The rights and responsibilities given by a Lasting Power of Attorney ('LPA') end when the person who gives them (known as the 'donor') dies. The same applies for a general power of attorney.
The effect is that if you have been acting as an attorney for someone who has passed away, you no longer have the right to deal with their financial affairs nor to decide what happens with their body. Instead, the executor or executors of their Will step in.
Bear in mind that if you have been their attorney, you may also be an executor of their Will.
Should you make an LPA if you have a Will?
There are two types of LPA, and there are good reasons why you should make both. What they do is allow people you nominate (your 'attorneys') to make decisions for you, usually once you lose capacity to make them yourself. One type of LPA covers health and welfare decisions, the other deals with financial decisions.
A Will only takes effect once you've died. There may be a long period between losing mental capacity and dying, and some decisions (such as about your health) are only relevant while you're alive. There is such a thing as a Living Will, but it doesn't have the legal authority of an LPA.
Given that your family members don't have automatic rights to act on your behalf (it is, for example, illegal for a family member to withdraw cash from a bank or building society cash machine using your personal identification number), an LPA should be as much on your to-do list to make as a Will. They can make your relatives' lives easier at difficult times, and ensure you are cared for as you wish. Common jobs for an attorney include looking after property, receiving benefit payments and paying bills.
Note that an LPA needs to be registered before the donor loses mental capacity in order for the attorneys to gain legal power.
When does a Lasting Power of Attorney end?
An attorney stops acting the moment the donor dies. From that point onwards, it is no longer valid. The same applies to an Enduring Power of Attorney ('EPA') made before 2007.
Power of Attorney also ceases if all the all the attorneys appointed by it die before the donor; or decide to stop acting, or become unable to act in their role.
What should an attorney do on the death of the donor?
After the donor's passing, an attorney must act promptly. You must:
- not carry out any further transactions under the LPA;
- inform the the Office of the Public Guardian, returning the original LPA document and all certified copies, and providing a copy of the death certificate.
If you fail to do this, and particularly if you continue to act as if you were an attorney, you have personal liability for your actions. In other words, you become responsible for any financial losses. Courts might order you to repay money or face criminal charges for fraud. It is best to minimise legal complications by acting as soon as possible.
Common errors include:
- receiving benefits on behalf of the deceased;
- continuing to pay bills from the deceased's account;
- making investment decisions; and
- distributing assets such as jewellery.
How to obtain and use a death certificate
A death certificate serves as legal proof of the donor's passing. To obtain one:
- Register the death at the local register office within 5 days in England, Wales, and Northern Ireland.
- Request multiple copies of the certificate, ensuring they are certified copies for official use, and consider obtaining extra copies for unforeseen needs. The executors of the estate will need these copies to notify banks, building societies, and other institutions.
In England and Wales, the register office typically issues the death certificate within 5 days of registration.
What happens if the attorney of an LPA dies?
If a named attorney dies before the donor, what happens next depends on what the donor decided when they made the LPA.
You can nominate a replacement attorney within the LPA.
If the deceased attorney is the sole attorney, and a replacement has nominated, then the replacement takes the place of the deceased.
If there is no nominated replacement, the LPA is no longer valid. The donor will need to make a new lasting power of attorney document. The problem here is that they may not still have the mental capacity to do so. For this reason, it is wise to nominate:
- a primary attorney who is much younger; or
- more than one primary attorneys; and/or
- a replacement.
If you appoint multiple attorneys, you have to state whether you want them to take all decisions unanimously, or whether they can make them independently. If one of them dies, and they must all make decisions together, the situation is the same as if there were only one attorney. However, if they can make decisions independently of each other, then the LPA remains valid.
How does an attorney's role differ from that of an executor?
An attorney manages the donor's affairs while they're alive but lack mental capacity to make decisions for themselves, whereas an executor's function is estate administration - protecting, quantifying and distributing the deceased's estate after death.
An attorney's authority ceases at death, while an executor's starts.
Confusion often arises because you might be nominated as both. You just need to know which hat you are wearing to understand your powers, rights and responsibilities.
What happens if there is no Will?
When a donor dies without a Will, they die intestate. The rules of intestacy set out how the estate is distributed, overriding any wishes the donor might have said verbally or in informal written instructions.
Intestacy is common. Just over half of the UK adult population lack a valid Will.
How do the rules of intestacy work?
The rules of intestacy set out a specific order of succession based on family relationships. They state who inherits and how much. The order of inheritance is:
- spouse or civil partner (as civil partnership provides similar legal rights to marriage);
- children;
- parents;
- siblings;
- grandparents; then
- aunts and uncles.
Unmarried partners and step-children do not automatically inherit under these rules. Additionally, children from earlier relationships can be 'accidentally disinherited' because current spouses have superior rights.
The rules apply regardless of the closeness of relationships or the donor's verbal wishes.
Who can administer an estate without a Will?
When someone dies without a Will, an administrator manages the estate.
The Administrator applies for Letters of Administration - similar to a grant of probate. The process includes sending forms to the Probate Registry, paying fees (which must be paid before the grant is issued), and swearing an oath. Estate administration afterwards is very similar to when there is an executor. But there is a higher cost to your estate if you don't have a Will, and it is much more difficult for your friends and family to manage your affairs.