A year or so ago Mr. and Mrs. Smith* came to see me.
Mr. Smith was sadly suffering from mild (early stage) Alzheimer’s disease and as a result of her husband’s ill health Mrs. Smith had given up work to look after him. Given the drastic fall in their monthly income, their home had become far too expensive to run and Mrs. Smith now wanted to sell up. However, as the property was in their joint names both Mr. and Mrs. Smith’s signatures would be required on any transfer deed. Mrs. Smith was concerned about her husband’s deteriorating health and was worried that by the time a sale had been agreed, he would not have the capacity to sign the paperwork. Mrs. Smith was keen for her husband to appoint her as an Attorney so that she would be able to sign on his behalf when the time came.
A Lasting Power of Attorney made by him, in her favour, would have given her full authority to sell and this is what she wanted me to put in place.
Mrs. Smith asked me to speak to her husband about a Lasting Power of Attorney. She explained to me that he had good days and bad days and Mrs. Smith was hopeful that I would catch him on a good day. Unfortunately, it was a bad day and I quickly came to the conclusion that Mr. Smith was not capable of understanding the document and as such, I was unable to proceed.
What options are available?
Mrs. Smith wanted to know her options. She wondered whether she would be able to proceed with the sale on her own, as her name was clearly on the Deeds. Sadly not. I explained that there were two options, either stay in the property with the financial pressures that it would bring or apply for a Court Order called ‘Deputyship’. This would allow Mrs. Smith to have control of her husband’s finances. I warned her that the process could take up to a year and there would be significant costs involved. To start with there would be an initial court fee of £400* followed by further court fees, fixed legal fees of £1,020 and an insurance premium that she would need to pay annually whilst acting as Deputy.
Mr. and Mrs. Smith came to see me too late and Mrs. Smith had no choice but to apply for Deputyship. It was the last thing she wanted to deal with whilst coming to terms with her husband’s illness. The Deputyship Order took eight months to come through and the couple suffered financially both through paying the various application costs and the additional property costs they had to pay due to the sale being delayed.
How can a Lasting Power of Attorney help you avoid a similar situation?
All of this could have been avoided if Mr. and Mrs. Smith had completed a Lasting Power of Attorney ahead of time.
I share the view of money saving expert Martin Lewis, that everyone over the age of 40 should have a Lasting Power of Attorney in place; certainly in relation to their property and financial affairs, if not their personal welfare as well. Think of it as an insurance policy. A small investment now could save you so much money, stress and time later on. I honestly believe that in many cases a Lasting Power of Attorney can be even more important than a Will. Though, of course, you should really have both documents in place.
Please don’t leave it until it’s too late.
For more information on creating a Lasting Power of Attorney or any other personal law matters, please contact our Personal Law team on 0161 475 7676.
*All names used in this blog are for demonstration purposes only.
*Figures listed above are correct at February 2017.