Lasting power of attorney and co-ownership agreements

A lasting power of attorney (fremtidsfuldmagt) is an important legal tool that can play a crucial role for homeowners and others with valuable assets. Its purpose is to make sure your wishes are respected if one day you can no longer make decisions yourself. This could be because of illness or old age, for example.

Many people benefit from creating a lasting power of attorney. If you own property together with others – in co-ownership (sameje), for example – or if your financial affairs are complex, it gives you extra peace of mind to know who will look after your interests.

Essentially, a lasting power of attorney lets you appoint one or more people to act on your behalf if you lose the ability to make your own decisions. The person you choose to represent you is known as your “attorney” (fremtidsfuldmægtig in Danish).

Imagine the following scenario: you own a house together with your partner. Suddenly you become seriously ill and lose the ability to make decisions. Without a lasting power of attorney, it could be difficult for your partner to deal quickly and effectively with important matters such as selling the property or changing financial agreements.

There are several misconceptions about lasting powers of attorney. A common one is that they are only necessary for older people. That is far from the truth: any adult can come to need one, whatever their age.

To some, the process of setting one up may seem overwhelming or unnecessarily formal, but with the right guidance and understanding you can avoid potential pitfalls. So always make sure your wishes are clearly communicated before any problems arise.

What is a lasting power of attorney?

A lasting power of attorney is a legal document that lets you appoint one or more people to make decisions on your behalf should you lose the ability to make them yourself. This could be because of illness, an accident or dementia.

The lasting power of attorney ensures that your personal and financial interests are looked after in line with your wishes. It therefore plays a significant role in managing both personal and financial affairs.

Many people choose to set up a lasting power of attorney early to protect themselves against uncertain times. It brings peace of mind to know who will take care of your affairs if you can no longer manage them yourself.

Imagine, for example, that you own a business. Should you suddenly become unable to make decisions, your attorney could keep the business running without unnecessary delays.

There are many situations in which a lasting power of attorney has made a big difference. An elderly couple, for example, might benefit from one when selling their home if they have become frail with age.

When you set it up, you can also clearly define the areas in which your attorney may act on your behalf – whether that is banking or decisions about your health.

Benefits of having several attorneys

If you are considering appointing several attorneys, there are a number of benefits. One of the most obvious is that the responsibility is shared. By having several people make decisions and handle your affairs, you reduce the burden on any one person.

Having several attorneys also brings different perspectives into the decision-making. This can lead to more considered and balanced decisions, as more opinions and experience come into play.

However, this approach also has potential drawbacks. With several parties involved, conflicts or disagreements can arise over the best way to act on your behalf. Clear guidelines and good communication between the attorneys are needed to avoid misunderstandings.

Before you choose this option, you should consider:

• Whether the people you have chosen already work well together.
• How decision-making should be structured between them.
• How any conflicts will be resolved without unnecessary delays.

Co-ownership agreement: securing your rights as a cohabiting couple

A co-ownership agreement (samejeaftale) is a legal agreement between two or more people who own a home together without being married. For cohabiting couples, it is an essential way to secure both parties’ rights and avoid future conflicts.

When you enter into joint ownership, it can be tempting to rely on mutual trust. But life can change quickly, which is why it is important to have clear guidelines for the ownership. A co-ownership agreement sets out exactly how the housing costs are to be shared, how decisions are made and what happens in the event of a sale or a disagreement.

Typical elements of a co-ownership agreement:

• Ownership: The first element covers the ownership shares. This part specifies each party’s percentage share of the property.
• Division of costs: How you plan to share the costs associated with the home, such as loans, maintenance and taxes.
• Decision-making: The agreement should include procedures for making decisions about major investments or changes to the home.
• Moving out or selling: What happens if one of you wants to move out? Should the home be sold? And how should the proceeds be divided?

Take an example: you and your partner buy a flat together. You have each put in a different amount from the start – perhaps because one of you had more savings than the other. A well-structured co-ownership agreement can set out the exact ownership shares and the rules for paying these amounts back if the home is sold or the relationship ends.

This way, you both protect your financial interests and minimise the risk of misunderstandings later on. The agreement can also include clauses on resolving disputes – which gives you peace of mind about the future.

With an agreement like this in place, you are in a stronger position both legally and financially – wherever life may take you.

Activating and changing a lasting power of attorney

Once you have created a lasting power of attorney, the next step is to understand how it is activated and how it can be changed if the need arises.

Activation: A lasting power of attorney only takes effect once it has been activated. This typically happens if you are no longer able to make decisions yourself because of illness or declining health. To activate the power of attorney, your attorney must submit a request to Familieretshuset (the Danish Agency of Family Law), which will assess whether the conditions for activation are met.

You should make sure you have the relevant documents ready for this process. These include medical certificates or other evidence of your state of health. Once the request is approved, your attorney has the right to act on your behalf.

Changes: If you want to make changes to your lasting power of attorney after it has been created – perhaps because your circumstances have changed – you can do so as long as it has not yet been activated. You can either make minor adjustments with an addendum to the existing document or create an entirely new power of attorney.

In both cases, the new documents must once again be registered with the notary and submitted to Fremtidsfuldmagtsregisteret (the Danish register of lasting powers of attorney). This ensures that all the legal formalities are met.

Working through these steps can seem complicated at first glance. But with the right advice from a lawyer, for example, and careful planning, the process can be completed without unnecessary stress or confusion.