Many people have heard of Lasting Powers of Attorney for personal matters. Which allow you to give another trusted person the ability to deal with your finances and/or health decisions on your behalf. Most people, however, are not aware that you can also make Lasting Powers of Attorney in relation to your business.
Lasting Powers of Attorney relating to your business are the best way to protect your business and staff from various unforeseen events.
Given the need, would you choose to have the same person dealing with your business as you would your personal matters? What happens to your business if you lose mental capacity?
Sadly, any person could lose the ability to make decisions for themselves due to sudden illness or an accident. At the moment, this possibility is particularly evident with the effects of COVID-19 being seen all around the globe. The difficulty, should incapacity or illness effect you, is that there is no automatic right for any person, even a spouse, to deal with your affairs while you cannot. In a business context this can have some serious consequences. How would your staff or suppliers get paid? How would important documents be signed? Would your clients hear about it and move their business elsewhere?
A business Lasting Power of Attorney can be made in addition to a personal Lasting Power of Attorney. You can appoint one or more individuals to oversee the running of your business for a short or extended period of time. You can also choose to appoint replacement Attorneys so that, should something happen to the people that you have chosen, someone else will be able to act.
All business owners should put some thought into how their businesses would be able to continue to run if they were not able to carry out their usual tasks. Shareholders, partners and sole traders in particular would benefit from appointing a business Attorney.
The alternative to a Lasting Power of Attorney would involve someone making an application to the Court of Protection to request that they are appointed as your Deputy. This is extremely onerous and much more expensive than a Lasting Power of Attorney. Also, crucially, it takes much more time. In September 2020, figures indicated that the average time for such Deputyship application to be completed was 34.6 weeks. Imagine the impact on your business if it was not possible for anyone to run matters for the space of 34.6 weeks.
A business Lasting Power of Attorney could be a very important tool to you at some stage and should certainly feature in your business plan. We are able to offer you specialist advice on in this area. We can prepare the documents, register them and provide you with all of the relevant advice on matters, for example, who you can choose as your Attorney.
Please contact our Wills and Lasting Powers of Attorney department on 0191 605 3710 or at amy@toomeylegal.co.uk for more information.