IMPORTANT NOTICE
This judgment was delivered in private. The judge has given leave for this version of the judgment to be published on condition that (irrespective of what is contained in the judgment) in any published version of the judgment the anonymity of the incapacitated person and members of their family must be strictly preserved. All persons, including representatives of the media must ensure that this condition is strictly complied with. Failure to do so will be a contempt of court.
MENTAL CAPACITY ACT 2005
IN THE MATTER OF P
First Avenue House
42-49 High Holborn
London WC1V 6NP
Before:
SENIOR JUDGE LUSH
Between:
THE PUBLIC GUARDIAN | Applicant |
- and - | |
H | Respondent |
Nadia Dhillon of the Office of the Public Guardian
The respondent in person and unrepresented
Hearing date: 6 May 2015
JUDGMENT
Senior Judge Lush:
This is an application by the Public Guardian for an order revoking an Enduring Power of Attorney (‘EPA’) on the grounds that, having regard to all the circumstances, H is unsuitable to be his wife’s attorney.
As the issue is “whether … an appointment should be revoked”, I am required by the practice guidance, Transparency in the Court of Protection: Publication of Judgments, [2014] COPLR 78, to allow this judgment to be published.
Paragraph 20(iii) of the practice guidance stipulates that “anonymity in the judgment as published should not normally extend beyond protecting the privacy of adults who are the subject of the proceedings and other members of their families, unless there are compelling reasons to do so.”
In this judgment:
P is the donor of the EPA and the subject of these proceedings;
H is her husband, the attorney;
D is her daughter; and
S is her sister.
I have also anonymised the name of one of other person, H’s lady friend, MQ. Although she isn’t a member of the family and although she is the principal villain of the piece, I have decided to protect her privacy in order to prevent the jigsaw identification of everyone else.
Background information
P is 74 and comes from an aristocratic family.
She has been married four times. Her present husband, H, is 79. They married in 1989 and lived together in Spain until she became incapacitated three years ago. He still lives there.
P has two children:
a daughter from her first marriage, D, who is 54 and also lives in Spain; and
a son from her second marriage, who lives in London.
On 8 October 1991 P signed an EPA, in which she appointed her husband to be her sole attorney with general authority to act on her behalf in relation to all her property and affairs.
In June 2012, P, who was an alcoholic, collapsed and was unconscious for five days. She has never regained the capacity to manage her property and financial affairs, but is still capable of making a few fairly basic decisions.
The EPA was registered by the Office of the Public Guardian (‘OPG’) on 12 March 2013.
Since February 2014 P has lived in a nursing home in Warwickshire and at present her care is fully funded by NHS Continuing Healthcare.
One of her sisters, S, who is 72, lives in the Cotswolds and visits her two or three times a week.
P’s free estate (which excludes any entitlement under a trust) consists of:
a current and deposit account with the NatWest, on which there is a balance of about £10,000; and
a half share of three properties in Andalusia, Spain, which she owns jointly with her husband, H.
Property A, in which H still lives, is worth about €210,000, but is mortgaged to the Icelandic bank, Landsbanki, which went into receivership in October 2008. H and P’s debt to the bank is now €342,000, which is substantially greater than value of the property. There is a group action in Luxembourg, mounted by the victims of the bank’s collapse, in which H and P are litigants.
Property B is worth about €500,000 and is free of mortgage. H and P originally bought it for €700,000, but the property market in Spain collapsed during the global financial crisis and has not yet shown any signs of recovery.
Property C is valued at about €220,000 and there is no mortgage on it.
MQ
Following P’s hospitalisation and admission into long-term care, H returned to Andalusia and became infatuated with MQ, a 42 year-old illegal immigrant from Iraq. His description of their relationship is remarkably candid.
“I was desperately lonely when P went into care so suddenly and I missed (and still miss her) terribly. My entire world was turned on its head with no warning. I was not given a chance to slow down, to downsize, or otherwise adapt my world to the new situation I was cast into. Considering this, surely it is natural when I first met a beautiful woman to be taken in, especially when she was so flattering and seemed to think I was wonderful.
