacity or become so unwell that you cannot make decisions for yourself.
If an individual loses capacity and does not have an LPA in place, an application can be made to the Court of Protection for a deputy to act.
Applications take on average six to seven months and problems can result because there is no one who can lawfully make financial decisions on the individual’s behalf and bank accounts could be frozen until a deputy is appointed.
If you own a business, you may wish to consider putting in place a business LPA to ensure that someone you trust will be able to act on your behalf to ensure that your business can run as smoothly as possible if you were unable to make decisions.
Without a business LPA your business may not be able to pay staff, suppliers, complete unfinished transactions or enter into new contracts.
This will obviously affect the day-to-day running of the business and potentially threaten its existence.
This can apply even where bank accounts are jointly held in the name of business partners or directors. It may also affect insurance cover and future claims.
With a business LPA in place, your attorneys can deal with property owned or leased by the business, organise insurance, access bank accounts, invest assets, deal with tax affairs, pay staff and suppliers and much more.
It may be possible to have the one LPA appointing attorneys to manage your personal assets and your business assets.
However, this will not always be the case.
Commercial legislation and practices, financial regulatory bodies or the partnership agreement or articles of association of a business may prevent this.
It may also not be appropriate for the same person to make personal and financial decisions for an individual and the business because of a conflict of interest. It is therefore often recommended to have a personal and a business LPA.
At Burnetts we can offer advice and guidance to those thinking of creating lasting powers of attorney.
Contact one of our specialists and we will be happy to guide you through the process.
