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Lasting Power of Attorney in Singapore - A Complete Guide
What is Lasting Power of Attorney and why should you make one?
Last week, an extensive debate was held in Parliament over the issue of Lasting Power of Attorney. Multiple Members of Parliament (MPs) and representatives of government ministries spoke at length about various concerns.
The central problem is that, with an aging population, the number of dementia cases have risen in Singapore over the years, leading to a increased number of people who have lost their mental faculties to make decisions – particularly important legal decisions – for themselves. Having people draw up a Lasting Power of Attorney (LPA) is seen to be the most direct solution, and there has been a steady rise in the number of people who registered LPAs from 2,681 in 2014 to 21,552 in 2020. However many people still do not have an LPA and there is an expected 40,000 LPAs by the end of this year.
This post will provide you with a complete guide about what an LPA is and why it's necessary, how much one costs, and what are some of the risks associated with not having an LPA in place.
What is Lasting Power of Attorney (LPA)?
A Lasting Power of Attorney (LPA) is a legal document that allows a person who is at least 21 years of age (aka a donor), to appoint one or more persons (known as the donee or donees) to act and make decisions on their behalf in the event that they have lost the requisite mental capacity.
This can happen due to a stroke, a mental illness, or even an accident. Under the Mental Capacity Act, It does not matter whether the impairment or disturbance to the donor’s mental capacity is permanent or temporary, although the LPA can be revoked if said mental capacity returns.
A donee can be appointed to act in areas either relating to the donor’s personal welfare or to the donor’s property and personal affairs. As such, this person ought to be someone who is trustworthy, reliable, and competent.
Why get a Lasting Power of Attorney?
Making an LPA provides certainty and peace of mind since the donor has the knowledge that a trusted and competent proxy decision maker will be able to step in to manage his affairs in his best interests.
Without an LPA, a court order would have to be obtained in order to administer the affairs of a person who lacks mental capacity. This court order is one where the court appoints a person to be the court-appointed deputy to manage the affairs of the person who lacks mental capacity.
This can be both a time-consuming and expensive process. Additionally, where a deputy is appointed, you do not get a say in who is appointed to act for you, unlike an LPA.
Mental incapacity is the inability to appreciate what you are doing, or know that it's wrong. Mental capacity may diminish over time because of illness and age.
The Mental Capacity Act, which was passed by Parliament in 2008 and took effect in 2010, outlines the rights of an individual who wishes to appoint another person for decision-making should they lose their mental capacity.
A recent article published by the Singapore Medical Association indicates that one in ten people aged 60 and above are suffering from dementia.
How is Lasting Power of Attorney (LPA) different from Will?
A will operates only after the will-maker’s death. By contrast, an LPA comes into effect only after the donor loses his mental capacity but loses its validity if the donor dies.
Obviously, this is because there are no decisions that can be made on behalf of a deceased person. Any matters to be settled, such as the distribution of assets, will be done so according to the terms of the deceased’s will, or the laws of intestacy if there is no will. An LPA has no authority over these matters.
Who can be a Donee?
A donee must be at least 21 years old and must be someone who has not been declared bankrupt.
A donor may also opt to elect a professional donee. These are individuals or organisations that can act as a donee on a paid basis. Examples include lawyers and social workers. Professional donees cannot be related to the donor by blood or marriage.
Duties, Responsibilities, and Powers of A Donee
The donee, in the exercise of his powers conferred by the LPA, must act “in the best interests” of the donor, as defined in section 6 of the Mental Capacity Act. This can be subject to assessment and investigation by the Office of the Public Guardian (OPG), a government organisation that is responsible for administrating the Mental Capacity Act.
In addition, there are two LPA forms to choose from when drawing up an LPA.
LPA Form 1 is the standard version of the form, which grants general powers with basic restrictions to the donees. These restrictions include those which are set down by statute, specifically sections 13 and 14 of the Mental Capacity Act, to limit the authority of a donee. These restrictions pertain to:
· 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
Under section 15 of the Mental Capacity Act, the donee's power is revoked if the donor is recovered from his or her mental incapacity.
However, the court has the power to repeal the LPA in cases where:
· Pressure or fraud to the donor for the LPA; or
· The donee's behavior would harm the donor's interest.
When will the LPA or the donee's powers be cancelled?
If a donor recovers his mental capacity, he may apply to revoke the LPA. The steps to do so are as follows:
1. Complete and sign a revocation form
· This is a requirement of the Mental Capacity Regulations (S105/2010).
· If you fail to do so, your donee(s) may continue to make decisions on your behalf in the event you lose mental capacity, without knowing the LPA had been
· Your donee(s) must sign the acknowledgment in the revocation form to satisfy the Public Guardian that you have given them notice of the revocation. If you
are unable to obtain your donee(s) signatures, you may attach other evidence, such as registered mail receipts to prove that you had notified your donee(s) of
your intention to revoke your LPA.
