Under an LPA, the donor can name specific replacement attorneys that will step in to act in certain situations.
When the replacement attorneys step in will depend on how the original attorneys are appointed.
Replacing a sole attorney
Replacements attorneys will start acting as soon as the original attorney is no longer able to act (i.e. death, mental incapacity or disclaims).
Unless the LPA says otherwise, the replacement attorneys will act jointly.
Replacing attorneys acting jointly
Replacement attorneys will step in to act as soon as one original attorney is no longer able to act. The remaining original attorneys will no longer be able to act.
If multiple replacement attorneys are appointed, they will also act jointly, unless the LPA states otherwise.
Replacing attorneys acting jointly and severally
Replacement attorneys will step in as soon as one original attorney is no longer able to act.
The replacement attorneys will act jointly and severally with any remaining original attorneys.
This is subject to the LPA stating otherwise, for example the LPA may state that:
- Replacement attorneys are not to act until all original attorneys are unable
- A certain order is to apply to how the replacement attorneys replace the original attorneys. For example, an LPA appointing the donor’s son and daughter as attorneys and their son-in-law and daughter-in-law as replacement attorneys could state that the daughter-in-law is to replace the son when he can no longer act and the son-in-law replaces the daughter.
Replacing attorneys acting jointly for some, jointly and severally for others
In regards to the decisions being made jointly, the replacement attorneys will step in as one original attorney is no longer able to act. The remaining original attorneys will no longer be able to make these joint decisions. These would be made solely by the replacement attorneys who would also act jointly.
In regards to the decision being made jointly and severally, replacement attorneys will step in as soon as one original attorney is no longer able to act and will act alongside the original attorneys for these jointly and severally decisions. This is subject to the LPA stating otherwise as stated above.
What can’t replacement attorneys do?
Replacement attorneys cannot temporarily replace an attorney e.g. if an attorney is away on holiday. If the replacement attorneys step in, the change is permanent.
A replacement attorney cannot replace another replacement attorney. It is therefore not possible to have more than two levels of appointment on one LPA. The case of Office of the Public Guardian v Boff and another does suggest an alternative where a donor could make two LPAs. The first LPA would name the first two levels of appointment. The second LPA would name the next levels of appointment and include a restriction that it is conditional upon the first LPA no longer being operable. This of course would be a costly method around the restriction.
Replacement attorney arrangements can end up fairly complex, feel free to email the team if you have questions or if a client has a complex arrangement that you are uncertain about.