Lasting Powers of Attorney are a great tool to help ensure that a trusted person is responsible for making decisions on your behalf should you lose mental capacity to make such decisions yourself. There are typically two types of LPA: health and welfare and financial.
As a business owner, partner or director in a business, it is essential to consider not only your personal finances but also the financial future of your business.
A Business Lasting Power of Attorney allows you to do just that. In this article, our experienced solicitors detail what you need to consider as a business owner when setting up your Business LPA.
What is a Business Lasting Power of Attorney?
Should you become incapacitated and unable to make decisions for your business, a Business LPA will assist you in protecting your business from risk as it has the ability to cover all manner of situations.
Your Business LPA will likely work as part of (or alongside) your Business Continuity Plan to ensure that the day to day running of your business may continue with minimal disruption.
Most businesses have a Business Continuity Plan. It covers all the essential procedures that must be followed in the event that any circumstance should prevent the business from operating in the usual way. A Business Continuity Plan may include provision for:-
- IT failure.
- Telecommunications failure.
- Flood.
- Fire.
- Freak weather conditions.
- Terrorism or other attack.
- Incapacity of key decision makers.
No two Business Continuity Plans are the same. Below, we outline likely situations depending on the structure of the business.
If You are a Partner or Director
It is common in larger businesses for a partner’s/director’s appointment to be terminated in the event they lose capacity. If your business does not have such a provision, a Business LPA may provide a suitable alternative, allowing you to appoint a proxy to act on your behalf should you lose capacity.
If you are a sole director, this is not so straightforward. However, a Business LPA may assist in ensuring that your wishes are made clear.
If You are a Sole Trader
In this case, as a legal entity, your business is not separate from you. As the owner, you should introduce a Business LPA to ensure that your business is protected in the event of your mental incapacity so as to avoid any unnecessary risk.
Lasting Power of Attorney Solicitor
At Beverley Morris & Co., our experienced private client solicitors, alongside our business law team, can assist you in creating either a Lasting Power of Attorney for yourself personally or your business, ensuring that your assets and interests are protected.
If you would like to find out more information about the implications of creating any Lasting Power of Attorney including a Business Lasting Power of Attorney, please call 020 8852 4433, email enquiries@beverleymorris.co.uk or fill in this contact form.