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Legal News | 18.11.21

Running your business is none of your family’s business?

If you are a business owner and presume that your family members can step in to make decisions when you are unable to do so, you would not necessarily be correct.

Family members do not have the automatic right to make decisions on your behalf, so if you want to go on a long holiday or you have an accident, which restricts your ability to do your work, how can you ensure that business operations will continue as usual?

As we mentioned in our previous newsletter (https://www.wansbroughs.com/news-events/dont-put-off-until-tomorrow-what-you-can-do-today/), there are two types of Lasting Powers of Attorney (LPA): Property and Financial Affairs and Health and Welfare.

You may be aware that an LPA for Property and Financial affairs allows your attorney(s) to make decisions regarding your personal finances. They would have the ability to pay your bills, withdraw cash and even sell your house.

However, you may not be aware that an LPA can also cover decisions regarding your business affairs.

When appointing one or more attorneys, it is crucial that you choose people you trust. You may decide that the attorney(s) you trust and have appointed to deal with your personal financial affairs are also those whom you trust to deal with your business affairs.

However, as much as you may trust someone, you need to be confident that your attorney(s) will be able to handle your business affairs and you can rely on them to make executive decisions in line with your business’ objectives, aims and ethos. You may therefore prefer to have two separate LPAs to cover both scenarios, i.e. attorney(s) to deal with your personal finances and different attorney(s) to deal with your business.

Of course, any business LPAs would need to be considered alongside your business’ constitutional documents to ensure that no provisions conflict. It should also be noted that directors cannot delegate their duties unless expressly authorised to do so under a company’s articles of association. If you would like any further information or would like our assistance with preparing LPAs for you, please email wealth@wansroughs.com or get in touch with your usual contact at Wansbroughs.

 

Posted By Our Wills, Tax, Trusts & Probate Team