Yes, it is possible to sell a property on behalf of someone else whilst acting under the power granted by a Power of Attorney. Provided the Power of Attorney grants authority to sell a property and that the owner of the property (‘donor’ of the Power of Attorney) is unable to sell the property themselves, you (as the ‘attorney’) can act on their behalf. The property owner may not be capable of selling the property themselves if they do not have the relevant capacity required for reasons such as old age, illness or disability.
This article will explain the legal requirements for selling a property under a Power of Attorney, as well as what the attorney is and isn’t allowed to do.
Can a Power of Attorney sell a property?
In order to legally sell a property, the Lasting Power of Attorney (LPA) or Enduring Power of Attorney (pre 2007 document before the LPA was introduced) must be registered at the Office of the Public Guardian and it must be in favour of property and financial affairs. Please note that a LPA in favour of health and welfare cannot be used to sell a property on behalf of the donor.
An attorney that has been granted this power is able to take care of the whole sale process, from instructing estate agents to signing contracts and completing the sale. It is essential that the attorney is acting in the best interests of the donor as per the Mental Capacity Act 2005.
Legal requirements for selling a house under a Power of Attorney
Firstly, it is essential to determine that the Power of Attorney gives authority to the attorney to manage the donor’s property and financial affairs and that the document has already been registered with the Office of the Public Guardian.
It is important to note that a Power of Attorney can take up to 16 weeks at present to be registered at the Office of the Public Guardian, so if this has not already been done it could delay the sale.
Lasting Powers of Attorney over property and financial affairs can be chosen to be used either straight away from registration or only when the donor no longer has mental capacity. This is an option given to the donor when making the LPA. It is important to consider that if the second option has been selected, the attorney will only be able to sell the property once a medical professional has deemed the donor to no longer has sufficient mental capacity to do this themselves. The solicitors dealing with the house sale will request evidence of a capacity report in this instance. If the donor does have capacity, the attorney can only act with the donor’s consent.
Please note that the donor must be alive in order to sell their property using a Power of Attorney. Once the donor passes away, the authority granted to the attorneys immediately ends. The Will is the legal document which then takes over with dealing with the administration of the estate.
What can a Power of Attorney not do when selling a house?
When dealing with a house sale, an attorney must act within the scope of the Power of Attorney. This means that they cannot continue to act after the donor’s death and that they cannot make decisions which do not align with the donor’s best interest. This includes timing of the sale, use of proceeds and who the buyer is.
The Power of Attorney document may contain specific instructions or limitations, such as not to sell the house unless absolutely essential, for example, to pay for care home fees. Attorneys must follow these directions strictly. The proceeds from the sale must go to the donor’s account and the money must only be used for the donor’s benefit.
The attorney must take care to avoid any conflicts of interest and must not misuse their authority for personal gain. Should this be the case, there is a risk of being reported to the Court of Protection and having all powers taken away as well as potential convictions.
Can a Power of Attorney sell the property to themselves?
An attorney generally cannot sell the donor’s property to themselves (or someone closely connected to them) without specific legal authority. This is because it creates a conflict of interest, and the attorneys have a duty to act only in the donor’s best interests.
In special circumstances, an application to the Court of Protection can be made. The court may approve the application if, on the evidence provided, the transaction is clearly in the donor’s best interests and the property is not undervalued.
How long does a Power of Attorney have to sell the property?
There is no fixed timeframe for how long an attorney has to sell a property, but their authority is only valid whilst the donor is alive, and it should be done with reasonable care, speed and diligence. An attorney must not unnecessarily delay the house sale, particularly if the donor needs the funds (for example, to pay care fees).
At Goughs, we are here to help you with the preparation of the Power of Attorney all the way through to the completion of the house sale. We are here to:
- Advise on Powers of Attorney and their implications
- Prepare and register Lasting Powers of Attorney
- Provide certified copies of the Powers of Attorney
- Deal with the house sale and house purchase
Our experienced Private Client team can walk guide you through the complexities of the Power of Attorney documents to ensure when the time comes for them to be used, all transactions can go ahead as smoothly as possible.
