Under most construction contracts, the contractor takes on the ground conditions risk. However, a recent case has demonstrated that the risk can fall on the employer.
Lasting Powers of Attorney (LPAs) can be extremely powerful documents in terms of enabling others to deal with your affairs when you have lost the capacity to do so for yourself. The legislation seeks to strike a balance between the regulated oversight of the attorney’s actions by the Office of the Public Guardian (OPG) whilst imposing some checks and balances to try and prevent abuse of vulnerable individuals.
The current regime of LPAs, therefore, requires a certificate provider to countersign the document to confirm that the donor has the mental capacity to make the document and give the power. Once completed, a power of attorney also has to be registered with the OPG before any attorney can begin to exercise their powers.
The legislation and accompanying regulations contain various rules and restrictions about who may act as certificate provider or witness to the donor’s and the attorney's signatures. Once again these are designed to try and prevent abuse of vulnerable individuals. Unfortunately, however, they can often catch out the unwary with significant implications.
The recent case of the Office of the Public Guardian and PGO, MAB and MJD ( EWCOP13) is a case in point. BGO executed both a finance and a health and welfare lasting power of attorney in which she appointed her husband and two solicitors as her attorneys with authority to act jointly and severally. Both of the LPAs were registered by the OPG, and it was only sometime later that a financial institution noticed that the donor's signature had been witnessed by one of the attorneys – it would seem by one of the solicitors.
The current version of the LPA document makes it clear that an attorney and a replacement attorney must not witness the signature of the donor. As a result of this error (which was not picked up by the OPG), the court confirmed that the legislation renders the document invalid and incapable of rectification. As a result, the only way forward was either to complete fresh lasting powers of attorney if the donor still had capacity or to apply to the Court of Protection for the appointment of a deputy because the donor had lost capacity.
Whilst the Court of Protection will appoint a deputy in relation to an individual's financial affairs in almost all cases, it is far less willing to grant a health and welfare power of attorney – especially with the same wide scope of a health and welfare lasting power of attorney. In this case, the donor had lost capacity so that it was not possible to create fresh lasting powers of attorney. The costs and regulatory regime for Deputyships are more expensive and time-consuming than LPAs highlighting the need to observe the regulations carefully.
For further information about any of the issues raised in this ebriefings, please contact Clare Burke.
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