When I met MQ, the dishonest long-term tenants had just vacated Property A, my daughter had just left, after staying in Spain to help, and I was standing entirely alone in a pigsty of a place without the faintest idea of what to do and no one to ask for help. MQ appeared and immediately helped me to make a plan of action, moved into the house and, within less than a year, she and her brothers, who have building experience, had transformed it. Soon after that, I moved in with her and vacated Property B, which was the house I had been living in with P for the previous three years or so.
Of course I am not blind to the fact that she comes from a very poor family. I am elderly and she is still young, and her priorities are bound to be her own future and that of her son. This is logical. All she has ever asked me for is a property in her own name. This I bought for her last year. I consented to spend no more than €100,000. We found a good flat in a nice area, and she has since redecorated it and done it up. She is now happy and wants nothing more.
The references in various places to her bullying me and my being vulnerable are exaggerated. She had a bad temper and this was occasionally directed at me, as it was to the rest of her family. Her temper has improved a great deal over the last year or so. She is certainly a forceful and assertive woman. Whether she bullies me or not is a matter of opinion. She does it caringly though and has never used physical violence of any kind.
Also she knows full well that P is my wife, and nothing will ever change that. There has never been any suggestion or expectation of marriage on her part, while P lives. In my email, I said that, if a civil partnership with MQ had been mentioned, it was merely because she needed a passport. Without a passport she is severely inconvenienced living in Spain and I naturally wanted to help her. She has always known it would not happen during P’s lifetime because while P is alive I am already married.
I admit I lost my head at the beginning because I was flattered at being wanted by someone of that age. But that was a long time ago and since then there has been a theft of money and broken promises. Remember, after being thirty years with one person, I was unprepared for someone new in this department and was briefly taken in. I would say I have learned my lesson in such matters now and am much less innocent. I would never be taken in this way again.”
The Public Guardian’s application
On 8 December 2014 the Public Guardian applied to the Court of Protection for:
An order under Schedule 4 paragraph, 16(4)(g) and sub-paragraph (5) of the Mental Capacity Act 2005 directing the revocation of the Enduring Power of Attorney and directing the Public Guardian to cancel the registration of the Enduring Power of Attorney made by P.
An order inviting a member of the panel of deputies to make an application for appointment as property and affairs deputy for P.
The application was accompanied by a witness statement made by Andrew Tovey, an investigations officer with the OPG, and this is a summary of what he said:
The Public Guardian has no medical evidence that H does not have capacity to manage P’s property and financial affairs. However, he has concerns that the decisions made by H on her behalf are unwise and not in her best interests.
On 17 March 2014 H made a power of attorney in Spain, in which he appointed his son and daughter from his first marriage and MQ to be his attorneys. It is unclear whether, by default, the Spanish power of attorney enables MQ to make decisions regarding P’s property and financial affairs.
H seems unclear as to what he intends to do with the sale proceeds from the planned sale of two of the Spanish properties and it is unclear whether P will receive the value of her beneficial interest in those properties.
H has not managed the rental income of the properties effectively and in the best interests of P and they have not yielded any income for her.
H has also made undocumented loans to himself from P’s funds with no indication of there being any financial advantage to P or any terms of repayment.
On 15 December 2014 I made an order requiring:
the OPG to serve the papers on H by 24 December 2014;
H to respond to the application by 23 January 2015; and
the matter to be referred back to me on or after 26 January 2015.
Responses to the application
On 23 December 2014 P’s sister, S, completed an acknowledgment of service in which she consented to the Public Guardian’s application, but said that, rather than appoint a panel deputy, she would like to be considered for appointment as P’s deputy jointly and severally with her niece, D.
On 28 December 2014, D completed an acknowledgment of service, in which she, too, consented to the application and said that she wished to be appointed as P’s deputy together with her aunt, S.
On 31 January 2015 H filed an acknowledgment of service in which he opposed the application. He also filed a detailed witness statement, which he ended as follows:
“In conclusion, I wonder why this fighting and maliciousness should be taking place at all. We are all on the same side. I have been open and honest in all my dealings with everyone concerned. I wish to continue to do this but also wish to continue to be involved in my wife’s affairs. I have devoted nearly 35 years of my life to her and for her relations to gang up against me like this is shocking and outrageous. For her family to seek to exclude me is upsetting. I therefore ask the Court of Protection to prevent this from taking place and instead to propose a situation where we share responsibility, for instance her sister taking responsibility for her accounts in England. I am happy to discuss any decisions that need to be made for my wife fully with her daughter and sisters to ensure all of their wishes are taken into account.”
