Just a short post, but possibly very important. At our recent BPR (Business Property Relief) Masterclass in Bournemouth, we had an expert IFA and an expert lawyer speaking, and both of them hit on an issue that caught some of the advisers in the audience by surprise.

Where a lasting or enduring power of attorney is in place, it should specifically authorise the attorney to engage a discretionary investment manager (DIM).

One of the benefits of BPR solutions is that they are much easier for attorneys to implement than conventional estate planning options, which require the attorney to get the court of attorney’s permission to gift money away.

However, it seems that anyone considering this should carefully check the wording of the power of attorney to make sure that they have permission to delegate their responsibility to a third party DIM.

And in fact this would apply to any DIM arrangement, even if it is not related to BPR.

There was some debate about what the interpretation of the law would be if the DIM arrangement was already in place, but the consensus was this would be ok as the client had presumably already consented to delegate to the DIM before losing capacity. However, this could possibly become contentious if the attorney wanted to make changes to the arrangement, such as appointing a new DIM.

Food for thought. For more information on all aspects of BPR, download a complimentary copy of our 2016/17 BPR Industry Report here