Managing other peoples affairs

People sometimes assume that if they are a close relative of someone, are married, in a civil partnership, or living with a partner they will have the right to make important decisions and take over that person’s affairs when they can no longer do it themselves.

Legally this is not always the case and not knowing this can cause a lot of practical problems and emotional distress. There are ways of planning ahead for different situations. Although it can be hard and painful to think about these things, it could save a lot of time and anxiety later.

Choosing how to manage someone’s affairs will depend mainly on the circumstances of the person whose affairs you want to manage, and whether or not they have mental capacity. Once this has been established, the most appropriate options will become more evident.

What is mental capacity?

This is the ability to understand a situation, communicate what you would like to happen and understand the outcome. It could also involve weighing up options and thinking about what is the best thing to do. Some people’s mental capacity will change from day to day and some people will be capable of making simple decisions but may struggle with more complex things.

NHS Choices sets out what is meant by the Mental Capacity Act (MCA).

Ways of managing someone else’s affairs

You can look after someone’s affairs in the following ways:

• letter or a third-party mandate
• appointeeship
• power of attorney
• deputy appointed by the Court of Protection

There are other ways in which the person that you care for can set out their wishes about what they would like to happen concerning their future treatment and well-being.

• Advance Decision
• Advance Statement

Letter or third-party mandate

If the person you care for only needs a bit of help managing their money you could think about a third-party mandate to deal with a bank, building society or other financial account. The bank will provide a document for the account holder to fill in naming a specific person to look after their account (with some restrictions). This is not an appropriate option if the account holder is losing the ability to make relevant decisions themselves.

For example:

When Lilian could no longer get to the bank, she arranged through a third-party mandate for her daughter to withdraw money and pay household bills on her behalf.

Ordinary Power of Attorney

An Ordinary Power of Attorney (OPA) is used whilst someone still has mental capacity and could be used if they go on holiday or are unable to manage their affairs in the short term. The OPA can give a general authority over all their financial affairs or for something specific like the sale of a house. It becomes automatically invalid if the person giving the OPA loses capacity.

For example:

Doug had to go abroad to deal with a family crisis and expected to be away for a long time. He set up an OPA so that his life-long  friend Frank could look after his affairs and manage the sale of his house.

Appointeeship

If the person you care for is unable to understand or deal with their welfare benefits, including their state pension, they will need an appointee. As the main carer, you may be the most suitable person to become the appointee. To set this up you will need to contact the office that pays their benefits. The Department of Work and Pensions (DWP) will usually want to visit you and the person you care for to make sure this is the right thing for both of you.

Becoming an appointee for your child when they reach 16 can also be a bit of a bridge in helping them reach independence. It can allow you to help them learn to manage their own money.

For Example:

Faiza wanted to become an appointee as her son was not ready to manage his Disability Living Allowance when he turned 16. She hoped that gradually, with her support, she would be able to give him more control.

More about becoming an appointee on the government website.

Power of Attorney

Ordinary Power of Attorney

An Ordinary Power of Attorney (OPA) is used whilst someone still has mental capacity and could be used if they go on holiday or are unable to manage their affairs in the short term. The OPA can give general authority over all their financial affairs or for something specific like the sale of a house. It becomes automatically invalid if the person giving the OPA loses capacity.

For example:

Doug had to go abroad to deal with a family crisis and expected to be away for a long time. He set up an OPA so that his lifelong friend Frank could look after his affairs and manage the sale of his house.

Lasting Power of Attorney

A Lasting Power of Attorney (LPA) allows someone (the donor) to choose another person (or persons) to manage their affairs when they are no longer able to do so. To make an LPA, the donor must have what is known as ‘mental capacity’. An LPA puts the authority or the ‘power’ in place in preparation for a time when the donor can no longer make or act on their decisions. In setting up an LPA, a relevant professional such as a solicitor or two people who know the donor well must sign a statement declaring that they believe the donor fully understands the LPA and its implications.

When to set one up

Many people now choose to set up an LPA long before it may be needed. This means that if something unexpected happens it is there ready to be used. It can give peace of mind to think ahead and set one up in advance and it may never be needed. As soon as someone is diagnosed with an illness that could affect capacity, for example, dementia or a mental health illness, it is worth thinking about doing. It will need to be registered before it takes effect.

For example:

Pat was diagnosed with vascular dementia – he noticed small changes in his memory and ability to make decisions and grasp new things. Although he and his family found it upsetting to think about the future they decided to set up an LPA and this saved a lot of stress when Pat’s dementia suddenly got a lot worse. Things were still not easy but at least that was one thing sorted out.

