Power of attorney

imaginarynumber

Apologies if I am asking this in the wrong sub forum.

My mum currently helps an elderly friend whose spouse died last year.

She is still more than capable of independent living but might not be in a year or two (or even less).

Her financial adviser has noticed that she has become less rational and recommended that my mother tries to broach the subject of power of attorney. My mother is resolute that she does not want to shoulder the responsibility of having power of attorney .

The only living relative is even older and in ill health.

In circumstances where there are no suitable friends or relatives, what (typically) happens?

Does one appoint a solicitor and then give powers of oversight to a third party, eg my mum and or her financial adviser or even a second solicitor?

Although my mother agrees that some degree of power of attorney (in the event of illness etc) would be prudent, she is worried about being the person to recommend it and then discover later that the appointed person has not been acting in the best interests of the old lady.

Any advice would be gratefully appreciated.

Savvy_Sue

Court of protection gets involved if the person doesn't manage to set up PofA before losing the plot.

Tricky, but tbh I don't blame your mum for not wanting the responsibility!

Mojisola

imaginarynumber wrote: »

My mum currently helps an elderly friend whose spouse died last year.

Her financial adviser has noticed that she has become less rational and recommended that my mother tries to broach the subject of power of attorney.

Although my mother agrees that some degree of power of attorney (in the event of illness etc) would be prudent, she is worried about being the person to recommend it and then discover later that the appointed person has not been acting in the best interests of the old lady.

Your mother could suggest that the friend's financial advisor raises the issues him/herself.

Malthusian

imaginarynumber wrote: »

Although my mother agrees that some degree of power of attorney (in the event of illness etc) would be prudent, she is worried about being the person to recommend it and then discover later that the appointed person has not been acting in the best interests of the old lady.

There is nothing to worry about if she tells her friend that she should draw up a power of attorney; that is a simple objective fact. It's not her fault if her friend then appoints the wrong attorney.

If she doesn't have any friends or relatives willing to be an attorney she could appoint a solicitor to do so professionally. This would obviously cost money, but it may be worth it to avoid having to get clearance from the Court of Protection for everything, which is a very slow process. If she has significant assets (having a financial advisor suggests she does) then having these properly managed may outweigh the fees.

Her adviser may be able to recommend a solicitor.

*edit* I really think your mum has very little to worry about with her friend appointing the wrong attorney. When something goes wrong with powers of attorney, it is virtually always because they appointed their children or their nephews as attorneys and the !!!!less sods then use the PoA to steal their money. But this isn't going to happen in her friend's case because she doesn't have any relatives to grant PoA to. My reading of anecdotal evidence suggests it is usually relatives, not friends and certainly not solicitors who abuse PoAs - people tend to be more choosy when appointing people without a blood connection.

Does one appoint a solicitor and then give powers of oversight to a third party, eg my mum and or her financial adviser or even a second solicitor?

If she gives power of attorney to a solicitor then that solicitor is in charge (once it is active). There is no "power of oversight". They might consult your financial adviser and/or your mum but they have no duty to them, only to the donor. The "oversight" is that if they act against the donor's interests the Court of Protection might get involved, but that should be very unlikely with a solicitor-attorney.

imaginarynumber

Malthusian wrote: »

There is nothing to worry about if she tells her friend that she should draw up a power of attorney; that is a simple objective fact. It's not her fault if her friend then appoints the wrong attorney.

If she doesn't have any friends or relatives willing to be an attorney she could appoint a solicitor to do so professionally. This would obviously cost money, but it may be worth it to avoid having to get clearance from the Court of Protection for everything, which is a very slow process. If she has significant assets (having a financial advisor suggests she does) then having these properly managed may outweigh the fees.

Her adviser may be able to recommend a solicitor.

*edit* I really think your mum has very little to worry about with her friend appointing the wrong attorney. When something goes wrong with powers of attorney, it is virtually always because they appointed their children or their nephews as attorneys and the !!!!less sods then use the PoA to steal their money. But this isn't going to happen in her friend's case because she doesn't have any relatives to grant PoA to. My reading of anecdotal evidence suggests it is usually relatives, not friends and certainly not solicitors who abuse PoAs - people tend to be more choosy when appointing people without a blood connection.

If she gives power of attorney to a solicitor then that solicitor is in charge (once it is active). There is no "power of oversight". They might consult your financial adviser and/or your mum but they have no duty to them, only to the donor. The "oversight" is that if they act against the donor's interests the Court of Protection might get involved, but that should be very unlikely with a solicitor-attorney.

I get the impression that cost is not an issue.

The lady has a solicitor. Would you recommend using a second solicitor as the POA or is there no logical reason to appoint the existing solicitor as the POA?

