Setting up a Lasting Power of Attorney (LPA) ensures that someone you trust is able to manage your finances and make decisions on your behalf if you’re unable to do so yourself.
However, according to research by wealth management company Quilter, more than 20,000 LPA applications have been rejected every year since 2018, totalling almost 130,000 over the last five years.
Property and Financial Affairs LPAs are most likely to be rejected. According to the research, around 75,791 of this type of LPA were rejected, or around 45% more than the 52,057 Health and Welfare LPAs that were rejected.
The data also revealed the lengthy wait for applications to be processed. On average, it took 91.5 working days (over four months) for an LPA application to be registered and returned in 2022-23. The shortest period recorded was 20 days for urgent cases, and the longest was 983 days (about two and a half years) in a case that had to be referred to the Court of Protection.
The government is considering reworking the registration system for LPAs to streamline the process, but it is currently unknown if and when any changes will come into effect.
What is a Lasting Power of Attorney?
A Lasting Power of Attorney (LPA) is a legal agreement that essentially allows you to appoint someone to take control of your financial affairs and decisions around your health and welfare if you’re unable to do so yourself. For example, this may be as the result of an accident, or illness such as dementia that means you lose mental capacity.
The two different types of LPA in England and Wales are a Property and Financial Affairs LPA and a Health and Welfare LPA. The former allows your attorney (the person you appoint) to manage your bank accounts, investments and taxes, bills and sale of your home.
A Health and Welfare LPA, meanwhile, allows your attorney to make decisions about your health, such as what treatments you receive and whether you go into care.
You can learn more about how LPAs work in our article What is a lasting power of attorney and why do you need one?
Four common reasons why LPAs may be rejected
It’s really important that an LPA application is completed thoroughly and correctly to ensure that it’s approved.
Here are some common reasons that LPAs get rejected, so that you can ensure that your application goes through on the first pass.
1. Signing in the wrong order
It’s vital that a LPA is signed in the right order, as there are several signatures needed for its completion.
The first person to sign should be the donor – that’s the person setting up the LPA. The next person to sign is your witness.
After that, the next person to sign should be the certificate provider (usually a solicitor or somebody who has known you for over two years and can verify that you know what you are doing). The witness and certificate provider can be the same person.
Your attorney (the person you have nominated) signs next, as well as any replacement attorneys (backup nominees in case your preferred attorney cannot manage your affairs either when the time comes). Their signatures must be witnessed as well.
The final person to sign is then the person who is registering the LPA – either the donor or the attorney.
It may seem a small oversight, but getting the order of signing wrong could mean your entire application is rejected, so it’s absolutely vital that you stick to the rules.
2. Missing information
Most of us have at some stage filled in an application or document and missed something out, but it’s really important not to do this with an LPA. Any missing information – such as the signing date or a witness – will likely see your application getting rejected. Providing full names for all parties is really important too, including their middle names.
3. An incorrect witness
Some people cannot legally act as witnesses, and if they do so this could mean the entire application is rejected. For example, an attorney cannot also act as a witness to the donor’s signature, or vice versa.
However, if you have more than one attorney, they can witness each other’s signatures (though you will still need at least one other person to witness your signature as the donor).
The witness must also be over the age of 18, and they can’t witness online either – it has to be done in-person.
4. Contradictory instructions
If the instructions given for making decisions and managing your affairs in an LPA are considered contradictory and unworkable then the application is likely to be rejected.
For example, if your LPA says your attorneys should act “jointly and severally” (meaning they have equal decision-making power), you cannot also then say that decisions should be made by a majority vote, as these are contradictory statements.
Before submitting a LPA application, consider asking an attorney to check the document and ensure that it’s completed correctly. Of course, a solicitor can also complete the application on your behalf to ensure there aren’t any omissions or errors. You can also find guidance on completing an LPA on GOV.uk.
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