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The Value of a Lasting Power of Attorney — particularly for cohabiting couples

If an individual loses mental capacity, it is often the case that someone needs to take over the management of their financial affairs.

Many people assume that their loved ones will automatically be able to take over the management of their finances or make decisions about their personal welfare if they ever become incapacitated. However, that is not the case without proper legal documents in place and the position can be particularly complex for couples who are not married.

Lasting Powers of Attorney

If an individual loses mental capacity, it is often the case that someone needs to take over the management of their financial affairs. There may also need to be decisions made about that person’s care and medical treatment.

A Lasting Power of Attorney (“LPA”) is a legal document which enables an individual to appoint one or more persons (known as their ‘attorney(s)’) to act on his/her behalf if he/she loses mental capacity and became unable to make decisions for him/herself.  

There are two types of LPA: ‘property and finance’ and ‘health and welfare’. The two documents are independent of each other, meaning that different attorneys could be appointed for each.  

Complications without a Lasting Powers of Attorney

Without a LPA in place, there is no automatic right for family members to manage a person’s finances or make decisions about their personal welfare. If a person loses mental capacity without having made an LPA, their family will have to make an application to the Court of Protection to be appointed as their deputy. A Court of Protection application is significantly more costly and time consuming, which often means that assets are effectively frozen for a long period of time whilst no action can be taken.

Even married couples can experience difficulties without LPAs in place. This was shown in the TV documentary following Kate Garraway and Derek Draper’s lives when Derek was incapacitated with COVID-19 in 2020. The documentary demonstrated how, despite being married, Kate faced a number of challenges accessing Derek’s finances which meant she was unable to pay bills which were registered in Derek’s sole name. Even where couples hold money in joint accounts, there is no automatic right for the joint owner to continue using the account when the other party has lost mental capacity.

Unmarried partners face an even more difficult challenge if no planning has been put in place. The idea of the “common law spouse” is a misconception. A relationship without a marriage or formal civil partnership has no formal legal standing, regardless of the longevity of the partnership, meaning that unmarried partners do not have the same rights as a spouse or registered civil partner. 

Without a health and welfare LPA in place, it can be particularly problematic for an unmarried partner to made decisions about medical care and treatment on behalf of an incapacitated person. Unmarried partners have no legal recognition as “next of kin” in the eyes of medical professionals. This often means that other family members are responsible for making decisions about medical or life-sustaining treatment. This may not necessarily be what an incapacitated person would want.

Choosing your own attorneys

If there is no LPA in place and a Court of Protection application is required, the Court will assess all of the circumstances and select who it considers to be the most appropriate person to act as deputy. That may not be the person that the incapacitated individual would have chosen if they had been able to make that decision for themselves. This can be particularly difficult for unmarried couples with, say, adult children from previous relationships as the Court may treat ‘blood’ relatives as having a higher priority than an unmarried partner to make medical treatment decisions in some circumstances.  

By making an LPA, not only can an individual choose who should act on his/her behalf but he/she can also select replacements to step in if the chosen person cannot act. It is also possible to appoint multiple attorneys and decide how they should be able to act together, potentially giving the arrangements more flexibility. An LPA enables an individual to give guidance (legally binding or otherwise) to their Attorneys to ensure that their wishes are followed.

Other planning

Making an LPA is the only way to choose your own attorneys and have the comfort that your partner (whether married or not) can make decisions for you. 

Alongside LPAs, unmarried couples are strongly advised to make Wills if they want to ensure that the survivor of them is adequately provided for in the event of one partner dying. It is always worth remembering that there is no automatic legal provision for a cohabiting partner.

If you have any questions on LPAs, please contact our specialist Lasting Powers of Attorney team.