On 13 February 2015 I made an order setting out a timetable for filing any further evidence and submissions and listed the matter for hearing on 6 May 2015.
The Public Guardian’s response
On 16 March 2015 Andrew Tovey of the OPG filed a further witness statement, in which he said as follows:
…..
In his response dated 31 January 2015, H detailed extensive costs to the three Spanish properties which he has paid for from his own money. This included repair costs in the region of €30,000 and monthly bills for each property. While there is no evidence for the repair costs, it is clear that P’s finances have not been used to pay towards these properties. H explained the difficulties he has had with both selling the properties and renting them out. H has also confirmed that the proceeds from the sale of all the properties will be split 50/50 between him and P. He will look to invest this with St James’s Place Wealth Management.
In his response H explained how MQ had stolen £12,000 from him and left his accounts severely overdrawn. H stated that his loaning of £7,000 from his wife would not inconvenience her in any way and that, if she had mental capacity, she would have agreed to the loan. The Public Guardian believes it is highly unlikely that P would have agreed to such a loan, given that it was to repay money stolen by MQ, and this loan contravenes the attorney’s authority under the Mental Capacity Act 2005. Furthermore, H only agreed to pay back the loan to his wife after I suggested this to him.
In his response, H explained how his relationship with MQ has developed. He stated that “I admit I lost my head at the beginning … since then there has been a theft of money and broken promises.” This suggests that H will not let anything like this happen again. However, contradictorily, it is clear that H is still in a relationship with MQ and he has purchased for her a property worth €100,000 from his own money.
In his response, H stated that, following advice from D, he has revoked the appointment of MQ as an attorney under his Spanish power of attorney. The Public Guardian is still concerned that MQ may not deal with the three properties in Spain in the best interests of P. This revocation prevents her from legally having authority over these properties.
H’s response confirms that he has contravened his duties as attorney for P by using her money to pay off his own debts. These debts were caused by his relationship with MQ, who still plays a big role in H’s life. The Public Guardian is still concerned about the influence MQ holds over H and the knock-on effect this has on P’s finances. There are still large decisions to make in the future, particularly regarding the sale of the Spanish properties. Although H has removed MQ as his Spanish attorney, he is still in a relationship with her and the Public Guardian is concerned that she may influence his decision regarding what to do with the proceeds of the property sales.
The Public Guardian still asks the court to consider the immediate revocation and cancellation of the registration of the EPA made by P and registered on 12 March 2013.
If the court decides that H is to be removed as attorney for P, the Public Guardian supports the application made by S and D to become her jointly and severally appointed deputies. As one is based in Spain and one in England, this will ensure that P’s assets are managed in her best interests.
The hearing
The hearing took place on Wednesday 6 May 2015 and was attended by:
Nadia Dhillon of the OPG;
H, who was unrepresented but was accompanied by his son and daughter; and
P’s daughter, son-in-law, son, and sister.
The law relating to the revocation of an EPA
The Public Guardian’s application was for an order under paragraphs 16(4)(g) and 16(5) of Schedule 4 to the Mental Capacity Act 2005. Paragraph 16(4) states that:
“The court must direct the Public Guardian to cancel the registration of an instrument registered under paragraph 13 in any of the following circumstances -
(g) on being satisfied that, having regard to all the circumstances and in particular the attorney’s relationship to or connection with the donor, the attorney is unsuitable to be the donor’s attorney.”
Paragraph 16(5) provides that:
“If the court directs the Public Guardian to cancel the registration of an instrument on being satisfied of the matters specified in sub-paragraph (4)(f) or (g) it must by order revoke the power created by the instrument.”
There was a spate of reported decisions on the ‘unsuitability’ of attorneys a few years ago, all of which involved inter-sibling hostility:
Re W (Enduring Power of Attorney) [2000] 3 WLR 45, where the decision at first instance was upheld by the Court of Appeal inRe W (Enduring Power of Attorney) [2001] 2 WLR 957;
Re E (Enduring Powers of Attorney) [2000] 3 WLR 1974; and
Re F [2004] 3 All ER 277.
