Lasting powers of attorney (LPA) permits the appointed attorney to deal with the donor’s affairs and make certain decisions on behalf of the donor. There are two types of LPA (1) financial and property affairs LPA, and (2) health and welfare LPA.
Scope of LPA
In order to grant an LPA the donor must be over the age of 18 and must have capacity at the time the LPA is executed. A donor may appoint more than one attorney under the same LPA. If more than one attorneys are appointed the attorneys may be required to act together in making certain decisions.
Under the financial and property affairs LPA the attorney can pay the donor’s bills, sell the donor’s property, and operate the donor’s bank accounts. The financial and property affairs LPA can be used even where the donor still has capacity provided the donor does not specify otherwise.
On the other hand, the health and welfare LPA can only be used when the donor loses capacity or the appointed attorney reasonably believes that the donor has lost capacity. Under the health and welfare LPA the attorney can make decisions concerning the donor’s medical treatment, diet, and where the donor lives. The attorney cannot make decisions concerning life-sustaining treatments unless the donor permits the attorney through the LPA.
The donor is able to limit the powers granted to the attorney and express preferences on the LPA. Preferences expressed on the LPA are not strictly binding on the attorney.
Registration of LPA
An LPA must be registered with the Office of the Public Guardian (OPG) before it can be used. An unregistered LPA does not give the attorney any legal authority to make a decision for the donor and acting without registration can expose the attorney to liability.
An attorney will not be liable if the attorney acts within the provisions of a registered LPA that is later discovered to be invalid, unless the attorney was aware that the LPA was invalid or knew of circumstances that terminated their authority under the LPA.
Termination of LPA
A donor is able to revoke an LPA at any time while the donor has capacity — the donor should follow the prescribed procedure and the attorney(s) should be notified of the revocation.
A property and financial affairs LPA will automatically terminate if the donor is made bankrupt or the donor is subject to a debt relief order. The LPA will be suspended but not automatically terminated if there is an interim bankruptcy restrictions order or where the donor is subject to an interim debt relief restrictions order. The suspension of the LPA will last for as long as the order remains in place. The LPA will also terminate when the donor dies.
The appointment of an attorney will be terminated if any of the following events occurs:
- The attorney dies
- The attorney disclaims their appointment
- The attorney becomes bankrupt or subject to a debt relief order
- The attorney is a trust corporation that wound up or dissolved
- The marriage or civil partnership between the donor and the attorney is dissolved or annulled (subject to the provisions of the LPA)
- The attorney loses capacity to act.
If any of the six events mentioned above occurs then the LPA may also terminate unless the attorney affected was appointed jointly rather than jointly and severally and there is no provision in the LPA for a replacement attorney.