There are two types of Lasting Power of Attorney

• LPA for Financial Decisions
• LPA for Health and Care Decisions

LPA for Financial Decisions

This LPA gives you the power to make decisions about money and property for the person you care for, for example:

• managing a bank or building society account
• paying bills
• collecting benefits or a pension
• selling your home

This type of LPA can be used as soon as it is registered, and the person in need of care and support can still make decisions. They may choose to ‘hand over’ at that point or may want to continue to manage their own affairs as long as they can, knowing that the LPA is set up to be used when necessary.

LPA for Health and Care decisions

This LPA gives the power to make decisions about things like:

• daily routine, eg washing, dressing, eating
• medical care
• moving into a care home
• life-sustaining treatment

It can only be used when someone is unable to make their own decisions.

Will I be the only attorney?

The named person (or persons) to take over the decision-making is called the attorney(s). If the person you care for would like to make you an attorney, they must decide if you will be the only attorney or if there will be more than one. If there is to be more than one, it needs to be made clear whether the attorneys will make decisions separately or together. The person setting up the LPA can limit the decisions that the attorneys can make and may attach conditions. They can ask one attorney to make decisions about one thing and another one to take responsibility for something else.

How do you set up a LPA?

You can apply online or ask for the forms to be posted to you.

It’s not essential to use a solicitor to complete the forms. However, it is an important legal document so many people choose to use a solicitor or other advisor. There would be a cost to this in addition to the registration fee (see below). If you use a solicitor make sure you find out how much it will cost before going ahead.

You might want to look at the LPA forms and read the guidance notes first, and then see if you feel you need legal advice.

Apply online on the government website or contact the Office of the Public Guardian:

Email: customerservices@publicguardian.gsi.gov.uk
Telephone: 0300 456 0300
Textphone: 0115 934 2778
Monday, Tuesday, Thursday, Friday 9 am-5 pm
Wednesday 10 am-5 pm

Find out about call charges on the government website.

What does it cost?

There is a separate charge to register each type of LPA. If a mistake is made in the application form there may be an extra charge to correct it. Some applicants can apply for a reduction or do not have to pay. If someone gets certain means-tested benefits they do not have to pay and if their annual income is under a certain amount they may get a 50% reduction. The government website has information about charges, reductions, exemptions and how to apply.

Enduring Power of Attorney

Some people may have an Enduring Power of Attorney (EPA). It is no longer possible to make a new EPA but if it was made before 1st October 2007, it can still be used or registered. Since 1st October 2007, people have had to make a LPA rather than a EPA.

An EPA can be used without being registered if the cared-for person has mental capacity but if they lose mental capacity it needs to be registered. An EPA only allows someone to make financial decisions for someone else and does not give the right to make decisions involving health and welfare.

You may want to consider ending the EPA and setting up a LPA or you could keep the EPA and just set up a health and welfare LPA if you feel it will be needed.

Deputy appointed by the Court of Protection

If the person you care for no longer has mental capacity and has not got an LPA or an EPA in place you could apply to the Court of Protection to become a deputy. This means that the courts would appoint you to manage the affairs of the person you care for. There are two types of deputyship:

• property and financial affairs
• welfare

The court will only appoint a welfare deputy in certain situations as most care and treatment decisions can be made by those involved in providing care, so long as they are acting in the person’s best interests. It will depend on the situation and whether people agree on the best course of action. The government website has more information about this.

If you want to make a single important decision, you can apply to the Court of Protection for a one-off order. The government website has more information about this.

If the person in need of care just needs help with benefits, they do not need a deputy and you can manage their benefits through becoming an appointee.

Advance Statements

An advance statement is a way of recording someone’s wishes about treatment options and their preferences for care if there comes a time when they can no longer make decisions for themselves. It is an opportunity to record ethical, moral and spiritual beliefs as well as everyday likes and dislikes.

Advance statements are not legally binding but will help to ensure that someone’s wishes, feelings and beliefs are taken into account.

Compassion in Dying has information about advance statements

Advance Decisions (sometimes known as a Living Will or Advance Directive)

An advance decision is legally binding and allows the person that you care for to say which medical treatments they would refuse if they later lose the capacity to make this decision. An advance decision needs to include certain information to be valid and needs to be specific in what it says.

Compassion in Dying has more information about Advance Decisions.

If the person you care for sets up an LPA and already has an advance decision or makes an advance decision after setting up an LPA they need to check how the two may affect one another. The one that is made later will be the legally binding one.

An advance decision will be valid as soon as it is written and witnessed whereas a LPA is only valid once it’s been registered. An LPA has broader powers whilst an advance decision is just about refusing life-sustaining treatments.

Compassion in Dying has more information about the differences between an LPA and an advance decision.