Losing one’s mental capacity or being involved in a serious accident is never a welcome thought, however, if you are the director of a company and your mental capacity is lost or diminished or you have become incapacitated due to a serious accident then you face a you face a very real issue with not being able to make appropriate decisions for either your own well being or the future success of your business. Perhaps the company or business can’t pay its electricity bill as you are the only signatory on the bank account?
In this regard, it is advisable to arrange an Enduring Power of Attorney regardless of your age. This will ensure that an appropriate and trusted person will be appointed to look after your affairs if god forbid you should suffer be in a serious accident or suffer from some form of mental incapacity such as brain damage, dementia or a stroke.
Mental Health is a very real issue in Ireland today. Whether this is a function of our modern lives or an underlying health issue exists, it is said that mental health has affected every family across our country. Mental illness, whilst upsetting for everyone involved, can happen at any age or stage of life leaving simple everyday tasks such as paying bills, managing financial affairs or performing fiduciary duties on behalf of your company impossible. By executing an EPA, however, you will have already decided who will look after your affairs and what powers your appointed attorney will have.
On a personal level this will mean your own personal well-being can be looked after and your family provided for, whilst for your business it will allow the day to day necessary duties and jobs to be relinquished to others within the company in a much quicker, easier and efficient manner.
Unfortunately, if you were to sadly lose your mental capacity or be in a serious accident and an EPA has not been executed in advance of this the only way in which your affairs could be managed is to be made a ‘Ward of Court’. The Court will then have the ultimate authority and power to deal with your assets and affairs. Generally, a Committee will be appointed to act on your behalf under the authority of the Court, however, whilst they will most probably be well intended, a Committee may not necessarily comprise of the people you would have appointed to look after your own affairs if you had of considered the matter whilst you were in good health!
It is important to note that an EPA cannot take effect until it has been proven that you have lost your mental capacity – not before! This will allow you to continue to manage your own affairs until the situation occurs. Hopefully the situation will never present itself and your EPA can be looked upon as something similar to an insurance policy taken out more as a protective measure. It is not something anyone would want to use, however, if it is needed, it is a reassurance to know it is there.
Examples of people who can act as your ‘Attorney’ including the following:
- A spouse;
- A cohabiting partner;
- A child; and/or, a friend.
To avoid the possibility of abusing an EPA the following safeguards are also in place and must be met:
- The attorney must register the EPA with the High Court through a specified office;
- You must be notified of the attorney’s intention to make the application;
the application must be based on a medical practitioner’s certificate confirming your mental incapacity; and
- The two or more notice parties, as named in your EPA must also be notified of the application to register the EPA.
- The notice parties, which also includes yourself, have a period of 5 weeks to object to the registration of the EPA.
As stated above, an Attorney will have the power to look after your personal care decisions. Personal care decisions are defined within the Powers of Attorney Act 1996 to include decisions on any one or more of the following matters, depending on the contents of the EPA:
- Where and with who you should live;
- What training and/or rehabilitation you should receive;
- How you should dress and your diet;
- Who you should see and should not see;
- Inspection of personal papers; and
- Dealing with benefits including social welfare and housing.
It is interesting to note that an attorney cannot make healthcare decisions on your behalf, although, it would appear there is a very fine line between personal care decisions and health care decisions.
Regardless of your age, perhaps we all, and in particularly business owners, should take some time out to think about the effect a diminished mental capacity would have upon us, our family and our business.
By obtaining legal advice and engaging in the process of ensuring you have a valid Will and an Enduring Power of Attorney in place, you (and your family) will be much better placed to face such extremely difficult circumstances with a bit less worry and complication.
Article attributed to Victor Clarke. Victor is the Managing Partner of Clarke Jeffers & Co. Solicitors and heads up the firm’s Family Business team.