Does a Lasting Power of Attorney allow this?

AnnieBard

Am I right in thinking that where a person (the donor) still has capacity then the attorney/s may only act with the donor’s knowledge and express permission (and if the terms of the LPA allow that)? And am I also right in thinking that an attorney must not open a savings account of any kind in their own name using the donor’s money? And finally is opening a joint account with the donors money in the names of both the donor and the attorney also problematic?

lr1277

For a financial and property LPA, you can act on the donor's behalf before they have lost capacity. They have to agree to any actions before you take said action. Why do you ask if the LPA allows? Is it because there is more than one attorney?

For a health and welfare LPA, you can only act once the donor has lost capacity.

As an attorney, everything you do with the donor's assets MUST be in the sole interests of the donor. So opening an account in the attorney's name with the donor's money would be a NO.

I would say the same would apply for a joint account with the donor, so another NO.

Grumpy_chap

AnnieBard said:

Am I right in thinking that where a person (the donor) still has capacity then the attorney/s may only act with the donor’s knowledge and express permission (and if the terms of the LPA allow that)? And am I also right in thinking that an attorney must not open a savings account of any kind in their own name using the donor’s money? And finally is opening a joint account with the donors money in the names of both the donor and the attorney also problematic?

Opening an account, or joint account, in the name of the Attorney also means that money (or proportion of that money) is assessed as being the Attorney's asset which would impact the Attorney should they claim benefits or need care in their own right etc.

AnnieBard

lr1277 said:

For a financial and property LPA, you can act on the donor's behalf before they have lost capacity. They have to agree to any actions before you take said action. Why do you ask if the LPA allows? Is it because there is more than one attorney?

For a health and welfare LPA, you can only act once the donor has lost capacity.

As an attorney, everything you do with the donor's assets MUST be in the sole interests of the donor. So opening an account in the attorney's name with the donor's money would be a NO.

I would say the same would apply for a joint account with the donor, so another NO.

There is more than one attorney, yes, and there is disagreement between the attorneys regarding these issues. I am concerned to help the donor navigate the situation, hence my asking these fairly simple questions on the donor’s behalf … I’m hoping to be able to show the donor the answers received here and help them decide how to proceed.

theoretica

If the donor still has capacity there is nothing to stop them opening a joint account with their attorney.  My parents have joint accounts, and LPA for each other... 

Sarahspangles

You can open a joint account but there are some ‘gotchas’ - the money remains the donor’s but if the attorney needs to claim benefits then the relevant agencies may treat part of it as the attorney’s.  If the donor passes away then all of the money belongs to the estate, but the agencies that deal with benefits may treat it all as the attorney’s. Finally, if the attorney isn’t also an executor they can’t do anything with the money apart from as directed by the executor.

AnnieBard

Sarahspangles said:

You can open a joint account but there are some ‘gotchas’ - the money remains the donor’s but if the attorney needs to claim benefits then the relevant agencies may treat part of it as the attorney’s.  If the donor passes away then all of the money belongs to the estate, but the agencies that deal with benefits may treat it all as the attorney’s. Finally, if the attorney isn’t also an executor they can’t do anything with the money apart from as directed by the executor.

Thank you Sarah I’m going to be more specific in the hope that you might know if this is okay … the proceeds of a house sale have been paid into an NS&I savings account opened in the names of both the donor and one of the attorneys by that attorney without the knowledge or permission of the donor. He had agreed to a savings account being opened in his name for the purpose but he would have not agreed to any of the attorneys name being added to that account had it been suggested to him and neither would the other attorneys had they been aware. 

Keep_pedalling

AnnieBard said:

Sarahspangles said:

You can open a joint account but there are some ‘gotchas’ - the money remains the donor’s but if the attorney needs to claim benefits then the relevant agencies may treat part of it as the attorney’s.  If the donor passes away then all of the money belongs to the estate, but the agencies that deal with benefits may treat it all as the attorney’s. Finally, if the attorney isn’t also an executor they can’t do anything with the money apart from as directed by the executor.

Thank you Sarah I’m going to be more specific in the hope that you might know if this is okay … the proceeds of a house sale have been paid into an NS&I savings account opened in the names of both the donor and one of the attorneys by that attorney without the knowledge or permission of the donor. He had agreed to a savings account being opened in his name for the purpose but he would have not agreed to any of the attorneys name being added to that account had it been suggested to him and neither would the other attorneys had they been aware. 

That is way beyond the authority of an attorney and the donor should A make sure that money is returned to a sole account and B remove that attorney..

Sarahspangles

AnnieBard said:

Sarahspangles said:

You can open a joint account but there are some ‘gotchas’ - the money remains the donor’s but if the attorney needs to claim benefits then the relevant agencies may treat part of it as the attorney’s.  If the donor passes away then all of the money belongs to the estate, but the agencies that deal with benefits may treat it all as the attorney’s. Finally, if the attorney isn’t also an executor they can’t do anything with the money apart from as directed by the executor.

Thank you Sarah I’m going to be more specific in the hope that you might know if this is okay … the proceeds of a house sale have been paid into an NS&I savings account opened in the names of both the donor and one of the attorneys by that attorney without the knowledge or permission of the donor. He had agreed to a savings account being opened in his name for the purpose but he would have not agreed to any of the attorneys name being added to that account had it been suggested to him and neither would the other attorneys had they been aware. 

I agree with Keep_Pedalling. But as a short term arrangement this might be reasonable. There are some special circumstances where NS&I is a good choice for example you can save more than the FSCS limit of £85k that applies to other banks and I’d expect a solicitor to suggest depositing there if it may be relevant. It is a safe choice while investment decisions are being made.  But no need for it to be done covertly.

Does the other attorney live with the donor?

AnnieBard

Sarahspangles said:

AnnieBard said:

Sarahspangles said:

You can open a joint account but there are some ‘gotchas’ - the money remains the donor’s but if the attorney needs to claim benefits then the relevant agencies may treat part of it as the attorney’s.  If the donor passes away then all of the money belongs to the estate, but the agencies that deal with benefits may treat it all as the attorney’s. Finally, if the attorney isn’t also an executor they can’t do anything with the money apart from as directed by the executor.

Thank you Sarah I’m going to be more specific in the hope that you might know if this is okay … the proceeds of a house sale have been paid into an NS&I savings account opened in the names of both the donor and one of the attorneys by that attorney without the knowledge or permission of the donor. He had agreed to a savings account being opened in his name for the purpose but he would have not agreed to any of the attorneys name being added to that account had it been suggested to him and neither would the other attorneys had they been aware. 

I agree with Keep_Pedalling. But as a short term arrangement this might be reasonable. There are some special circumstances where NS&I is a good choice for example you can save more than the FSCS limit of £85k that applies to other banks and I’d expect a solicitor to suggest depositing there if it may be relevant. It is a safe choice while investment decisions are being made.  But no need for it to be done covertly.

Does the other attorney live with the donor?

No, the other attorney is a relative but of a different generation. It’s not that the account is with NS&I that’s the contested issue, it’s that it is in joint names where no permission was sought from the donor for this. 

The same attorney also intends to use the donor’s money to open an ISA in his (the attorney’s) sole name.
I should add that this attorney will also be an executor and a beneficiary of the will when the time comes.

RAS

Who is the alternative attorney?