Business Lasting Power of Attorney
Protecting business continuity if you are unable to make decisions.
What happens to your business if you lose capacity?
Many business owners plan for death. Far fewer plan for incapacity.
If you lose mental capacity, you may still be a director, shareholder or key decision-maker. But without proper authority in place, your colleagues, fellow directors or family members may not be able to act on your behalf.
A business lasting power of attorney allows you to appoint someone to manage your business interests if you are unable to do so yourself.
It is a practical safeguard for continuity.
Why a personal LPA is not always enough
A standard property and financial affairs LPA may grant broad authority over personal finances. However, it may not be appropriate, or desirable, for that same authority to extend to business operations.
A business LPA allows you to:
- Separate personal and business authority.
- Appoint a different attorney for business matters.
- Limit authority to defined commercial functions.
- Align decision-making with shareholder or partnership agreements.
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What authority can a business lasting power of attorney cover?
Depending on how it is structured, a business LPA may allow your appointed attorney to:
- Manage business bank accounts.
- Sign contracts.
- Deal with suppliers and customers.
- Exercise voting rights.
- Make operational decisions.
- Oversee financial management.
The scope of authority must be carefully drafted to reflect your role and business structure.
Your business lasting power of attorney should align with governance documents
A business lasting power of attorney should not be prepared in isolation. It should be considered alongside the company’s governance documents, including articles of association, shareholder agreements, partnership or LLP agreements and banking mandates.
Any authority granted under the LPA must work in practice within the existing governance framework so that decisions can be made smoothly if circumstances change.
Why capacity planning matters in business
Incapacity can create immediate uncertainty:
- Directors may be unable to meet quorum requirements.
- Bank mandates may not permit alternative signatories.
- Shareholder decisions may stall.
- Contracts may be delayed.
Without a business lasting power of attorney, colleagues may have no lawful authority to act in your place. Deputyship through the Court of Protection is rarely a practical commercial solution. Planning ahead protects stability.
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Why specialist advice matters.
Our private client solicitors regularly advise business owners, directors and professionals on lasting powers of attorney and wider estate planning.
As a Lexcel-accredited law firm advising clients across London and the South East, we ensure these arrangements work alongside existing personal and business structures.
At Thomas Mansfield Solicitors, we ensure:
- Authority is limited appropriately to business matters.
- The LPA aligns with company documents and governance arrangements.
- Decision-making powers are clear and workable in practice.
- The document complies fully with legal requirements.
- Registration is handled as part of the overall planning process.
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Safeguarding your business interests.
For business owners and directors, incapacity planning is as important as succession planning.
A carefully structured business lasting power of attorney ensures the right people can manage business affairs if circumstances change.
Speak to our private client team about putting the right arrangements in place.
Frequently asked questions
Can authority under a business LPA be limited?
Yes. Authority can be restricted to specific business interests, such as managing bank accounts, signing contracts or exercising voting rights. It can also be drafted to exclude certain decisions. Striking the right balance is important - authority should be sufficient to maintain continuity, but not so broad that it creates unnecessary risk.
Can I appoint a different attorney for business matters?
Yes. Many business owners appoint a co-director, senior colleague or professional adviser rather than a spouse or family member. The person chosen should understand the commercial realities of the business and be able to act confidently if required. Separating personal and business attorneys reduces the risk of conflict and ensures decisions are made by someone familiar with the company’s operations.
Do I need a separate business lasting power of attorney?
In many cases, yes. A personal property and financial affairs LPA may technically extend to business interests, but that does not mean it is appropriate. You may not want a family member to have authority over company decisions. A separate business lasting power of attorney allows you to appoint someone with commercial understanding and restrict authority to defined business matters, providing clarity for fellow directors, shareholders and banks.
Does a business lasting power of attorney override company documents?
No. A business LPA must operate within the framework of the company’s articles of association, shareholder agreement or partnership documentation. It does not override those documents. Careful drafting ensures the authority granted under the LPA aligns with existing governance arrangements and can be exercised effectively in practice.
What happens if a director loses capacity without a business LPA?
If no authority is in place, fellow directors or shareholders may have limited ability to act on that individual’s behalf. Bank mandates may restrict access, quorum requirements may be affected and key decisions may be delayed. An application to the Court of Protection for deputyship is possible but can be slow and commercially disruptive. Advance planning avoids this uncertainty.
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Please note we cannot offer legal aid.