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Attorneys and deputies should be aware

View profile for Lisa Cox
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You can appoint attorneys to manage your property and financial affairs if you lose capacity, or to assist you whilst you have capacity. When making a Lasting Power of Attorney you are referred to as the donor and, typically, it would be family member or trusted advisor who you would appoint as an attorney.

Attorneys have wide ranging powers, unless expressly excluded, including the ability to make gifts from the donor’s funds. Similarly, deputies appointed by the Court of Protection for someone who has lost capacity but did not appoint an attorney are often granted the same power. However, there are strict limits on gift-giving which attorneys and deputies need to be aware of in order to avoid inadvertently breaching their duties.

Under The Mental Capacity Act, an attorney and deputy may make reasonable gifts on customary occasions to relatives or friends of the donor or to charities whom the donor has made or might have been expected to make gifts to. The Act defines customary occasions as events i.e. birthdays, marriages or any occasion where it is customary to give gifts, such as at Christmas.

Attorneys and deputies should be aware that other transactions can be considered as a gift even though there was no intention to make a gift. Guidance by the Office of the Public Guardian, who monitor deputies and attorneys, give examples of such transactions; paying someone’s school or university fees, making interest free loans, living rent free at the property of the donor or selling the donor’s home at an undervalue. If an attorney or deputy want to make such gifts, or any other gift that is not as a result of a customary occasion, then they must obtain approval from the Court of Protection.

The difficulty lies in the fact that it is normally a close family member who is appointed to act as an attorney or deputy and, due to family dynamics, it is usually considered that the donor would have made the “gift” if they had capacity to do so. Therefore, gifts can be made without realising approval is required. Should this happen, then the attorney or deputy can be investigated by the Office of the Public Guardian.

It is however possible to make an application for retrospective approval from the Court of Protection if you have inadvertently made such a gift. These applications can be complex and require a high level of detail.

Our dedicated Court of Protection team has experience in dealing with gifts by deputies and attorneys. If you require advice on whether you can make a gift or need to make an application to the court for approval, please contact us to obtain specialist advice. I am based at our Colchester office and can be reached on 01206 217307 or lisa.cox@birkettlong.co.uk.

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