An LPA (Lasting Power of Attorney) is a document used to legally authorise a nominated person (your attorney) to make specific decisions for you.
Should you become unable to make business decisions due to ill health or incapacity, a business LPA will ensure the continuing management of your firm.
A common misconception is that LPAs are unnecessary and family members can handle decisions if necessary. In fact, family members do not possess this automatic right to make such decisions.
If you run a business, it’s worth considering what might happen to your firm in the event that you were not able to make essential decisions. From the inconvenience of being abroad to more serious circumstances such as accidents or incapacity, it’s worth putting a plan in place.
Consider who will sign cheques, authorise invoice payments or pay salaries on your behalf. Simply assuming that a colleague or family member has authority to make such decisions could put your business at risk.
If you find yourself unable to handle business decisions and haven’t made the provision of a business LPA, it could be necessary for an application to be made to the Court of Protection to appoint a deputy to act in your stead. This process can be both lengthy and costly, with no guarantee the deputy appointed would be an individual you would choose. During the waiting time, which can be over six months, your company might be left exposed.
Creating a business LPA avoids unnecessary disruption, safeguards your interests and should be an integral part of every businesses strategy for crisis management.