Business Lasting Power Of Attorney

• Published date: 06 November 2020
• Subject Matter: Finance and Banking, Family and Matrimonial, Financial Services, Wills/ Intestacy/ Estate Planning
• Law Firm: Hill Dickinson
• Author: Fionnuala Kenny and Barry McDonough

A lasting power of attorney (LPA) is a legal document which gives another person of your choice the ability to make decisions on your behalf. Despite belief to the contrary, a LPA is not only for personal assets. It may also be in the best interest of a business owner to protect themselves in the same way.

Shareholders, partners and sole traders are some of the most common business owners who can benefit from appointing an attorney. Should a business owner become incapacitated by injury or illness, would someone be able to take over the running of the business and its finances? If not, fundamental business operations may not be possible. This can have adverse consequences for a business owner's family finances if they are reliant on income from the business.

The implications of not appointing an attorney may be devastating for any business. In that case, an application would need to be made to the Court of Protection to appoint a deputy. This process could take up to nine months and comes with a financial burden far greater than the cost of putting a LPA in place. During the interim period, the business may suffer with no one in a position to manage its finances and day-to-day operations. Business owners may not be able to rely on family or employees to run the business, as they may not have the legal authority to do so.

Business LPAs can also be useful for business owners who travel a lot...