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News & Blog

Wills, Trusts & Probate Newsletter – March 2014

Welcome to the first in a new series of departmental newsletters from Davis Blank Furniss. Our focus this month is on our Wills, Trusts and Probate team.

DeBrieF FACT SHEET

Laura Johnson – a solicitor in our private client department – discusses the issues and considerations around Lasting Powers of Attorney (LPAs)…

1. What is a Lasting Power of Attorney?
A Lasting Power of Attorney is a legal document that formally appoints someone you trust to look after your property & financial affairs, and your health and welfare if you ever lose the ability to do so.

2. What are the main principles?
Your attorneys must follow the principles of the Mental Capacity Act 2005. The key principle is that your attorneys must always act in your best interests in making decisions for you when you are unable to make a decision yourself.

3. How do I choose my Attorney?
It is important to choose the right attorney. You may choose several attorneys, but they should be able to work together and make decisions in your best interests. You attorneys should be people that you know and trust.

4. What if my chosen Attorney can no longer act for me?
You can name a replacement(s) in case an attorney is unable to or no longer wishes to continue acting for you. An attorney will be unable to act if they are bankrupt or if they are your spouse and you divorce, or they are your civil partner and you terminate the civil partnership. If you are going to the effort of creating an LPA then it is prudent to include a replacement attorney, and this again should be somebody whom you know well and trust.

5. When can an Attorney act?
There are different rules for the two different types of LPAs. Once your LPA for property and financial affairs is registered then your attorneys may act whether you have capacity or not. For your health and welfare LPA, your attorneys may only act once it has been registered and a medical practitioner has certified that you no longer have capacity to act.

6. What decisions can my Attorney make?
In respect of your property and financial affairs, your attorneys may make decisions about your bank accounts, investments or even deal with selling your property. In respect of your health and welfare, your attorneys may make decisions about the medical treatment you receive, whether you move into a residential care home and you must also specifically say whether your attorneys would have authority to make decisions about life-sustaining treatment.

7. What if I change my mind?
Provided you have the mental capacity to do so, you may revoke your LPA at any time. This must be done by a formal deed and registered with the LPA.

8. What measures are in place to protect my personal interests?
An LPA must be registered with the Office of the Public Guardian. The OPG must satisfy itself that you have not been unduly influenced into entering the LPA and that you had mental capacity to create the LPA. The OPG cannot physically check this for every person who registers an LPA and so it has its own safeguarding procedures that everyone must comply with. This involves notifying a friend or relative when you apply to register the LPA and also involves a professional or close personal friend signing the LPA to certify that you fully understand the LPA.

For more information on LPAs, please visit:
http://www.dbf-law.co.uk/lasting-powers-of-attorney/

DeBrieF TEAM SPOTLIGHT

Laura Johnson, solicitor…

What does your role at Davis Blank Furniss involve?
I work in the private client department dealing with all aspects of private client work including creating new wills, advising about estate planning, administering probate, setting up trusts, including personal injury compensation trusts, and creating LPAs. I also assist in the family department, in particular in children’s proceedings and financial proceedings.

What is the best thing about your job?
I really enjoy meeting a wide range of clients and assisting them in creating a will that they are happy with and suits their personal circumstances. Every single matter that I deal with is different and I enjoy the challenges that brings.

Name the person who has been the biggest influence on your career.
My parents as they have been very supportive and made it possible for me to pursue a career in the law. They are always the first people I speak to when I have a decision to make about my career.

If you were not a lawyer, what would you be doing?
I think I would have enjoyed being a teacher.

For more information on Laura and her work, please visit:
http://www.dbf-law.co.uk/our-people/laura-johnson/

DeBrieF OPINION

Charlotte Fielding – a solicitor in our dispute resolution team – on why it’s so important to avoid will disputes and what steps you can take…

We have seen a steady increase in will disputes which is why we were not surprised to read about a recent case in the High Court involving a 47-year-old woman who has been left out of her mother’s will in favour of her brother.  http://www.telegraph.co.uk/news/uknews/law-and-order/10646282/Woman-waited-for-mother-to-die-for-inheritance-court-hears.html

She is challenging the validity of the will and is also claiming that she is entitled to “reasonable provision” from her mother’s estate. She claims that she is unable to work and therefore was financially dependent on her late mother, despite her being an adult. The defence argues that she has done nothing to find work for many years, as she expected to receive a share of her mother’s £200,000 estate. She also didn’t support her mother in her final years, whilst her brother visited their mother regularly and cared for her.

The decision in this case is expected at a later date, but it is a clear example of how feuds can arise following the death of a family member when it is often too late for the deceased to explain exactly what their wishes and intentions were. Our solicitors in the litigation department are experts on such disputes and are able to guide clients when such a conflict arises.

However, there are things that you can do during your lifetime to minimise the risk of these kinds of disputes….

One of the most common reasons for a dispute is that someone claims they should have been provided for in a will. You are entitled to leave your estate howsoever you wish and you may have personal reasons why you do not wish to include someone in your will. For example, if you have children, you may feel that one child has received more money from you during your lifetime or that one child is in more need of financial support after you have passed away. Or, as is the case above, you may feel that you want to leave one child more money as an acknowledgement for the all the care and support they have provided for you.

The law does not say that you must leave your estate equally to your children, grandchildren or parents, but if you do wish to leave your estate unequally then it is crucial that you supplement your will with a Letter of Wishes setting out your reasons and motivations for leaving your will in the way that you have. A Letter of Wishes can be updated easily and as many times as you like without having to go through any particular formalities. You may choose the wording and it can be as personal as you like.

If you choose to leave some money in a trust then you can leave guidance in your Letter of Wishes about how you would like your trustees to use the money. A Letter of Wishes is not binding, but it is clear guidance about your wishes and motivations and if a dispute did ever arise then it would be valuable evidence to defend any claim. A judge would give considerable weight to a Letter of Wishes clearly setting out reasons for leaving their will in a particular way and a judge would therefore be less likely to deviate away from what it states.

As we advise you in creating a new will, we will discuss all of your personal and financial circumstances with you to ensure that we reduce the risks of disputes or claims arising after your death. Whilst you go through the process, we also recommend that you do have conversations with your family members to explain why you intend to leave your estate in a particular way so as to draw out any potential issues now rather than after your death.

For more information on Charlotte and her work, please visit:
http://www.dbf-law.co.uk/our-people/charlotte-fielding/

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