The benefits of lasting powers of attorney and how to make one during this crisis

Our article on 7 April 2020, Coronavirus - Family Wealth: Wills, Lasting Powers of Attorney and Estate Planning Update, looked briefly at the challenges facing people wanting to make Lasting Powers of Attorney ('LPAs') when social distancing rules apply.  In this article we consider these issues in more detail along with the benefits of having an LPA in place.

Making an LPA is an important part of financial planning for clients. It is something that we raise with  them when discussing their Wills. Often clients haven't thought about signing an LPA and are pleased to have the discussion about the benefits of signing one. An LPA is a document that allows a person (called the donor) to appoint a person or people (called attorneys) who will make decisions for the donor. The attorney or attorneys can make decisions about the donor's property or health, or both. The donor can have different attorneys for different decisions. Once validly appointed, the attorney or attorneys will be able to make decisions for the donor even if the donor loses the ability to make those decisions for themselves. Once registered, the attorney or attorneys can use the LPA for finance straight away. Decisions about health and care are however only permitted when the donor loses mental capacity to make those decisions for themselves. Vulnerable clients are currently finding that their LPA for finance is particularly helpful because it allows their attorney or attorneys to attend the bank on their behalf or use their own funds to do shopping and other errands for them while they remain safe at home. It should be noted that if the donor owns assets abroad, specific advice needs to be given on whether the donor will need a power of attorney in the country in which the assets are situated. The Hague Convention on the International Protection of Adults ('the Hague Convention') allows certain countries to recognise protective measures put into place by other countries. Although not ratified by the UK, parts of the Hague Convention have been given statutory force by virtue of being incorporated into the Mental Capacity Act 2005 (Schedule 3). If the donor of an LPA has property abroad, bespoke advice must be given on whether that country has ratified the Hague Convention or has put in place other legislation to recognise the legal power of an LPA. In some cases, it is necessary to have powers of attorney in the other country.

How to make a lasting power of attorney

Ordinarily, in order to make an LPA legally valid, the donor needs to sign the document in the presence of an independent adult witness. Next an independent person, called the “certificate provider” must provide a certificate to confirm that the donor understands what they are signing. Then the attorney or attorneys must sign the LPA, also in the presence of an independent adult witness. Lastly, the donor would normally sign the LPA again in order to have it registered with the Office of the Public Guardian ('OPG'). The OPG is an executive agency that is sponsored by the Ministry of Justice and which oversees work required on behalf of people who cannot make decisions for themselves.It is possible for the donor to use the OPG's online service to make the LPA but the donor would still need to print the completed forms for signature and post the signed forms to the OPG.

 Procedure for signature

Someone must watch the donor and the attorneys sign the LPA. The OPG's guidance on making an LPA during the pandemic confirms that LPAs can still be made while observing government guidance on social distancing, self-isolating and shielding. This includes:

• Keeping at least 2 metres away from each other at all times
• Washing hands before and after handling the LPA

Someone who lives with the donor can witness the donor's signature as long as that person

• Is aged 18 or over
• Has mental capacity
• Is not an attorney or replacement attorney on the LPA

Someone the attorney lives with can witness the attorney's signature as long as that person:

• Is aged 18 or over
• Has mental capacity
• Is not the donor of the LPA

The witness must

• Be shown the blank signature and date box before they are signed
• Have a clear view of the person signing the LPA so they can see the signature being made
• Be shown the completed signature and date box immediately afterwards

It is not permitted to witness signatures over video calls. Signatures must be witnessed in person. Prior to the OPG guidance being issued, we had two sets of clients who needed immediate advice on how to have their LPAs witnessed safely. In one case, we acted for a married couple and the husband had been exposed to colleagues who were presenting severe Coronavirus symptoms. He was concerned that he might have the virus and not want to pass on the virus unknowingly to others. In the other, the clients were a couple with a severely disabled child who had been told to remain within their house with their windows closed. They could not expose their household to the virus. We researched the World Health Organisation's guidance on social distancing and formulated a way for our clients to sign their powers of attorney that would not expose the clients or their witnesses to any unnecessary risk. In both cases, the powers of attorney were signed through a closed window on the basis that their witnesses could see them signing the document. They then posted the documents through their letterbox and allowed their witnesses to sign them in their sight. The witnesses were kind enough to return the documents in the post to us so that we could carry on the process, posting the documents to the next named attorneys for signature in the same way. Though this is one solution, it is far from a perfect one.

The current position

Despite calls within the legal profession for the strict witnessing requirements for LPAs to be relaxed during this time, there are no immediate plans to change the law. The main reason for this is a reluctance to relax requirements which have been put in place to protect the vulnerable. There is a belief that having the documents witnessed and certified provides protection for vulnerable adults who might be at risk of undue influence.The OPG has however launched a consultation on the impact that the Coronavirus outbreak is having on the process of making an LPA and is asking legal professionals to describe their experiences.Our view is that the risk to vulnerable clients, by being exposed to someone carrying the virus, currently outweighs the risk of undue influence. Suitable measures should be put in place to allow for electronic witnessing, even if for the short term. It is of huge benefit to many of our clients to have LPAs in place and without having the documents in place, many vulnerable people are not getting the support that they need. 

What are other countries doing?

The provincial government of Ontario, Canada has introduced the Emergency Management and Civil Protection Act, which temporarily permits the virtual witnessing of wills and powers of attorney as a result of the Coronavirus outbreak. Under the emergency order, issued on April 7, the presence of witnesses “may be satisfied by means of audio-visual communication technology” which means “any technology through which the... parties can see, hear and communicate with each other in real time”.Such electronic witnessing would now be entirely in line with a recent Court of Protection case on remote capacity assessments (BP v a local authority and another [2020] EWCOP 22. Though the case relates to an assessment of mental capacity for the purpose of supporting an application to the Court of Protection, the principle that informed the decision of the Court can be applied to the signature of LPAs.In the Court of Protection case, a doctor was required to assess the capacity of an 83 year old man who was deaf and had Alzheimer's disease. The doctor requested to meet the man in person. The Court of Protection held that it had been entirely appropriate to prevent a doctor from attending a care home to conduct a capacity assessment on the man in question in the light of the risk posed, and in circumstances where the care home was COVID-19 free. The Court of Protection referred to its earlier guidance in which it had observed that, for the time being, many, perhaps even most, capacity assessments should be undertaken remotely. It held that creative use of the limited options available could still provide the Court with the information required to determine the question of capacity.That principle can be applied to the witnessing and certifying of LPAs. The function of the witness is to ensure that it is the donor who signs the LPA and not someone else. The function of the certificate provider is to ensure that the donor of the LPA understands what they are signing. This can be achieved via digital means, with some safeguards in place.Wills and powers of attorney signed in Ontario do not usually require a witness to be a legal professional. However to safeguard vulnerable clients and protect against issues of lack of capacity or undue influence, the Ontario's emergency  requires that one of the witnesses must be a licensee under the Law Society Act of Ontario wherever documents are witnessed virtually. Generally therefore a lawyer is required to oversee the process.It is our view that this is an excellent short term solution to the problem and is something that our government should now consider. By these measures, vulnerable clients can be safeguarded, can take suitable advice and can ensure that the legal authority that they need to give their attorneys can be given without any risk of harm to their own safety.

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If you would like to talk through the consequences for your business, please email us and one of our team will get in touch.