Enduring Powers. Good Idea? Bad Idea? You Decide.
This week I am thinking about Enduring Powers of Attorney. Are they a good idea?
The point, as they are intended, is that creating a power of attorney will enable another person you know and trust to look after you both physically and financially if a time should come when you are unable to care for yourself.
So most people think these are documents to be prepared in old age, when you are old and doddery but still with few marbles left.
But the expression is, – if you want to make God laugh, make plans.
So anyone who thinks that they have a good fifty years left before they need to think about making an Enduring power of attorney has never heard of road traffic accidents, brain damaging strokes, early onset dementia – and knows that they will for ever continue to enjoy playing Rugby or skiing off-piste with all the benefits of a charmed life immune from disaster.
That being nonsense, right there is the argument for making an Enduring Power of Attorney today, however old you are.
So do it today, yes?
Or, on the other hand, not?
You may have seen the remarks of the senior judge of the Court of Protection Denzil Lush, the subject of my earlier Blog – Link Here- who surprised many last year when he said that he personally would never give an Enduring Power of Attorney to anyone.
His reasoning was, in my translation, – if you choose your best mate or near relative to be your Attorney when you need one, you are doing so in many cases perhaps too thoughtlessly.
“Will you look after me if I need a carer?” is a question inviting the answer –”Yes, We’re mates, of course I will”. Same with “If you win the lottery will you send a few hundred thousand pounds my way?” – “Course I would mate”.
Perhaps the realities of either question are not really being considered. In neither case is the likelihood of winning the lottery, or going into a severe decline, actually taken too seriously.
So when the Attorney is needed to start actually caring maybe ten years after the Deed was signed -– s/he might be a senior Director of a Business two hundred miles away with a busy life, their own kids and family to care for. They may feel honour bound to try to do the job, but they may no longer be the right person. And yet if the Power of Attorney has named them, the Court of Protection will feel its hands are tied, and will appoint them as Guardian because that is what the Grantor – who is now “the Patient” wrote down.
Or worse, just as a newly lottery-enriched millionaire may now feel that perhaps the thoughtless promise to share the win was, with hindsight over-generous, so the appointed Attorney may find that with hindsight the thoughtless promise to help out is a source of regret or even resentment.
What Judge Lush is saying I think, is that he would back the Court of Protection nine times out of ten, to appoint a more appropriate Guardian at the time care is actually needed, against the choice made by an actual patient before disaster struck.
And a perusal of the decisions of the Court of Protection certainly show that our society is not entirely made up by selfless saints.
Here is one – Link Here- the dry unemotional words of the Court report spell out the shocking facts very clearly. “He begrudges her even having her hair tinted”. Nice.
If you like your news more tabloid, here –Link Here- is the newspaper coverage.
So here we have a son who is basically thinking, the patient (my Mummy, she used to be) is a vegetable, why is she hanging on to life and incurring nursing home fees when I could be the owner of all of her money.
So he has decided to help himself to as much of her money as he can get his hands on.
One point which this report does seem to make is that an Enduring Attorney must look after the finances of the patient properly. So in this case, Martin was not entitled to pocket assets from the estate of his mother, who needed every penny to provide for her care.
But having said that, the duty of the Attorney is to act in the best interests of the Patient overall and not necessarily so far as possible to keep her money in the Bank.
Many people appear to have been surprised that in another case, the Court has allowed an Attorney to pay himself Six Million pounds of his mother’s money. The case report is here –Link Here-
The facts seem surprising at first glance only I think.
In the first case the lady’s total estate was worth well under £325,000.00 and if the patient lived for eight years more there would be nothing left to pay her nursing home. She needed every penny and the Attorney should be viewed as behaving disgracefully – The Judge says his behaviour was ”repugnant” – for taking some £120,000.00 to spend on himself.
In the other, the patient owned assets of over £11 million, was living in comfort with a life expectancy of less than five years. She had been financially astute before struck by dementia and had herself earlier given away a million pounds or so to take advantage of Inheritance Tax gift allowances. She did not need the six million, and if she had been able to, the Court agreed that she would have wanted to make the gift of it now and thereby avoid a tax bill on death after three years, potentially saving around £2.5 million pounds in tax.
In summary, you have to make your own mind up whether Judge Lush is correct. He says, don’t make a Deed of Power of Attorney, just rely on the Court to look after you and appoint a Guardian when you need one.
But he has seen, more than anyone else perhaps, so many of the cases which have gone wrong. Certainly many many cases have been just fine, if that word can describe a situation which is always very sad.
So make a decision, and if you’re going to make a Deed, do it before it’s too late. Song –Before It’s Too Late-
One conclusion that does seem to me to be inescapable, is that the Courts are very expensive and as has been the case through history, it is much easier to use the services they provide if you have a few million in the Bank.
Here at AtkinsonNotary we don’t charge millions, so, Remember, if you require our services or if you have any queries on any of the services that we offer then please so not hesitate to email us email@example.com and firstname.lastname@example.org.
Or alternatively please telephone on 0113 8160116 or 07715608747. Please also feel free to visit our website http://www.atkinsonnotary.com