Powers of Attorney have been in existence for many years. By using a Power of Attorney, a person (the Donor) gives authority to someone else (the Attorney) to act on his behalf and manage his or her affairs. Although a Power of Attorney might be limited to some specific matter, for example to sign a contract or transfer deed while the Donor is abroad, it can give the Attorney the widest powers over the Donor’s affairs.
There has been a popular misconception that a Power of Attorney could continue to be used even after the Donor becomes mentally incapable. Unfortunately this is not the case, as once the Donor becomes mentally incapable, the Attorney can no longer act. This means that an application to the High Court (Office of Care and Protection) is required for the appointment of a Controller to take the place of the Attorney. This can result in considerable delay and expense to the Donor, as well as the continuing involvement of the Office of Care and Protection in the Donor’s affairs, usually for the rest of the Donor’s life should their mental incapacity continue until their death.
We recommend that wherever a Power of Attorney is required, it should be an Enduring Power and not a general Power of Attorney. The objective of an Enduring Power of Attorney is to enable the Donor to decide who they would like to deal with their affairs, even after they become mentally incapable. We take the view that the choice of Attorney is all-important and the Donor should choose someone whom they can trust to look after their affairs even after they are no longer capable of doing so themselves.
As soon as the Attorney is aware that the Donor is or is becoming mentally incapable, the Attorney is under a duty to apply to the Office of Care and Protection to register the Enduring Power of Attorney. The registration process consists of the Attorney giving notice of the intended registration to the Donor and to certain near relatives of the Donor to enable any of those persons to make an objection to the Court to the registration. Assuming that no valid objection to registration is received, the Office of Care and Protection will then register the Enduring Power of Attorney, usually after 6 weeks of receipt of the application.
There has been no change to Enduring Powers of Attorney in Northern Ireland since 1987. However, new mental capacity legislation, the Mental Capacity Act (Northern Ireland) 2016 was passed by the NI Assembly and received Royal Assent in May 2016 but has not yet been implemented. The new Act proposes to bring Northern Ireland into line with England and Wales, where Enduring Powers of Attorney were replaced with new Lasting Powers of Attorney in 2007.
Lasting Powers of Attorney are more wide ranging than Enduring Powers of Attorney as it will be possible to have a Lasting Power for healthcare, treatment and welfare decisions as well as for property and financial affairs as before. It is anticipated that, as and when the new Act is fully implemented, it will only be possible to create Lasting Powers of Attorney, however any Enduring Powers of Attorney created before that time will remain valid, as has been the situation in England and Wales since 2007. However, much remains to be seen and we would therefore recommend making an Enduring Power of Attorney now whilst they remain available. For further information, please contact Brid McColgan on 02890 553300 or email brid.mccolgan@tughans.com
Note: These notes are intended as guidance for clients and must only be relied on in conjunction with specific advice given in each individual case.
While great care has been taken in the preparation of the content of this article, it does not purport to be a comprehensive statement of the relevant law and full professional advice should be taken before any action is taken in reliance on any item covered.
