LPAs in Lockdown10 Jun 2020 // Insights
Private Client Solicitor Natasha Southam considers the benefit of making Lasting Powers of Attorney and how to adhere to Government guidelines.
The arrival of Covid-19 in our lives and the associated uncertainty around many people’s health and finances has undoubtedly focused the mind on what can be done to ensure one’s affairs are in order, both for yourself and those closest to you. Unprecedented times like these highlight the need to protect against life’s uncertainties, and the extent to which vulnerable individuals and the elderly are more at risk of financial abuse and neglect if these protections are not in place.
The Society for Trust and Estate Practitioners (“STEP”) recently published the results of a survey showing that, despite the current pandemic, the number of LPAs being made has only increased by a small percentage for some professionals, and others have even seen a decline in the number of LPAs being made. This is concerning given that the current situation highlights for many the need to have adequate protections in place, not just for oneself but for one’s vulnerable loved ones.
People may be concerned about how they can make an LPA whilst adhering to the social distancing measures. However, it is certainly possible to do so as outlined in this article.
Of course, some of the people most in need of an LPA may also be self-isolating. The self-isolation and social distancing rules could leave the elderly and incapacitated more vulnerable to financial abuse if the correct protective measures are not in place.
What are LPAs and how does having one in place help me?
LPAs can be made in respect of a person’s property and financial affairs and, separately, their health and welfare. They are legal documents which permit the donor to appoint an attorney (or attorneys) to act on their behalf if they are unable to make decisions themselves. This could be, for example, if the donor is unwell, unable to leave their home, or undergoing treatment in hospital.
LPAs are the best means of ensuring that the donor’s wishes are followed in the event of incapacity and act as a protection from potential financial abuse. They enable the donor to appoint individuals the donor trusts implicitly to manage their personal affairs and to make decisions for them. Financial Decisions LPAs can be used by the attorney either immediately with the donor’s consent or only when the donor has lost mental capacity. Health and Care Decisions LPAs can only be used by the attorney when the donor has lost mental capacity; such is the personal nature of decisions about one’s health matters.
A separate LPA can also be made for a donor’s business, to ensure that the correct individuals are appointed to allow for business continuity whilst the donor is incapacitated. This would normally be more relevant to sole traders or small businesses which are very much reliant on certain individuals running them effectively and where there are no shareholder agreements or similar in place to set out what should happen in their unavoidable absence.
Once the LPAs have been fully signed, dated and witnessed, they need to be registered at the Office of the Public Guardian (“OPG”).
LPA signature requirements
Despite these unprecedented circumstances, it is vital to obtain specialist advice and follow the formalities to ensure that the LPAs are valid and that the donor’s wishes can be fully implemented.
LPAs are deeds and must be signed in accordance with section 2 of the Law of Property (Miscellaneous Provisions) Act 1989, whereby the donor and all appointed attorneys must sign in writing and in the presence of one independent witness, who must be over 18 years of age. There is also a strict order of signing which must be adhered to.
The OPG will reject applications to register LPAs if these formalities are not strictly adhered to, wasting both time and fees. If the LPAs are needed urgently then this can prevent the donor’s wishes from being followed. It can also prevent those closest to them from being able to make the final decision, which is particularly important when it comes down to making difficult decisions about life support.
It is now possible to use an electronic signature to execute certain documents (including commercial contracts and deeds) provided that the signatory of the document intends to authenticate the document and that any specific formalities relating to execution of that document are satisfied.
However, this is not possible in the case of LPAs, where wet-ink signatures are required for valid execution.
The main requirement is that the donor and the attorneys sign in the presence of a witness. In these times of self-isolation, this requirement is, of course, trickier to adhere to than usual. However, there are still options available to ensure that LPAs can be validly executed.
The witnesses do not need to be the same for the donor and the attorney(s). The important thing is that the witnesses are completely independent, have mental capacity and are over the age of 18. It may well be possible to call on your neighbours, or perhaps nearby colleagues and/or friends, to act as your independent witness and there are a few options available to enable valid execution of the LPAs in this case.
The donor/attorney and the chosen witness can sign on either side of a window or a glass door. The donor’s/attorney(s) signature can be clearly witnessed before being passed through the window or letterbox for the witness to sign in their presence.
An alternative option is for the LPA, or LPAs, to be laid out on a surface in a garden or in a driveway, or passed over a fence, for example. The donor or attorney, and their chosen witness should position themselves at least two metres apart from one another and then take turns to sign the requisite signature pages with the other party watching.
All parties must wash their hands before and after the signing process. You may also wish to use different pens to reduce the risk of cross-contamination.
A certificate provider is also required when making an LPA. Individuals who have known the donor for at least two years can act as a certificate provider or it can be a legal or medical professional.
Their signature does not need to be in the presence of the donor. However, they must certify that the donor understands the contents of the LPAs and the powers that they are conferring on their attorneys.
In most circumstances, it is best practice for the certificate provider to have a physical meeting with the donor to confirm these points. In the current climate, video calls may be an appropriate alternative in most circumstances. However, more stringent measures and / or specialist advice does need to be taken if there are any questions over a donor’s capacity.
The Private Client team at Seddons continues to operate as normal and the team is here to listen, advise and prepare your LPAs for you in line with your instructions.
We are all working remotely and can arrange to speak to our clients, over the telephone or via video call, so that we can clearly understand their wishes, intentions and objectives. Instructions can be taken via Facetime or a preferred video conferencing app and we are maintaining contact with our clients to provide advice via these means and alongside the normal telephone and email contact.
In the case of LPAs, we take particular care to ensure that there is no third-party pressure into making decisions which do not reflect the donor’s wishes. We also have a network of trusted and specialist capacity assessors who can conduct video mental capacity assessments where this is appropriate.
The OPG is still operating as normal and states that it is currently adhering to its 40-day turnout around times. However, this may of course be subject to change as the pandemic develops.
The information provided in this article is for general guidance purposes only and you should always take professional legal advice before preparing and signing your LPAs to ensure that they are validly signed and witnessed.
If you have any questions regarding this article or any other matter relating to your personal affairs, please get in touch with your existing Seddons’ Private Client contact or the Head of the Private Client team, Stuart Crippin, at email@example.com, or on 020 7725 8056.