Case Study
Roger had just retired from his engineering job when he became mentally incapacitated at age 70. He was in the midst of selling his home and buying a smaller home. He was unable to perform the transaction because of his dementia. His daughter Sandra needed to complete the sale of the condo on his behalf and to access his bank account for subsequent transactions.
As Roger did not have an LPA, Sandra had to apply to be his deputy with a lawyer assisting with the application. The cost was $6,000 and it took 6 months for the deputyship to be approved.
Note: A deputy is an individual who is appointed by the court to make decisions for a person who has lost mental capacity and who did not have an LPA.
There are many excellent resources online on the LPA. The source of the most reliable information is the Office of Public Guardian (OPG) itself, which is the division of the Ministry of Social and Family Development (MSF) that oversees the administration and the integrity of the LPA. They have over the years greatly simplified the process of application and other procedures. To get going on your LPA, go to OPG’s website at www.msf.gov.sg/opg/ to print a copy of the latest LPA Form 1 and start filling it in.
Getting Your LPA Done
The process of getting your LPA Form 1 can be summarised as follows:
Applying for an LPA Form 1
You the donor who is at least age 21 and mentally capable would have to:
- Complete the LPA Form 1 application. It takes about 30 minutes to complete.
- Choose a Certificate Issuer to certify your mental capacity and intention to make an LPA
- Have the LPA registered with OPG
As the person making the LPA, you are the “donor” with powers to donate if you lose mental capacity. The persons you appoint to make decisions on your behalf should you lose mental capacity are the “donees”.
Comparing the Donee Roles
There are two types of donees – Personal Welfare Donees (PWD) and Property Affairs Donees (PWD).
Example Powers of the Donees
In the event you are certified mentally incapable, your donees have powers to decide on and act in your best interest.
Your PWD can decide on, among other powers:
- Where you should live
- Day to day care decisions (what to wear and eat)
- Who you may have contact with
Some matters your PWD cannot decide on for you include marriage, renouncing a religion and gifting of any body part.
Your PAD can decide on, among other powers:
- Buying, selling, renting and mortgaging your property
- Operating your bank accounts
- Paying household expenses
Some matters your PAD cannot decide on for you include executing a Will, and making a nomination on your insurance and CPF savings.
Choose your Donees Carefully
Given the wide-ranging powers that a donee has, you should be very careful who you choose as donee.
Case study
Former China tour guide Yang Yin was jailed for 9 years in March 2017 for cheating wealthy widow Madam Chung Khin Chun. After first meeting in 2006, the pair became close. Yang Yin moved into her bungalow with his family in 2008.
Madam Chung appointed Yang Yin to be her sole PWD and PAD in 2012. Madam Chung, who has no children, was diagnosed with dementia in 2014. In 4 years, Yang Yin drained her cash savings from $2.7 million to $10,000. In a 2010 Will, he stood to inherit all of the widow’s assets worth $40 million.
These are some of the most common choices that families make:
- Husband and wife appointing one another.
- A parent appointing a child.
- Siblings and relatives appointing one another.
Certain people such as singles and childless couples, who may not have family members or close friends to rely on, can consider appointing professional donees to act for remuneration. A list of professional donees can be found on the OPG website at www.msf.gov.sg/opg/Pages/About-PDD.aspx.
Sometimes, the choice of donee seemed right at the time but not so after a time. For instance, these may not be desirable situations:
- Frank appointed his wife Becky as his donee. Frank loses mental capacity while they are in the middle of divorce proceedings. His LPA is invoked with Becky acting.
- Betsy and Lindy are single and best friends. They appointed one another as donees. Lindy loses mental capacity a few years later. Betsy learns what a tough job it is to care for Lindy and she isn’t getting paid for the time she spends away from work to care for Lindy.
- Jackie appointed Michael her son as donee. When Jackie lost her mental capacity, Michael had just started a new job and a new family. He found himself unable to cope.
Making your LPA should hence not be a one-off exercise. Over the years you may get married, have children, get divorced, remarry, start a business, suffer a death in family and go through many other life events. When you experience major life events, you should review your LPA and other documents.
Conclusion
If you lose mental capacity and you did not make an LPA, you cause great inconvenience and stress to your family. Get your LPA done, sooner the better. The time taken and the cost are modest.
There is a higher likelihood of dementia as we age, so let’s be prepared just in case. Our families would be relieved we did.
