A business LPA specifically differs
from personal LPAs because
it will be tailored according to
the business and considers its
articles of association along
with shareholder agreements or
partnerships agreements.
You can put an LPA in place for your business should you become unable to make
decisions due to unavailability i.e. holidaying abroad, illness, accident or simply due to a
loss of capacity. The power vested in your chosen attorney would allow them to continue
running the business, paying salaries to staff, sign cheques, access the business account
or even pay bills.
A business can either be run in the capacity as a sole trader, partnership or even a limited
company. Let’s look at each of these in more detail.
Sole Trader
In this instance, it is likely
that the business is owned
and therefore controlled
by you. If you do not have
provisions put in place in
the event of loss of capacity
or simply because you are
unable to make a decision
due to illness or injury, no
one will be able to continue
to make important business
decisions on your behalf
unless you have an LPA in
place.
Partnership
If the business is set up as
a partnership, there may be
a partnership agreement
in place which determines
what happens if you are no
long able to make decisions.
It is advisable to check for
this first before an LPA is
drawn up first to prevent
any conflict between the 2
documents.
Limited Company
If you are a director of a
Limited Company, you will
have articles of association
in place which again could
contain certain provisions
with regards to what could
happen if you or another
one of your co-directors
becomes
incapacitated.
Again, you should check this
first before making an LPA
to ensure both documents
do not conflict with one
another.
So how do you go about making an LPA for your business?
Quite simply, you would use an LPA for Property and Financial Affairs but ensure this LPA
only deals with business decisions so, for example, “My attorneys only have the authority
to use my business accounts and make decisions relating to my business. They are not
permitted to use my personal account or make decisions about my personal finances.”
This means that in your personal LPA you would specify “My attorneys only have the
authority to use my personal bank account. They are not permitted to access my business
account or make any decisions relating to my business.”
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