The Difference Between Lasting Powers of Attorney & Deputyship
In the Deputyship Department one of the most common questions clients ask us is “What’s the difference between Lasting Powers of Attorney and Deputyship?” The answer is fairly straightforward – a Lasting Power of Attorney (LPA) is a document that you sign whilst you still have mental capacity, appointing someone to be your Attorney to act on your behalf. A Deputyship is when the Court appoints someone to be your Deputy (similar to an Attorney) to act on your behalf, once you have lost mental capacity. Both arrangements appoint someone to act on your behalf when you can no longer manage your affairs, but one takes place before losing capacity (LPA) and one takes place afterwards (Deputyship).
Lasting Powers of Attorney
There are two types of Lasting Power of Attorney, one which deals with your property and financial affairs and one which deals with your health and welfare decisions. You can have either, or preferably both, and you can have the same or different Attorneys for each. Once the documents are signed by both you and your Attorney(s) they also need to be signed by a Certificate Provider, who is a professional person (ideally your GP) or someone who has known you for longer than 2 years. The document is then sent to the Office of the Public Guardian for registration and, once returned, can be used immediately if you lose capacity to make decisions or manage your own affairs (or in the case of a property and financial affairs appointment for convenience if, for example, you were on holiday and needed something signed). You can include various clauses in your LPA, such as giving your Attorneys the power to defer decisions regarding your stocks and shares to a portfolio manager, or not allowing your Attorneys to use the document until a GP has confirmed that you have lost capacity.
Deputyship
A Deputyship Order can only be issued by the Court of Protection. If an individual loses capacity to deal with their own affairs and they have not made a Lasting Power of Attorney then an appropriate person can apply to the Court to be appointed as their Deputy. A Deputy has similar responsibilities to an Attorney, with some additional duties because they have been appointed by the Court.
A Deputyship application is made up of a minimum of four forms which provides the Court with all the necessary information it needs to make an informed decision. The forms are extensive and include details of the protected person’s personal circumstances; their full financial details; a medical opinion confirming lack of capacity and details of the proposed Deputy’s personal and financial circumstances. These forms are sent to the Court with an application fee. At least three people in the protected person’s life must be notified of the application and these can be family, friends and/or their GP if necessary. Once these people have been notified there is a statutory waiting period of four weeks within which they can raise any objections to the application.
Once the notice period has expired the application will be placed in the Court queue to be examined thoroughly and signed off by a Judge. Before an order can be issued the Deputy must pay the first annual bond premium which protects the protected person against losses from Deputy fraud. Once the bond is in place the Court will issue the final Deputyship Order, which is the document which gives the Deputy authority to act.
A Deputy is required by the Court to keep complete records of all income and expenditure of the protected person and to complete an annual report on the anniversary of the Deputyship Order including all of this information.
Costs and Timescales
As you will have gathered, the Lasting Power of Attorney process is much simpler and quicker than that of a Deputyship application.
Our current costs for a Lasting Power of Attorney are £500 plus VAT for one document, £750 plus VAT for two and £1,000 plus VAT for both finance and welfare documents for a couple. A registration fee of £82 for each document is payable to the Office of the Public Guardian. Registration takes roughly two months to complete.
We estimate our costs for a straightforward Deputyship application at between £2,000 and £2,500 plus VAT. In addition to our costs the Court application fee is £365, the annual bond payment is generally between £200 and £400 and there is an annual supervision fee also payable to the Court of £320 (unless the protected person’s assets are below £21,000 when the fee amounts to £35 per annum).
A Deputyship application takes roughly six months from initial instruction to the issue of the final order. During this period the protected person is no longer able to make decisions for themselves or sign cheques or financial paperwork, but neither is the Deputy as they do not yet have authority, leading to a protracted period of ‘no man’s land’ where no-one can settle expenses, enter into new contracts etc.
We are always keen for clients to sign Lasting Powers of Attorney to avoid the necessity of a Deputyship Order later on in life. Any of our Probate Trusts and Wills Practitioners can assist you with your Lasting Powers of Attorney documents. However, when it comes to Deputyships we have a highly experienced Deputyship Team, who specialise in applications to the Court, annual reporting and the day to day running of Deputyship matters for both elderly clients, adults lacking capacity and brain damaged infants. Because our team are dealing specifically with these matters on a daily basis they are able to deal with your matter more quickly and efficiently than other firms who may only deal with these types of matters sporadically. With most professional costs incurred in connection with Deputyship matters being assessed by the Court before settlement, you could pay the same professional fees for an excellent service as for a less efficient service elsewhere. You can meet our Deputyship Team by clicking here
Tracy Rowden
Associate & Chartered Legal Executive