Lasting Powers of Attorney: Can I Sell Property on Someone’s Behalf?

There are many reasons why a person might wish, or need, to sell their property; perhaps to downsize to a smaller house or to help finance residential care. This is easily done if the person is willing and mentally capable of dealing with the paperwork, admin and other demands of the sale. But what if they are not? If a close friend or family member is in this situation, it’s natural to want to help them, so can you act on their behalf to sell a property for them?

The short answer is yes; the longer (more helpful) answer is: yes, but how you go about it depends on the circumstances.

Several methods can provide the required authority to deal with your loved one’s financial affairs:

• A Lasting Power of Attorney (LPA): An LPA allows someone to be appointed as an ‘attorney’ to manage affairs on behalf of the person who granted the power. Most commonly, they are used when the person who has granted the power no longer has the capacity to deal with their own affairs.
• An Enduring Power of Attorney (EPA): An EPA is an older form of power of attorney. Since October 2007, it has been impossible to create any new EPAs, but ones made before October 2007 are likely still valid.
• Becoming a Deputy: a Deputy is someone appointed by the Court of Protection to manage a person’s affairs if they are incapable of doing so themselves.

Of these options, using an LPA is the most straightforward.

Your loved one’s mental capacity

The first question to ask is whether your loved one has the required mental capacity to deal with the sale themselves. The answer significantly affects the options open to you. Mental capacity, in the legal sense of the term, means having the ability to make decisions, which is layman’s terms means understanding information, retaining and considering it and then communicating a decision.

• If your loved one has mental capacity: Assuming other circumstances are preventing them from dealing with the sale themselves, the best way to proceed with selling a property on their behalf would be by using an LPA. Your loved one can grant an LPA for Property and Finance, appointing you as an attorney. Not only is this a good precaution against the possibility of your loved one losing mental capacity in the future, but it also allows the LPA’s terms to be suitable for the sale of the property. Depending on its terms, it is possible for an LPA for Property and Finance to be used by an attorney, even whilst the person granting it has mental capacity. Neither an EPA nor applying to become a Deputy are possible options if your loved one has mental capacity. Both of these other options require a loss of mental capacity before they can be used.
• If your loved one does not have mental capacity: This is perhaps the more common situation when conducting a sale on a loved one’s behalf. Mental capacity is required for someone to be able to grant an LPA so, if no suitable power of attorney already exists, your only option can be to apply to the Court of Protection to become a Deputy, or for an Order permitting the sale. Alternatively, if a suitable LPA or EPA was created whilst your loved one was mentally capable of doing so, this could be used as the requisite authority.

Using an LPA to sell your loved one’s property on their behalf

In order to sell your loved one’s property on their behalf, the following must be true:

• You have been appointed as an attorney under the LPA and its terms allow you to deal with the property and financial affairs of your loved one
• The LPA has been registered with the Office of the Public Guardian
• The sale of your loved one’s property is in their best interests
• If you are the only attorney appointed by the LPA, and you co-own the property with your loved one, a second ‘trustee’ needs to be appointed. This is a technical legal point and required to meet the requirements for receiving the sale proceeds.

If these conditions are satisfied, then you can conduct the sale on behalf of your loved one; there is no need to apply to the Court of Protection for consent to either the sale itself or the sale price. However, there are a number of practical ways in which the sale will differ from a more conventional one. Your conveyancer should be aware of these differences and discuss them with you.

Using an EPA

All of the same requirements applied to LPAs also apply to EPAs. Where you co-own the property with your loved one, and you are the only attorney appointed by the EPA, there is still the requirement for a second ‘trustee’ to be appointed. However, this is where the situation can become more complicated:

• If the EPA was created on or after 1^st March 2000, you can appoint another attorney yourself – provided the terms of the EPA do not restrict this right.
• If the EPA was created before 1^st March 2000 and the power was not registered (with the Office of the Public Guardian) before 1^st March 2001, then you will need to apply to the Court to make the relevant appointment.

Using authority as a Deputy

Instead of deriving authority to act from a power of attorney, a Deputy’s authority comes from the Court of Protection. This is useful if your loved one has lost mental capacity and no suitable powers of attorney exist. However, becoming a Deputy requires an application to the Court, which can be time consuming and there are also Court fees to pay. More information on becoming a Deputy can be found on our factsheets page (under the heading ‘Court of Protection’).

As with LPAs and EPAs, similar requirements apply if you wish to sell a loved one’s property as a Deputy:

• The Court order appointing you as Deputy must give you authority to make decisions regarding your loved one’s property and financial affairs and the specific authority to sell their property.
• The sale must be in your loved one’s best interests.

If you co-own the property in question with your loved one then you will have to make further applications to the Court to ensure requirements are met for the receipt of the sale proceeds.

Best interests

It is vital that any sale of your loved one’s property is in their best interests. Attorneys and Deputies are under a general duty to act in the best interests of those whose affairs they are managing at all times.

It can sometimes be difficult to determine what those ‘best interests’ might be. If there is any doubt over whether your actions as an attorney or Deputy meet this requirement, it is crucial that you seek independent legal advice. If necessary, an application for guidance can also be made to the Court of Protection.

The importance of having an LPA

Having an LPA in place is one of the best ways someone can prepare for any future inability to deal with financial affairs or health and welfare questions that may arise. If your loved one is in a position to do so, they should seek legal advice about the creation of an LPA. It could make issues in future much easier to resolve.

When selling a property on a loved one’s behalf, LPAs provide the most efficient way of achieving this with appropriate authority, avoiding the time and expense connected with one or more applications to court.

In addition, if you find yourself acting for a loved one in this regard, consider whether you should arrange an LPA for yourself, so that other family or friends can manage your affairs should you be unable to do so in future.