This line of authorities terminated with the following statement of Mr Justice Patten (as he then was) in Re F, [2004] 3 All ER 277, at page 284f:
“It seems to me that to remove a chosen attorney because of hostility from a sibling or other relative, in the absence of any effective challenge to his competence or integrity, should require clear evidence either that the continuing hostility will impede the proper administration of the estate or will cause significant distress to the donor which would be avoided by the appointment of a [deputy].”
The criteria whereby the court may revoke an EPA are different from those for revoking a Lasting Power of Attorney (LPA).
Rather than applying a general or abstract criterion of ‘unsuitability’, and instead of requiring the court to have regard to ‘all the circumstances’, section 22 of the Mental Capacity Act 2005 is narrower and more focused. It provides that the court may revoke an LPA only if:
the donor lacks the capacity to revoke it, and
the attorney has behaved, or is behaving, or proposes to behave in a way that contravenes his authority or is not in the donor’s best interests.
One further difference between EPAs and LPAs is that attorneys acting under an EPA must comply with the fiduciary duties described in paragraphs 7.58 to 7.68 of the Mental Capacity Act 2005 Code of Practice (Code, paragraph 7.79), whereas an attorney acting under an LPA must not only comply with these fiduciary duties, but also must:
act in accordance with the provisions of the Mental Capacity Act and in particular sections 1 (the principles) and 4 (best interests) (MCA 2005, section 9(4)(a)); and
have regard to the Mental Capacity Act Code of Practice in a wider sense (MCA 2005, section 42(4)(a)).
Notwithstanding the absence of an express requirement in either the Mental Capacity Act or the Code of Practice for an attorney acting under an EPA to act in the donor’s best interests, in my judgment, any attorney acting under an EPA who has contravened his authority or has behaved, or is proposing to behave, in a way that is not in the donor’s best interests is potentially ‘unsuitable’, although the court needs to have regard to all the circumstances, and to consider ‘the bigger picture’, before it can finally determine whether the attorney is unsuitable to be the donor’s attorney.
Decision
Hostility does not really feature in this case and essentially the issue is whether:
there has been an effective challenge to H’s competence or integrity; or
he has behaved in a way that contravenes his authority or is not in P’s best interests.
There is no need for me to make a formal finding that H is either incompetent or that he lacks integrity because, by his own admission, he has breached his fiduciary duty and taken advantage of his position as attorney by using his wife’s money to pay off his debts and to replenish his account. This alone should be sufficient to qualify him as unsuitable to be P’s attorney, though, as I have said, the court needs to look at the bigger picture before it can be entirely satisfied on this point.
We learnt at the hearing that H now finds it a considerable strain travelling to England from Spain and back again, and that it takes him about a fortnight to recover from each journey. He is also at his wits’ end with regard to the Spanish properties, and in many ways it would be an act of kindness to relieve him of the additional responsibility of having to manage his wife’s property and financial affairs.
The proposed appointment of S and D as joint and several deputies has much to commend it. S visits P two or three times a week, and could have access to her funds in England to provide for her day-to-day requirements. D, who lives in Spain, would be readily available to assist H with either disposing of the properties or ensuring that they are let to reliable tenants on satisfactory terms.
H was concerned that P’s family would exclude him from having any involvement in her affairs. I would be surprised if this was their intention. In fact, I was impressed by the family’s conduct at the hearing. Although occasionally they needed to say a few harsh words, everyone showed exemplary respect and affection for each other.
In any event, before making any decisions, the deputies have a duty to consult H and take into account his views as to what would be in P’s best interests: MCA 2005, section 4(4)(7). To some extent this is the “situation where we share responsibility” that H envisaged in his response to the application.
However, by appointing deputies to act in H’s place there is an obvious shift in the balance of power, which is necessary for two reasons:
to ensure that P’s affairs are managed in her best interests; and
to ensure that any decisions regarding P’s affairs are free from the influence that MQ exerts over H.
I also consider that the revocation of the EPA in order to facilitate the appointment of the two deputies is a necessary and proportionate response for the protection of P’s right to have her financial affairs managed properly and for the possible prevention of crime.
Therefore, having regard to all the circumstances, I am satisfied that H is unsuitable to be P’s attorney and I shall by order revoke the EPA. I shall also make a separate order appointing S and D jointly and severally to be P’s deputies for property and affairs.