Forward Thinking

What happens if an accident or illness prevents you from managing your own affairs? Michael McGarry explains why you should consider taking precautions.

Michael McGarry began legal practice in Hawes in 1997 and established McGarry & Co Solicitors in Barnard Castle in 2011. The business expanded rapidly, and now has additional offices in Hawes, Leyburn, Skipton, Sedbergh and Darlington.

Life is unpredictable, and there are many reasons why a person might become unable to manage their own affairs. Some conditions, such as dementia, are gradual in onset and may be irreversible. Other changes or illnesses can be sudden but temporary, such as an accident or a mild stroke.

Regardless of the cause and the likely outlook, if a person lacks the mental capacity to take important decisions then, unless arrangements have been made in advance, nobody has the automatic right to take charge of their affairs, explains Michael.

“Contrary to what people often assume, being married or in a relationship or having children doesn’t entitle anyone to act on your behalf. This can put relatives in a difficult position. Utility bills or local authority care home fees may fall due; pensions or other benefits may need to be collected; businesses or investments might urgently need to be managed, or property sold.

“If no prior arrangements are in place, your relatives’ only options are to struggle along as best they can or to apply to the Court of Protection for a Deputy to be appointed to make decisions on your behalf. This is a slow and costly process – you can be waiting for up to a year – and it could even result in a family dispute if your relatives can’t agree who the deputy should be.

“As well as decisions about your property and financial affairs, there may well be crucial decisions to be made about your health and welfare. What kind of medical treatment should you receive? Where should you live? In the event that you need to go into a nursing or care home, which one should it be?”

A Sensible Solution

Fortunately, there’s a way of forestalling these problems, namely to set up a Lasting Power of Attorney (LPA).

“An LPA involves appointing one or more individuals that you trust to act as attorneys to look after your affairs if you lose the mental capacity to do so yourself. When dealing with finances, there is also an option for the LPA to come into effect straight away. It’s important to think ahead, because once you lose capacity it’s too late to set up an LPA – it needs to be done in advance. Of course, it may never be needed, but like insurance it’s definitely worth having in place just in case.

“There are two kinds of LPA. A Property and Financial Affairs LPA gives your attorney the power to make decisions about your money and property, and a Health and Welfare LPA enables your attorney to make decisions about issues such as how and where you live and what kind of medical care you receive. Most people get both LPAs done together, often at the same time that they are making their wills.”

“The attorney could be a relative, a friend or solicitor. You can appoint different attorneys for each type of LPA, and you can also appoint a succession of attorneys. For example, you might appoint your wife as attorney, and one of your children to be attorney in the event that your spouse predeceases you or no longer has the capacity to act as attorney when required.”

“It’s possible to apply for an LPA online, but if you talk to a solicitor, we can give you a full explanation of how LPAs operate and how to avoid the pitfalls. For example, we can help you fine tune the circumstances in which the LPA can be applied, and what exactly your attorney should or shouldn’t do. We can also help to ensure your interests are protected, for example by building in provisions that reduce the opportunities for anyone to commit fraud or exert undue influence.

“Arranging a single LPA is likely to cost around £400 plus VAT, and arranging two – a Property and Financial Affairs LPA and a Health and Welfare LPA – will be around £600 plus VAT. In addition to this the Office of the Public Guardian will charge £82 per LPA registered. It’s not cheap, but then the consequences of not having an LPA in place could prove very costly in the long run.

“Drawing up an LPA with your solicitor is relatively quick and easy, but at the moment it’s taking around five months for the Office of the Public Guardian to register LPAs, so if you’re thinking of doing it then it’s definitely better to take action sooner rather than later.”

For branch details, contact numbers and more information about McGarry & Co Solicitors visit mbmcgarry.co.uk