Q&As

Can an attorney appointed in a lasting power of attorney create a personal injury trust for the donor where the donor still has capacity?

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Published by a LexisNexis Private Client expert
Published on: 11 January 2024
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The scope of the attorney’s authority is subject to:

  1. •

    the provisions of the Mental Capacity Act 2005 (MCA 2005) and, in particular, sections 1 (the principles) and 4 (best interests) (MCA 2005, s 9(4)(b))

  2. •

    excluded decisions under MCA 2005

  3. •

    the provisions of any other enactment

  4. •

    the common law of agency and fiduciary duties, and

  5. •

    any conditions or restrictions contained in the instrument (MCA 2005, s 9(4)(b))

An attorney appointed by an LPA therefore has a wide power to do almost anything that the donor himself could do.

The creation of a trust would usually be an action which would be excluded by MCA 2005, s 12(2), being a gift, unless it falls within the limited exceptions. However, if the terms of the intended trust are sufficient

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