Power of Attorney is the granting of legal authority to a third party to make decisions on the grantors behalf in the event they temporarily or permanently lose mental capacity to make their own decisions or communicate their decisions. Examples of Power of Attorney are where a Living Will is established by a person anticipating terminal illness and Power of Attorney is handed over to a trusted family member. A further example is where an individual is receiving treatment in hospital for a prolonged period of time.
Definition of mental capacity
A person lacks mental capacity where they cannot understand the decision they are making or the implications of it. Where Power of Attorney is concerned, these most commonly concern finances and healthcare decisions. Depending on whether or not mental capacity is temporary or permanent determines whether ordinary Power of Attorney or Lasting Power of Attorney (LPA) is needed.
Lasting Power of Attorney (LPA)
An ordinary Power of Attorney is appropriate where a person is temporarily without capacity, such as going through an operation or procedure in hospital.
If capacity is anticipated to be permanently lost, due to illness or age, an LPA establishes Power of Attorney on a permanent basis. It must be noted that the person must have capacity to enter into the LPA in the first place.
An LPA for financial affairs will normally cover the purchase and sale of property, settlement of mortgages and debts and maintaining property.
Where an individual anticipates becoming terminally ill or is undergoing risky medical treatment, they may wish to make a Living Will that expresses their wishes as how to be cared for if they are no longer able to indicate their preferences, known as advance statements, or in some cases they may wish that life support not be administered through a legally binding advance declaration. Power of Attorney will normally be granted to a trusted family member who makes sure the preferences of the Will are adhered to.
It is important to note that advance decisions and statements can only relate to financial matters and healthcare decisions when the testator is still living. It cannot relate to distribution of an individual's estate upon death.
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