When the Mental Capacity Act 2005 (the MCA) came into force in 2007, it changed the law governing powers of attorney. Prior to the change, anyone wishing to make arrangements for their future would put an Enduring Power of Attorney in place. Enduring Powers of Attorney made before 2007 remain valid, but since the MCA came into force, those wishing to make future plans do so with Lasting Powers of Attorney. Here, our specialist power of attorney solicitors explain what powers of attorney are and answer the regularly asked question, ‘What is the difference between lasting and enduring power of attorney?’
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What Is An Enduring Power Of Attorney?
An Enduring Power of Attorney, also known as an EPA, is a document by which someone, known as the donor, gives other people the power to manage their financial affairs if they lose the capacity to do so themselves. When the MCA came into force in October 2007, EPAs were replaced with Lasting Powers of Attorney (LPAs).
What Is A Lasting Power Of Attorney?
Like Enduring Powers of Attorney, Lasting Powers of Attorney, also known as LPAs, enable people to nominate those they trust to manage their affairs if they become unable to do so themselves.
There are two kinds of Lasting Powers of Attorney. A Property and Financial Affairs LPA is similar to an EPA in that it deals with financial matters. The other kind of LPA is a Health and Welfare LPA. As its name suggests, a Health and Welfare LPA deals with decisions relating to the donor’s health and welfare, from personal hygiene to life-saving medical interventions. EPAs did not address health and welfare issues.
What Is The Difference Between Lasting And Enduring Power Of Attorney?
There are several similarities between EPAs and LPAs. They include the following:
- Both EPAs and LPAs enable the donor to choose people they trust to make decisions relating to their finances and property on their behalf.
- All attorneys, whether nominated under an EPA or LPA, are under strict legal duties to act in the best interests of the donor.
However, there are a number of key differences between EPAs and LPAs. They include the following:
- A crucial difference between EPAs and LPAs is that EPAs only deal with financial affairs, such as the donor’s bank accounts, property, and investments. On the other hand, an individual can make two types of LPA: one to deal with their financial affairs and another to deal with their health and wellbeing.
- An EPA is valid as soon as it is signed. These so-called ‘unregistered EPAs’ can be used while the donor retains mental capacity. Once they lose capacity, the EPA must be registered before it can be used. LPAs are not valid until they have been registered with the Office of the Public Guardian.
- The donor can include their preferences on particular issues and give their attorneys guidance on the decision-making process in an LPA. When making an EPA, a donor could not include their preferences, but they could prepare letters of wishes to be read alongside their EPA.
Should I Make A Lasting Power Of Attorney Or An Enduring Power Of Attorney?
When the Mental Capacity Act 2005 came into force in October 2007, anyone wishing to put documentation in place to protect their future decisions must do so with Lasting Powers of Attorney. However, any Enduring Powers of Attorney made before that date remain valid, and thousands of people still have them in place.
I Have An Enduring Power Of Attorney In Place; Should I replace It With A Lasting Power Of Attorney?
You cannot change an existing Enduring Power of Attorney, but you can cancel it and make Lasting Powers of Attorney instead, provided you have the mental capacity to do so.
Lasting Powers of Attorney are preferable to Enduring Powers of Attorney for several reasons. They allow the donor to address issues relating to their health and welfare as opposed to simply their financial affairs. Furthermore, they are more flexible than Enduring Powers of Attorney, and the donor can make their preferences known and provide guidance for their attorneys to follow.
How Can We Help?
If you would like to learn more about Lasting Powers of Attorney or are considering making one to replace your existing Enduring Power of Attorney, our expert power of attorney solicitors are on hand to provide the advice and support you need. With decades of experience in assisting clients to put arrangements in place to protect their future, we are ideally placed to guide you through the process with care and compassion and ensure your powers of attorney accurately reflect your wishes and protect your position.
Reach out to Birch & Co’s specialist and supportive team today. Call us on 0191 284 5030 or complete a Free Online Enquiry now to get a bespoke fixed price estimate.
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