When to use a Power of Attorney?
A Power of Attorney is a legal document that appoints an individual (the ‘Attorney’) to act for another person who is unavailable or unable to make decisions or look after their own financial affairs or personal welfare (the “Donor”). This could be due to incapacity or perhaps living abroad.
The process of granting a Power of Attorney will differ depending on whether the person is capable of granting it and is over 18 years old, or if they do not have the mental capacity to grant it. The Donor must have the mental capacity to create a Power of Attorney.
The authorisations granted in a Power of Attorney can also differ. For example, they can be limited to dealing with a person’s interest in a single property or bank account or they can cover all of a person’s financial affairs, including general dealings with government bodies and financial institutions.
We recommend that you seek legal advice to ensure the correct guidance and options available are given to you.
What is the difference between a Power of Attorney and a Third Party Mandate?
A Power of Attorney gives power to the individual (the “Attorney”) to act on behalf of the person granting the Power of Attorney (the “Donor”).
A Third Party Mandate gives authority to an organisation, such as the Bank, to obey the instructions of a nominated individual.
Types of Power of Attorney
Ordinary Power of Attorney (OPA)
One way of banking on behalf of someone who has mental capacity is by having what is called an Ordinary Power of Attorney. This enables you to make financial decisions on behalf of the account holder (known as the donor). However, an Ordinary Power of attorney stops being legal authority if the donor loses mental capacity or in the event of death.
There is a standard form of words to grant an Ordinary Power of Attorney. For more information, contact a solicitor.
Enduring Power of Attorney (EPA)
An Enduring Power of Attorney is when a person makes a decision, before they become incapacitated, to appoint somebody they trust (the Attorney), to look after their finances or property. EPAs can no longer be made as they were replaced by Property and Financial Affairs Lasting Powers of attorney (LPAs) under the Mental Capacity Act 2005. However, if there was an EPA in place before 1 October 2007, it can still apply.
If the Donor has mental capacity, you can use the EPA without it having to be registered with the Office of Public Guardian.
However, if you believe the Donor has lost or is losing their mental capacity, you can only operate the EPA if you register it with the Office of the Public Guardian (OPG), even if you registered it with the Court of Protection before October 2007.
Lasting Power of Attorney (LPA)
A Property and Financial Affairs Lasting Power of Attorney enables a person (called the Donor) to appoint another person (the Attorney) or people to make decisions about their finances and property if they become unable to make these decisions and, in some cases, while the donor still has mental capacity.
An LPA must be made by the donor. They can choose to give you, the attorney, authority immediately or only when the donor loses the ability to make decisions. The donor can place restrictions on how you can manage the account, and can also include guidance for you in the LPA. You will need to make sure that any restrictions, conditions or guidance do not prevent you from being able to manage the account.
Before you can use your authority, the LPA must be registered with the Office of the Public Guardian (OPG). Having the LPA registered does not mean that the donor has lost their mental capacity.
For more information about making an LPA, contact a solicitor or an experienced adviser (for example, a Citizens Advice Bureau) or see the websites at www.adviceguide.org.uk/england.htm and www.gov.uk/ .
Ordinary | Enduring | Lasting | |
|---|---|---|---|
What can the attorney do? | Make financial decisions on Donor’s behalf | Make financial decisions on Donor’s behalf | Two types of Lasting Power of attorneys dependant on what the Donor wants the attorney to do: 1) Health and Welfare 2) Property and Financial Affairs |
When does it come to an end? | Automatically if Donor loses mental capacity, dies or becomes bankrupt. If the Donor contacts the Bank to revoke it. | Automatically if Donor dies. Suspended if Donor loses mental capacity, until the attorney has registered it with the Office of the Public Guardian. | Automatically if Donor dies. If the Donor contacts the Office of the Public Guardian to revoke it. |
Additional information | N/A | Cannot be created on or after 1 October 2007, but any created before are still capable of being registered with the Office of the Public Guardian.
| Must be registered with the Office of the Public Guardian. If the Donor loses mental capacity, and the Lasting Power of Attorney is not registered, we will not be able to accept it. You can find out more information on Lasting Power of Attorneys on the Government Website. You can obtain the forms and guidance for Lasting Powers of Attorney directly from the Office of the Public Guardian . |
Acceptable Power of Attorney
Cynergy Bank can only accept the following:
Lasting Power of Attorney: Property & Financial Affairs
Ordinary Power of Attorney: drawn in the UK and must be drawn in accordance with the laws of England, or Scotland, applicable UK Law and signed as a Deed
Continuing Power of Attorney: Financial Affairs (Scottish Equivalent)
Ways you can contact us
Phone us
0345 850 5555 (or +44 (0) 20 3375 6422 if you're calling from outside the UK)