· This is a requirement of the Mental Capacity Regulations (S105/2010)
· Submit the following documents to OPG by post* or email:
· the completed and signed revocation form;
· (*by post only) your original hardcopy registered LPA (for LPAs received by OPG for registration before 1 Aug 2019) and copies thereof that you and your donee(s) may have for cancellation and destruction by the Public Guardian;
· (*by post only) your new LPA application, if any. OPG strongly encourages revocation of the existing LPA only upon registration of the new LPA, instead of an immediate revocation, so that arrangements made under the original LPA remain in place for your benefit until the new LPA is in place;
· a photocopy of your ID.
· Where fraud or undue pressure was used to induce the donor to create the LPA; or
· Where the donee behaves is behaving or proposes to behave in a way that would contravene his authority or would not be in the donor’s best interests.
Applying for an LPA
o # LPA Form 1 - Common Standard Powers with limitations to be granted to the Dronee(s)
o # LPA Form 2 - Customise Powers with limitations to be granted to the Dronee(s) for personal welfare and property
A lawyer is needed for Form 2.
Step II – Form Certification
- To confirm that the donor does have knowledge of the consequences but also gives consent for this document to be executed for the purpose of LPA.
- Also confirming the free consent without any influence or fraud.
- The LPA certificate must be signed off by a practicing lawyer, psychiatrist, or certified practitioner physician.For the case of Form 2, the same lawyer drafting the customised power can also do this.
- There is a fee for the LPA certificate issuer.
Step III – Registration of the LPA Application
For the LPA to be valid, it needs to be registered. To do so, the LPA form must be mailed to the OPG within six months from the date it was signed.
The Office of the Public Guardian has waived the $75 fee for Singaporeans who are applying for a LPA through Form 1 until March 2023. However, the fee with Form 2 is $200.
The Fees for Singapore Permanent Residents is $100 with Form 1 & $250 with Form 2. For Foreigners the fees are $250 with Form 1 & $300 with Form 2.
This process is currently slated to go digital, pending approval from Parliament. If approved, those wishing to make an LPA will be able to do so by logging in via Singpass to a new electronic system, the Office of the Public Guardian Online (Opgo). The donor can draft the LPA Form 1 online, filling out details of the donee and powers to be granted.
Donees will receive an SMS or e-mail notification, after which they can log in to Opgo via Singpass to accept the LPA without the need for a witness or red seals.
Once the donee accepts, the donor will then visit the certificate issuer to digitally sign the LPA before the issuer certifies and submits it on the donor's behalf through Opgo. Donors and donees will then be notified by SMS or e-mail about the registration status of the LPA.
To activate an LPA, a registered doctor must first examine the donor and then issue a medical certificate that certifies the condition of the donor’s mental health. This medical certificate is known as the Medical Report Form for LPA Transactions. The doctor will require the LPA to be furnished before the medical certificate will be issued.
Subsequently, the relevant institution may be approached to carry out the desired transaction. The LPA document, or a certified true copy of it, will be required along with other documents that the institution may request for.
Upon receiving the required documents, the institution will check with the OPG on whether the LPA is valid. If the LPA has been confirmed to be valid, the transaction will be carried out on the donor’s behalf.
The witnesses for the donee(s)/replacement donee(s) can be any persons other than the donor or donee(s)/replacement donee(s) of the same LPA. The witnesses should be 21 years old and above.
There is no requirement for the donee to be present when the certificate issuer witnesses and certifies on the LPA. However, some certificate issuers may prefer that the donees are present. Hence, it would be best to check with the certificate issuer beforehand.
The LPA is a deed, which is a legal document. It is currently a legal requirement under common law for a red seal to be affixed on certain deeds, including the LPA. This seal allows the LPA to be relied on by third parties when the donee acts on behalf of the donor when the latter loses mental capacity.
Currently, an applicant may pay for
· an LPA application,
· an application to cancel an LPA,
· an application to conduct a search of LPA, and
· a request for a certified-true-copy of the registered LPA
Payment can be made via e-payment through OPG's e-services portal.
Apart from your revocation (termination) of your LPA, it will be cancelled or the appointment of the donee will be terminated in the following circumstances:
· you or your donee dies.
· your donee lacks mental capacity to act as a donee.
· your donee formally declines the appointment as a donee (see Disclaimer by a donee of a Lasting Power of Attorney (OPG Form D1)).
· there is a divorce between your donee and you, applicable if your donee is your spouse and you have not stated otherwise in your LPA.
· you or your donee becomes a bankrupt or if your donee is a licensed trust company, the company is liquidated, wound up, dissolved or under judicial management (Note: this applies to the property & affairs donee only).
· a Court order is made to cancel the LPA or your donee's powers – this can happen if your donee has not acted in your best interest.
An LPA can only be made by a person with mental capacity.
Parents of children with intellectual disability may apply to the Court to be appointed deputies if the children are likely to be still lacking in capacity after 21 years of age.
The parents may also apply to the Court to appoint successor deputies as future decision-makers for their children with intellectual disability in the event the parents are no longer around or are unable to make those decisions.