An Overview of The Lasting Power of Attorney

JTJB Legal Update November 2014

The Lasting Power of Attorney (LPA) has received widespread attention from the public lately due to two high profile legal tussles.

One case was between former China tour guide Yang Yin and the niece of wealthy widow Madam Chung Khin Chun, 87, over her estimated $40 million assets. The other case centred on the former boss of SA Tours, Mr Ng Kong Yeam, 75, and involved allegations by his family in Malaysia that his signature had been forged by Madam Kay Swee Pin to get the LPA.

Many asked why make a LPA whilst others questioned whether adequate safeguards have been put in place to ensure that a beneficial legal document did not become a tool for abuse and exploitation.

What is an LPA and its Benefits

The LPA was made possible by the Mental Capacity Act (Cap 117A), which came into effect in March 2010. The LPA allows a choice of a trusted person(s) to automatically step forward to act on a person’s behalf if that person should lose mental capacity without the need to apply to court for appointment of deputies, which is onerous and costly. It also provides certainty and peace of mind for the person and his or her loved ones. This becomes increasingly important as the risk of supervening mental incapacity grows through longevity, illness or accident.

Safeguards and Protection

A) The Code of Practice, Mental Capacity Act (The Code)

The Code applies to everyone who deals with a person lacking mental capacity, including Donee(s) under a LPA.  It provides guidance for people to:

  1. Understand their responsibilities and rights under the Act;
  2. Be aware of best practice in caring for persons lacking mental capacity and follow those practices.

The Code imposes restrictions on both Personal Welfare Donee(s) and Property & Affairs Donee(s) when exercising their powers.  Section 26 of the Mental Capacity Act also provides a list of excluded decisions which a Donee shall not make for or on behalf of the Donor under any circumstances.

B) The Certificate Issuer

The Certificate Issuer can be a:

  • Medical practitioner accredited by the Public Guardian;
  • Practising lawyer; or
  • Registered psychiatrist

The certificate issuer must certify that when the LPA was made:

  1. The Donor understood the LPA and its scope,
  2. The Donor was not induced by fraud or undue pressure to create the LPA, and
  3. There is nothing else that would prevent the LPA from being created.

The Certificate Issuer shall ensure the above by assessing the Donor objectively.

C) The Public Guardian

Examples of duties of a Public Guardian include:

  1. Maintaining a register of LPAs;
  2. Dealing with representations and  complaints about the way in which Donees are exercising their powers;
  3. Dealing with representations and complaints regarding the way money is being spent on expenditure for necessary goods and services;
  4. Investigating any alleged violation of any provision in the Mental Capacity Act;
  5. Initiating court proceedings to protect a Donor.

To encourage individuals to report on suspected ill-treatment to the Public Guardian, the Mental Capacity Act provides whistle-blower protection to protect the whistle-blower’s identity.

D) The Donor

The Donor should consider very careful when choosing his/her Donee(s).  There is no hard and fast rule in doing so but one should bear in mind that the responsibilities of a Donee are significant and it is best to appoint someone who is responsible, capable and trustworthy to take on the role.

The LPA is still a relatively new framework in Singapore and therefore will take time to mature. Notwithstanding the two recent cases, with an aging population and increasing levels of singlehood, making a LPA is encouraged to alleviate the stress and difficulties faced by loved ones should a person lose his or her mental capacity.

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

This update is for general information only and is it not intended to constitute legal advice. JTJB has made all reasonable efforts to ensure the information provided is accurate at the time of publication.

Contributed by:

Branda LaiAssociatebrandalai@jtjb.comBranda is pending her admission to the Singapore Bar. She is currently a Conveyancing Associate mainly handling sale and purchase of residential properties, mortgage and CPF work.