N & Anor v E & Ors

These proceedings relate to E, who was born in 1933 and lives in London. She has an estate worth approximately £30,000,000.

The applicants are her daughter and son, N and S.

The first respondent is E herself, acting by her litigation friend, the Official Solicitor.

The second respondent, M, was formerly her carer.

The third and fourth respondents are Julian Korn and Ian Burman, both of whom are partners in Laytons Solicitors.

This judgment relates primarily to the costs of the proceedings and, in particular, whether M should be made to pay her own costs or whether they should be assessed and paid from E’s estate.

M’s costs are in the region of £11,000.

The judgment concludes with a brief discussion of how the court was able to salvage E’s preferences for medical treatment at the end of her life from the wreckage caused by the termination of the appointment of her health-care proxy. This aspect of the proceedings was uncontested and reflects the consensus of all parties.

On 11 December 2008 E executed a Lasting Power of Attorney (‘LPA’) for property and affairs and an LPA for personal welfare, in which she appointed her husband, D, and Julian Korn jointly to be her attorneys.

She also appointed two replacement attorneys, M and Ian Burman, and expressly stated that M was to replace D, and Ian Burman was to replace Julian Korn.

Both LPAs were registered by the Public Guardian on 24 March 2009.

E has suffered from Parkinson’s disease since 1999, and in 2006 she was diagnosed as having early stage dementia.

M was originally employed in 2000 to provide E with physiotherapy on a regular basis. Over time M grew personally close to D, which led to a serious deterioration in his relationship with his children, N and S.

In their application to the court the applicants claimed that between 2009 and 2011 D and M had restricted contact between them and their mother, and they produced statements from two witnesses who described instances in which M had physically abused both D and E.

The applicants also alleged that, in addition to emotional and physical abuse, M had financially abused D and E and had extracted several million pounds from them.

E’s husband, D, died in June 2014 and following his death the applicants were concerned that M now had unfettered control of the household and could physically abuse E.

Accordingly, on Monday 7 July 2014 they applied to the court for an order without notice:

There are technical problems regarding succession when attorneys have been appointed to act jointly, though there is no need for me to consider them in this decision. Suffice it to say that, in my opinion, the joint appointment of D and Julian Korn was terminated on D’s death, and the two replacement attorneys, M and Ian Burman, succeeded them as joint attorneys.

I heard the application on Wednesday 9 July 2014. Simon Taube QC appeared for the applicants and the order they sought was granted. A penal notice was attached to the order and M was required to quit E’s home forthwith. A further hearing was listed for 11 am on Tuesday 5 August 2014.

On Thursday 10 July 2014 there was a meeting between the parties at Laytons’ offices, at which:

Later that day S and his brother-in-law supervised M’s removal of her possessions from the property and she subsequently travelled to Florida.

On 15 July 2014 I made an order in which, having recited that the Official Solicitor was willing to act as E’s litigation friend, I directed that his costs relating to the proceedings were to be assessed and paid out of E’s estate.

The second hearing took place on Tuesday 5 August 2014 and was attended by:

At that hearing the court made orders:

The primary source of law on costs in Court of Protection proceedings is the Mental Capacity Act 2005, sections 55 and 56. Section 55(1) provides that “Subject to Court of Protection Rules, the costs of and incidental to all proceedings in the court are at its discretion.”

The secondary sources of law relating to costs in the Court of Protection are:

There are four rules that need to be considered - rules 156, 157, 158, and 159 – which refer to the person to whom the proceedings relate as ‘P’. These rules provide as follows:

In anticipation of the hearing on 5 August 2014, counsel for the applicants, Philip Jenkins, produced a written skeleton argument, in which he said as follows:

“Save for the costs of the 2nd Respondent, the Applicants’ position is that the costs of the parties should be assessed and paid from the 1st Respondent’s estate in the usual way, per rules 156 and 157. As to the 2nd Respondent’s costs, the Applicants invite the court to make no order as to costs for the following reasons:-

(1)

The Applicants have put before the court a strong prima facie case of physical, emotional and financial abuse by the 2nd Respondent against their elderly and vulnerable parents. The 2nd Respondent has chosen not to engage with any of those allegations.

(2)

The evidence of the history of the personal relations between the Applicants and the 2nd Respondent suggests it is fanciful to think that the 2nd Respondent would have agreed without more to relinquish all control and influence over E.

(3)

Moreover, in view of the evidence before the court, the Applicants were reasonable to fear that if they articulated their concerns with the 2nd Respondent, asking her to give up all control and influence, there was a real (not fanciful) risk that this could put their mother at risk (including by returning with her to Florida). They were reasonably entitled to take the view that they should err on the side of caution in their mother’s best interests.

(4)

The 2nd Respondent had already indicated to the 1st and 2nd Applicants that she intended to take the 1st Respondent back to Florida in the autumn of 2014.