And whilst there is no scope of oversight, is it possible to nominate people that must be informed in the event of significant "decisions"?

BTW thank you and thank you to Mojisola and Savvy_Sue

Malthusian

imaginarynumber wrote: »

The lady has a solicitor. Would you recommend using a second solicitor as the POA or is there no logical reason to appoint the existing solicitor as the POA?

On the face of it, no logical reason not to appoint the existing solicitor. They are most likely to be the best choice if they know her and her circumstances.

And whilst there is no scope of oversight, is it possible to nominate people that must be informed in the event of significant "decisions"?

Yes, sort of. Firstly you can nominate people who will be notified when the PoA is registered (i.e. when the donor has lost capacity and the attorney registers with the PoA so they can manage their affairs). However, they would have no further involvement once they'd had their notification. They could at this point raise the alarm with the Court of Protection if something dodgy is going on, but they would not be notified about any subsequent decisions.

You can also enter "preferences" and "instructions" as to how you would like your attorneys to manage your financial affairs. "Preferences" should be borne in mind by an attorney but they don't have to follow them, whereas "instructions" are binding on them. So you could in theory write "My attorneys must notify [X] about any significant decisions they take."

You need to be careful about instructions however as badly-worded ones can render a PoA unworkable. "Significant decision" is open to interpretation. If a solicitor is required to notify some third party every time they make a decision they will bill the donor for this. Your mum's friend needs to take professional advice before she does anything like that.

There is really little point in writing an instruction like that into the PoA because even if the person notified objects to what the attorney is doing, they have no power to stop them, as they aren't attorney and it's none of their business. I'd go as far to say that it's quite cruel of the donor to hand them responsibility without power. If the attorney is doing something dodgy, then they will simply ignore the instruction to notify the third party.

People tend to get this idea with powers of attorney that the more people they involve, the less likely they are to make bad decisions. It doesn't work like that, and it leads to all sorts of problems when they appoint multiple attorneys who fall out. Democracy is not a good system for running an individual's affairs. If you don't trust an attorney to make the right decisions unless they are muzzled by an instruction to notify a third party about everything they do, then don't appoint them as an attorney in the first place.

securityguy

"People tend to get this idea with powers of attorney that the more people they involve, the less likely they are to make bad decisions."

As I've mentioned before, my parents attempted to get my brother and me to be joint (and not several) attorneys. We refused point blank, as it would be a large amount of extra work and boils down to our parents not trusting us enough individually but nonetheless trusting us enough to stop the other being bad. If they believe one of us is bad, don't make them an attorney. If they believe neither of us is bad, what is the point of joint powers? If they believe both of us are bad, how does it help to have both of us being bad in concert? They saw sense and made it joint and several, which is the sensible decision.

elsien

In case you weren't aware, there are two possible powers of attorney, one for finances and one for health and welfare.
All the people I've come in contact with where the solicitor is power of attorney it has only been for finances. I'm not sure if solicitors could be a health/welfare POA but I strongly suspect if they can it is far more responsibility than they would wish to have.

getmore4less

Having significant decisions notified to a third party, why that 3rd party cannot do anything.

The solicitor and or the financial advisers may be suitable, if they have been trusted to be executors and manage the finances then this is a natural choice in the absence of anyone else.

presumably the FA is acting/advising on dealing with her assets if she trusts that person(eg taking the advice and instructing) then why not have them continue with that role.

Same with the solicitor thy will probably be more clued up on the legalaties so together they could do a good job, at a cost.

It would make sense for the LPA to be registered immediately.

The rules are clear that the attorneys do not act independent of the donor while the donor has capacity even if partial.
This would allow a natural transition if those professionals were chosen.


The idea of notification even when registering IMO just goes against the principle of picking people you trust

One way to broke the subject is to say you are happy to be the certificate provider(if she qualifies).

This is something that should have come up when hubby died as her own will should have been reviewed and LPA considered at the same time.

I would also suggest that if Mum does not want the responsibility then she should let those that are chosen get on the with e job and forget about the idea of getting notified of anything, you are either in or out.

Malthusian

getmore4less wrote: »

Having significant decisions notified to a third party, why that 3rd party cannot do anything.

The solicitor and or the financial advisers may be suitable, if they have been trusted to be executors and manage the finances then this is a natural choice in the absence of anyone else.

In my experience the IFA would usually refuse as they would have to step down as financial advisers. Otherwise they would be advising themselves and there is a conflict of interest. The IFA can hardly charge the attorney (on behalf of the client) for his expertise when the attorney already has the exact same level of expertise due to being, er, himself and therefore doesn't need it.

It is however the kind of job that a solicitor should be able to do.

Yorkshireman99

At a huge, and indeed, disprportionate cost. It really is the last resort.