What are the three different types of Power of Attorney?
The future can be unpredictable. None of us like to imagine a situation in which we lose mental capacity to make important decisions for ourselves.
Unfortunately, this is something that could happen to any of us at any time. Having a Lasting Power of Attorney (LPA) in place before such a time, provides a safety net for you and your family. Here we outline the three different types of LPA available, depending on your situation.
Key Takeaways
- There are three different types of LPAs depending on your situation, a Lasting Power of Attorney (LPA), an Enduring Power of Attorney (EPA) and an Ordinary Power of Attorney (OPA).
- LPAs are the most common, and cover property and financial affairs and health and welfare matters.
- EPAs stopped being provided in 2007, as they only cover financial affairs. If you still have an EPA, you may wish to contact a solicitor to change to an LPA to cover your property and welfare.
- An OPA, differs as it is only activated for a limited time in a case other than loss of mental capacity, e.g. going into hospital for an extended stay, or you may be out of the country and difficult to contact.
There are three types of ‘Power of Attorney’;
- Lasting Power of Attorney (LPA)
- Enduring Power of Attorney (EPA)
- Ordinary Power of Attorney (OPA).
Lasting Power of Attorney
A Lasting Power of Attorney is the most common and is something everyone should have in place. Alternatively, it may be that a person does not either have the physical ability to deal with their affairs or that they simply wish for someone else to deal with matters for them. An LPA can be activated when someone has lost mental capacity to make important and informed decisions regarding their financial affairs or healthcare.
The most common reason for this is dementia, such as Alzheimer’s Disease, but you may also have suffered an accident or illness that causes brain damage or have developed a serious mental illness. Other conditions such as addiction (e.g. alcohol, substances, gambling) may be judged severe enough that someone would be unable to make rational decisions.
There are two types of LPA:
- Property and Financial Affairs — This involves managing all aspects of your financial affairs, such as paying bills, collecting income, managing investments, and buying, selling, and managing property. There may be limits put on the Attorney’s powers — for instance, specifying that your family home must not be sold. You can elect to activate this LPA while you still have mental capacity, if you choose. We will guide you through these choices.
- Health and Welfare — This involves managing aspects like your living arrangements (e.g. whether you live at home or in a care home), your medical care and your diet. Again, you can specify certain things when setting up the LPA, such as whether you would want certain types of medical intervention.
We will guide you through who you would like to appoint as attorneys and the most appropriate way for them to act.
The importance of a Lasting Power of Attorney is that it is made whilst the Donor has mental capacity. If the person has lost capacity prior to making a LPA then a different route needs to be taken. This can prove to be complicated, time-consuming and more expensive.
You can appoint anyone to the role of an Attorney, as long as:
- they are over eighteen.
- they have mental capacity.
- they agree to take on the role.
In practice, it should obviously be someone you trust — normally a partner, family member or close friend. You also have the option of appointing a professional, such as a solicitor or an accountant. This is sometimes advisable if your affairs are complex. We will take you through all the steps in your deliberations. You can find out more about how to apply for an LPA in our dedicated article.
Enduring Power of Attorney
An Enduring Power of Attorney is an obsolete forerunner to the LPA. Currently, no EPAs are created, but if you have one that was set up before 2007, it is still valid.
An EPA only covers financial affairs, so we would recommend replacing it with an LPA, to include health and welfare. If you do retain your EPA, however, your Attorney will need to register it with the Office of the Public Guardian (OPG) before it can be used in the case of loss of mental capacity.
Ordinary Power of Attorney
An Ordinary Power of Attorney differs from an LPA or EPA in that it is usually activated for a limited time in a case other than loss of mental capacity. Because of this, it is only for financial affairs.
The most common reason you would need an OPA is if you are unlikely to be available for decision-making over a substantial period. For instance, you may be going into hospital for an extended stay, or you may be out of the country and difficult to contact.
Like LPAs, you must use specific types of wording, to set up an OPA or the document will be invalid. It is essential to use a solicitor. As with an LPA, make sure your Attorney fulfils the requirements and agrees to undertake the role.
Using a Solicitor for Your Power of Attorney
Whether you are setting up a Lasting Power of Attorney or an Ordinary Power of Attorney, every requirement must be carefully followed.
Our Lasting Power of Attorney team have a long and successful track record of helping our clients.
Contact our friendly expert team for more information and to find out how you can begin the steps to set up your LPA.
