Guest post contributed by Peter Earle, Specialist Estate Planning Consultant with Legacy Legal
Kate Garraway has long been a familiar face on the morning news circuit, but recently found herself in the spotlight for more personal, and difficult, reasons. In March this year, her husband Derek Draper contracted Covid-19 and has remained very seriously ill, including a long period of time in a medically-induced coma.
In addition to the emotional toil this situation must have placed on Garraway and her family, she has also spoken recently of the difficulties she is facing in a practical sense. She explained the ways in which dealing with general paperwork, particularly that surrounding financial matters, is becoming more and more difficult due to the amount of policies in her husband’s name.
Draper does not have a Power of Attorney- a document that would allow Kate to act on his behalf-in place, and therefore she will not be allowed to carry out even simple tasks, or discuss policies on behalf of her husband.
This distressing story leads us to the exact nature of Lasting Powers of Attorney, and why they can be so important.
A Lasting Power of Attorney, or LPA, allows an individual to appoint a third party to make decisions on their behalf when they no longer have the capacity to do so themselves. If someone doesn’t have LPA’s in place, and they become mentally incapacitated, their loved ones can face long delays and an onerous application to The Court of Protection to gain access to their finances and make decisions on their behalf.
During this process, assets are likely to be frozen, including joint assets, which can cause significant problems for relatives who may need to make arrangements to pay bills, for any ongoing care needs.
Why power of attorney is all-important, but even more so during the Covid-19 pandemic
There are two types of LPA; a Property and Financial Affairs LPA and a Health and Welfare LPA. The Property and Financial Affairs LPA gives attorneys the authority to look after the donor’s finances – including buying and selling property, dealing with bills, running bank accounts and investing money. The Health and Welfare LPA allows attorneys to make decisions about medical treatment, or day to day care, on behalf of the donor in the event that they become unable to make those decisions themselves.
Business owners can create separate LPAs for their business interests, allowing them to appoint specific attorneys to look after their business affairs. This prevents personal attorneys exposing both themselves, and the business in question, to unnecessary risk.
Luckily I understand Derek Draper is on the road to recovery; one which I hope is both quick and full. However I am very grateful to Kate Garraway for using her influence and voice to shine a light on an area in which so many individuals are still left exposed and vulnerable, and hope it reveals why nobody can afford to be without an LPA.