(5)

The 2nd Respondent attended the meeting at Laytons Solicitors on 10th July and she indicated then that she had no intention of contesting matters. It was not until around 31st July that she decided to instruct solicitors, Charles Russell, to make a statement. However, the statement explains in few words that she is not contesting the application and then at rather greater length why the Applicants should pay her costs, presumably of the witness statement which is focused in large part on why she is entitled to her costs from the Applicant. The contents of that witness statement did not add substantively to the Laytons letter of 10 July 2014.

(6)

It is not without significance that a substantial proportion of E’s 60th anniversary jewellery purchased by D in February 2014 was in the 2nd Respondent’s possession (where it is thought to have been since at least the middle of May) after service of the court orders on 10th July 2014 plus a very valuable diamond ring belonging to E. These items were delivered up by the 2nd Respondent to US lawyers acting for the 2nd Applicant on 21/22 July 2014.

(7)

Overall, the idea that the 2nd Respondent seeks her costs of the application, as well as citing costs as a reason for not contesting matters, may appear rather odd in the context of the very considerable sums she has received. There is no real dispute that she has received at the very least $8-9 million of the family’s money since 2008. The Applicants regard the 2nd Respondent’s position in this matter as a deliberately personal attack on them for having finally faced up to matters in the best interests of their mother.

(8)

The Applicants therefore respectfully request that the court order in the terms or substantially in the terms of the draft.

M’s counsel, Jordan Holland, gave the following reasons why his client’s costs should be paid from E’s estate.

He noted that this case involves not only issues relating to E’s property and affairs, but also issues relating to her personal welfare, in respect of which different general rules apply. He suggested, however, that it would be inappropriate to apply rule 157 and apportion costs between the respective issues, and in support of this proposition, he referred to a judgment of mine, Re RC Deceased [2010] COPLR 1022, at paragraphs 60-62.

Mr Holland continued:

In her oral submissions at the hearing, E’s counsel, Ruth Hughes, said as follows:

I agree with Mr Holland and Miss Hughes that there is no point in attempting to apportion the costs between:

The origin of the general rule in property and affairs cases goes back to the decision of the Lords Justices in Lunacy in Re Windham (1862) 4 De G. F. & J. 53, following which the Lunacy Amendment Act 1862 conferred upon the court a wide discretion as to costs.

As both Mr Holland and Miss Hughes observed, the current rule 156 is largely a replication of the principles laid down by the Court of Appeal in Re Cathcart [1892] 1 Ch 549, with a few exceptions, such as a requirement in Re Cathcart, which does not appear in the Court of Protection Rules 2007, to have regard to the respective means of the parties.

By contrast, the general rule in personal welfare cases is of recent origin, dating from1989, and reflects the fact that most personal welfare cases are of a public law nature.

In this case, no public bodies, such as the National Health Service or a local Social Services authority, were involved, and the proceedings were essentially private law proceedings. Accordingly, it would be appropriate to apply rule 156 as the starting point.

Rule 159, which describes the circumstances in which the court may depart from the general rule, refers to the conduct of the parties both “before, as well as during the proceedings.”

As regards M’s conduct before the proceedings, the allegations that she physically, emotionally and financially abused D and E have not been put to proof, and are a matter for another court to determine in the context of any claim brought against her for the recovery of funds.

M’s conduct during these proceedings has been satisfactory and she has done what was required of her.

The applicants’ suggestion that M had launched “a deliberately personal attack on them for having finally faced up to matters in the best interests of their mother” is an exaggeration, which, in other circumstances, would have justified penalising them as to costs pursuant to rule 159(2)(d).

Having regard to all the circumstances, therefore, I order that the costs of all the parties be assessed on the standard basis and paid from E’s estate.

There was a novel point in these proceedings, which, as far as I am aware, has never been considered by the court before. This involved E’s advance decision to refuse treatment or, as she described it, her ‘Living Will’.

On 11 December 2008 E signed a Living Will in which she:

On the same day E executed an LPA for personal welfare, in which she repeated the treatment preferences set out in her Living Will, but it was not entirely clear which document she signed first; the LPA or the Living Will.

Section 25(2)(b) of the Mental Capacity Act 2005 provides that:

“An advance decision is not valid if P … has, under a lasting power of attorney created after the advance decision was made, conferred authority on the donee (or if more than one, any of them) to give or refuse consent to the treatment to which the advance decision relates.”

Section 9(2)(b) of the Act provides that:

“A lasting power of attorney is not created unless –

(a)

…

(b)

an instrument conferring authority of the kind mentioned in subsection (1) is registered in accordance with Schedule 1. ”

The advance decision was made on 11 December 2008 and the LPA for personal welfare, although signed by E on the same day, was not created until it was registered by the Public Guardian on 24 March 2009.

Accordingly, E’s Living Will was not valid because the LPA for personal welfare had been created after it was made and, as an unforeseen consequence of the attorneys’ disclaimer, there was a danger that the treatment preferences that E had expressed in both her Living Will and LPA would be lost and consigned to oblivion.

To remedy this the court made a declaration under section 26(4) of the Act, which, after reciting the events that had happened and the guidance that E had recorded in her LPA for personal welfare, stated: