Powers of Attorney
Some people may be temporarily unable to look after their own affairs through illness, absence, or accidents. Others may be permanently incapacitated by the onset of illness. Having a Power of Attorney in place before these events strike can save an immense amount of hassle, expense, and heartache.
There has been a lot in the news recently about a change in the law allowing people to grant Enduring Powers of Attorney. This recent change in the law actually refers to English and not Scottish law. It has been possible to grant a very similar type of Power of Attorney in Scotland since the year 2000.
The first question that needs to be answered is what is a Power of Attorney and when do you grant one? A Power of Attorney is when you nominate somebody you trust to carry out your affairs on your behalf. For example if you were going to live abroad for a couple of years you could appoint somebody to take care of your affairs whilst you were out the country. Alternatively you may become housebound and may need somebody to arrange affairs on your behalf e.g. working your bank or building society accounts.
Under the laws of Scotland it has always been possible to grant a Power of Attorney. Until 2000 the major flaw with a Power of Attorney was that the powers under it immediately fell as soon as the grantor lost legal capacity. Therefore if somebody became incapacitated through say dementia the Attorney would lose his powers at a time when his powers would become perhaps even more essential. Previously to remedy this situation the attorney’s powers could only be restored by court approval which was a costly and lengthy procedure.
Now under new legislation called Adults with Incapacity (Scotland) Act) 2000 it is now possible to grant a Power of Attorney which will continue its powers after the grantor has lost capacity whether on a temporary or permanent basis.
There are two types of Powers of Attorney which can be granted in Scotland which are a Continuing Power of Attorney or a Welfare Power of Attorney. A Continuing Power of Attorney lets your Attorney deal with your financial affairs whereas a Welfare Power of Attorney lets them make decisions about your personal welfare. If you wish your Attorney to have both types of power it is possible to combine a Continuing and Welfare Power of Attorney into the one legal document.
If a Continuing or Welfare Power of Attorney is not in place and somebody loses their capacity a court order called a Guardianship Order or Intervention Order has to be obtained from the Scottish Courts. Once the Order has been set up the representative of the incapacitated person has to report to the Office of the Public Guardian (a government body).To obtain such an order is a costly and length procedure. In addition even when the order has been granted there will continuing administrative fees to be paid to the Office of the Public Guardian throughout the duration of the Order.
People often believe that it is only elderly people with the risk of dementia who should be thinking of drawing up such a Power of Attorney. Really every adult in Scotland should consider having one. Although it does not bear thinking about, but what if you were run over by a bus and were in a coma for 2 months. Unless you had a Continuing Power of Attorney it would be impossible for your nearest and dearest to manage your affairs during your illness.
Equipped with this information hopefully the reader will realise the importance of having either a Continuing Power or Welfare Power of Attorney. It is always important to draw up a Will but it is of equal importance to draw up a Power of Attorney with a continuing power.
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