In this article we will run through an overview of lasting powers of attorney in Singapore. Should you need any additional advice or support in this area please feel free to get in touch.
What is a Lasting Power of Attorney (LPA)?
There are many types of powers of attorney and the Lasting Power of Attorney (LPA) is just one of them. There are over 43,000 Singaporean’s at time of writing, who have already applied for an LPA.
A Lasting Power of Attorney is a legal document made by a person (known as the donor), authorising one or more persons (known as the donee(s)) to manage the donor’s affairs if the donor loses his or her mental capacity.
It is advisable that a donor appoints a donee who is trustworthy, reliable and competent to act for him or her. The LPA is highly crucial for those who have health issues or who are the sole breadwinners of their families.
What is the meaning of Lacking of Mental Capacity?
A person is lacking of mental capacity if he or she is unable to make a decision for himself/herself due to an impairment of, or a disturbance in the functioning of, the mind or brain (Mental Capacity Act).
It is immaterial as to whether the impairment or disturbance is permanent or temporary.
A person could lose his or her mental capacity due to certain situations, for instance, getting dementia, suffering from a stroke, sustaining head trauma due to an accident etc.
Why a lasting power of attorney is important?
A lasting power of attorney acts as an early preparation to protect the donor’s interests that may become vulnerable one day.
It prevents the donor’s family from going through the hassle of applying for a Deputyship order from the court. If there is no LPA, a court order is required to be obtained for the purpose of managing the affairs of the one who loses mental capacity. The court will appoint a person to be the ‘court-appointed deputy’ to manage the affairs of the person who loses mental capacity.
Therefore, making a lasting power of attorney in advance will avoid the hassle of obtaining a court order, which is time-consuming and costly.
In addition, the person lacking mental capacity do not get to choose the ‘court-appointed deputy’ to manage his or her affairs.
What is the difference between LPA vs. Will
A Will comes into the picture only after the Will-maker has passed away. The LPA’s function is not for assets distribution after the Will-maker departed. The LPA comes into effect when the donor is still alive but loses his or her mental capacity to manage his or her affairs.
Who is eligible to be a donee?
A donee must be of the age of 21 or above and a person who has not been declared bankrupt. A donee who is appointed by the donor under the LPA is allowed to make decisions on behalf of the donor.
Donee’s Duties & Powers
The donee has the duty to act in the donor’s best interest (section 6 of the Mental Capacity Act).
In the LPA document, it is crucial for the donor to set out the limitations or restrictions, which limit the donee’s power.
The Office of the Public Guardian (OPG), a government body, is empowered to investigate any cases where the donee abuses his or her power and does not act in the best interests of the donor.
If the donor recovered from his or her mental incapacity, the donee will no longer have the power to manage the donor’s affairs.
The donee is authorised to manage the donor’s personal welfare, property and financial matters. The donor’s personal welfare matters are for example, where should the donor live and how the donor should be cared for. The donee is also authorised to access the donor’s bank account(s).
Statutory Limitations on Powers of the Donee
The limitations or restrictions limiting the donee’s power are in regards to the matters as follows:
- Limitation/Restriction to the donor
- Medical treatment or healthcare of the donor
- Nominations under the Insurance Act
- Execution of donor’s Will
- CPF funds
- Managing the donor’s property; and
- Making gifts out of the donor’s property
Revocation of a LPA
The LPA is revocable under certain grounds (section 15 of the Mental Capacity Act). Significantly, once the donor recovers his or her mental capacity, he or she can revoke the LPA.
Lifting of a LPA
Any person may apply to the court for lifting a LPA. The court is empowered to lift the LPA under the following grounds:
- Fraud or undue pressure/influence to induce the donor to make the LPA; or
- The done behaves, is behaving, or intends to behave, in such a way that he or she would abuse his or her power or would not be in the best interests of the donor.
If a donee abuses his or her power and exploits the donor, the donee may face severe penalties i.e. fine or imprisonment (section 42 of the Mental Capacity Act).
How to apply for a LPA
If you are looking to apply for a lasting power of attorney you can review the steps below. In various situations you will need a lawyer to assist in drafting and certifying documents. Please reach out if you wish to leverage I.R.B Law LLP in this process, we are experienced and highly affordable in this area.
Step 1 – Fill in Form 1 & Form 2
These 2 forms are retrievable from the Office of the Public Guardian (OPG) website.
- Form 1: Standard version that grants general powers with basic limitations/restrictions to the donee(s).
- Form 2: You need fill this form if you want to customise the donee’s powers. A lawyer is required to assist in drafting the wording of the donee’s power and the wording is to be attached to the Form 2.
Step 2 – Certify the Form
- This is to affirm that the LPA-maker / donor understand the LPA’s purpose and consequences.
- Also, this process ensures that the donor, in making the LPA, he or she is under free consent where there is no fraud or undue influence to induce the donor to make the LPA.
- Persons who can certify the form are: practicing lawyer, a psychiatrist, or an accredited medical practitioner. If a donor is filling in the Form 2, the lawyer he or she hired to draft the LPA’s powers can also do the certification.
- A fee will be charged by the person certifying the form.
Step 3 – Register your LPA Application
- Registration of a LPA is a must in order to make it valid and enforceable.
- The LPA is required to be submitted to the OPG.
- The OPG has waived the LPA application fee ($75) for Singapore citizens who make registration with Form 1 (until 31 August 2020).
- For registration with Form 2, the application fee is $200.
How to activate a LPA
In the situation where you need to unfortunately activate the LPA, you would need to follow these steps.
Step 1 – Get a Doctor to certify the donor’s mental capacity
- The donor’s mental incapacity needs to be certified by a registered doctor.
- The medical certificate (Medical Report Form for LPA Transactions) is retrievable from the OPG website.
- Please be reminded to bring along the LPA with you when you are bringing the donor to the doctor.
Step 2 – Go to the Relevant Institutions for the desired transactions
- At the relevant institutions, the donee is required to present the original LPA or a certified true copy of the LPA from OPG.
- Depending on the institutions, other documents may be required.
How can we help?
I.R.B Law LLP are experienced in advising on, and drafting lasting power of attorney documents as well as handling any dispute cases. Please feel free to contact us should you require any further support.