Choosing a power of attorney

Choosing a power of attorney

Contents

A power of attorney is a document that gives another person (your 'attorney') the authority to act on your behalf. There are two different types of power of attorney that you can create in Northern Ireland:

  • General power of attorney
  • Enduring power of attorney (EPA)

This article will help you to decide which of these is best suited to your needs.

Initial questions

The first issue to decide is whether you want the power of attorney (PoA) to be valid only while you have the mental capacity to make your own decisions, or whether you want it to remain valid after that point.

You may lose your mental capacity due to factors such as illness, an accident or the onset of conditions like dementia. If that happens, your relatives can't automatically take over your financial affairs. You will need to create an 'Enduring power of attorney' (EPA), before that happens, so that the people you choose will have the authority they need, should it become necessary.

If you don't need the PoA to remain valid in the event that you lose the capacity to act on your own behalf, then you will need a general power of attorney. This type of power is useful if you only need someone to take care of your affairs for a limited period of time. Perhaps you are in the military and deployed, for example, and need someone to manage your accounts in your absence.

General power of attorney

This type is also known as an 'ordinary power of attorney'.

You can use a general power of attorney to give another person the right to act on your behalf while you have the mental capacity to do so yourself but are temporarily unable to attend to your affairs, for example, because you're on holiday. This type of PoA is intended for use over a limited period of time.

A general power of attorney can't be used after the person who made it (the 'donor') has lost the capacity to make their own decisions.

For more information, read the article on General powers of attorney.

Enduring powers of attorney

An enduring power of attorney gives another person the power to manage financial affairs on your behalf. This can include such things as (subject to any restrictions you make) paying bills, selling property and managing bank accounts.

If you become incapable of making financial decisions and lose the ability to manage your own affairs, this type of power of attorney 'endures' and continues in force until death, but subject to certain important conditions and safeguards. By planning ahead and making an EPA, you are able to give your instructions while you are of sound mind, in anticipation of the possibility of not being capable at some future date. Note that you can choose when setting up an EPA that you don't want it to come into effect until you lose the ability to manage your own affairs, or you can choose for it to come into effect straightaway.

It makes sense to consider appointing an attorney under an EPA ahead of time because once someone has become mentally incapable they can't validly appoint an attorney.

Without an EPA in place, your friends and family do not automatically have the right to take over. Instead, a 'controller' may be appointed by the court. This can be more expensive than entering into an EPA. See What is a controller? for more information.

If you have already made a will, then an EPA will complement this and help to reassure both you and your family that you have made detailed plans for the future.