Many people have heard of the expression Lasting Power of Attorney – the ability to appoint someone to make decisions in the event of an individual becoming incapacitated. Plymouth solicitor Lucy Atwill says that many firms need to make similar arrangements to protect their businesses as well.
Lucy, who heads the Wills and Probates department of Whiteford Curtis Crocker Solicitors, says a business Lasting Power of Attorney, or LPA, can protect a company’s assets in the long or short term.
“A lot of business owners don’t realise what problems could arise if there isn’t a LPA in place,” says Lucy. “If they have to obtain a Deputy Order in order for the business to survive, it could take between four and six months.
“There could be catastrophic effects if one of the owners of the business lost capacity. The bank may withdraw any planned funding or even call in a loan. Contracts not signed might not go ahead or if a partner signed a contract while they had impaired capacity it is still enforceable.
“It can affect staff, customers, contracts – a whole host of things. Anyone could have a stroke or an accident. There are any number of things that could go wrong and not just due to age.
“A business LPA could allow the business to run on, ensuring that anyone appointed to run the business has the relevant skills, knowledge and qualifications to act in your stead. LPAs are important to avoid risk,” says Lucy.
“With a business LPA in place decisions can be made if there has been a life-changing event. If it is temporary – say after a car accident – we can get them unregistered. It is a question of better safe, than sorry.”