Miles & Anor v The Public Guardian

I have before me two appeals from decisions of Senior Judge Lush sitting in the Court of Protection, one in a case called Re Miles and one in a case called Re Beattie in both of which he was concerned with lasting powers of attorney either for property and financial affairs or for health and welfare matters. In each case the former power of attorney had been drafted by the same solicitor and contained provisions which the Judge was asked to rule on, as to whether they were effective.

He gave a judgment in relation to the Miles case which is dated 4th November 2014 in which he held that certain provisions in the power of attorney were ineffective and, by his order of the same date he, having determined that those words were ineffective, severed the words and set out in the schedule the wording, striking out those which he had severed. In relation to the Beattie case there was no separate judgment because the wording was identical, but he made an order two days later, on 6th November, to a similar effect. He refused permission to appeal but permission to appeal was granted by Rose J on 22nd April 2015 and she directed that the two appeals should be listed to be heard together.

Before coming to the particular wording of the particular powers of attorney in this case I should set out the statutory framework which is as follows. Lasting powers of attorney were introduced by the Mental Capacity Act 2005 replacing the previous provisions for enduring powers of attorney, both lasting powers of attorney and enduring powers of attorney being intended to address the problem that at common law a power of attorney was revoked by the donor’s incapacity. Both were designed to enable a form of power to be entered into by a donor with capacity which would continue to have effect after the donor lost capacity.

The Mental Capacity Act 2005 in section 9 provides that:

“(1)

A lasting power of attorney is a power of attorney under which the donor (‘P’) confers on the donee (or donees) authority to make decisions about all or any of the following –

(a)

P's personal welfare or specified matters concerning P's personal welfare, and

(b)

P's property and affairs or specified matters concerning P's property and affairs,

and which includes authority to make such decisions in circumstances where P no longer has capacity.

(2)

A lasting power of attorney is not created unless –

(a)

section 10 is complied with

…

Section10 headed “Appointment of donees” provides as follows: “(1) A donee of a lasting power of attorney must be –

Section13 headed “Revocation of lasting powers of attorney etc.” states: “(1) This section applies if –

The court has certain powers. Section 22 provides:

“(1)

This section and section 23 apply if –

(a)

a person (‘P’) has executed or purported to execute an instrument with a view to creating a lasting power of attorney, or

(b)

an instrument has been registered as a lasting power of attorney conferred by P.”

Under section 23(1):

“The court may determine any question as to the meaning or effect of a lasting power of attorney or an instrument purporting to create one.”

That is supplemented by Schedule 1 paragraph 19 which reads:

“Subparagraph (2) applies if the court determines under section 23(1) that a lasting power of attorney contains a provision which –

(a)

is ineffective as part of a lasting power of attorney

…

(2)

The court must –

(a)

notify the Public Guardian that it has severed the provision

…”

It was under those provisions, section 23(1) and paragraph 19(2) that the Senior Judge made the order that he did.

The practical effect of section 13(5) and 13(7) when read with the requirement in section 10 that donees, if there is more than one, must be appointed to act jointly or jointly and severally or jointly in respect of some matters and jointly and severally in respect of others (what Ms. Hearnden, who appeared for the Public Guardian, helpfully called “a hybrid appointment”) is, as counsel were agreed, as follows. In the event that only one donee is named in the power of attorney, say, “A”, and no replacement is named, then under section 13(5) when one of the events mentioned in section 13(6) (disclaimer, bankruptcy, dissolution of marriage and lack of capacity) takes place, the power is revoked under section 13(5)(b) and there being no replacement, that is the end of the power.

I will, for the ease of exposition, refer to the case of A’s death as encompassing all the other circumstances in which A ceases to be able or willing to act. If, of course, the donor has named a replacement attorney to take effect on A’s death, say “C”, then on A’s death C takes over as donee and that is the effect of section 13(7)(a) “the donee is replaced under the terms of the instrument”.

In the case where A and B are initially appointed as donees and are appointed jointly in respect of all matters, it is agreed by counsel – and does seem to me to be right as a matter of the statutory provisions – that in the event of either A or B dying or otherwise ceasing to be able or willing to act, the appointment comes to an end. If no replacement is named the power is revoked. That is clear from the limitation in section 13(7)(b) to the powers not being revoked only where either the donee is replaced or “he is one of two or more persons appointed to act as donees jointly and severally in respect of any matter and, after the event, there is at least one remaining donee”. If A and B are initially appointed jointly and there is no replacement then, on A’s death B ceases to be able to act. As it was put by Ms. Hearnden, A and B are a unit and on that unit ceasing to be able to act because of A’s death, B has no power to continue to act where they have originally been appointed jointly. If, of course, C has been appointed as a replacement, then on A’s death C takes over to the exclusion of B.

By contrast, if A and B were originally appointed jointly and severally in respect of all matters and A dies, then the effect of section 13(7)(b) is that B is, as the remaining donee, able to continue to act. If there is a replacement C appointed then it seems to me – and I do not understand counsel to have dissented from this – that in circumstances where C’s replacement appointment takes effect on A’s death, B and C become the two attorneys who are able to act jointly and severally in respect of all matters, but it is possible for the donor to specify that C should only be appointed on the death or other inability or unwillingness to act of both A and B, so that in the event of A’s death, B becomes able to act and only on B’s subsequent death does C replace B.

So far so good. The difficulty arises in relation to hybrid appointments, that is, jointly in respect of some matters and jointly and severally in respect of others. If A and B are appointed jointly in respect of some matters and jointly and severally in respect of others and A then dies, it seems to me – and again, counsel did not dissent from this – that in the absence of any other provision in the power of appointment, the practical effect is that if no replacement is appointed then B can only continue to act in relation to those matters for which he was originally appointed jointly and severally and nobody is able to act in relation to the matters for which A and B were appointed jointly.

In the cases before me – and, as I imagine, is normally the case – the hybrid appointment provides that certain more significant decisions are to be made jointly whereas less significant decisions can be made jointly and severally. In the property and financial affairs power of attorney Mrs. Miles provided that her two attorneys could act jointly and severally save with regard to sale of her property and transactions in excess of £10,000. That, as I say, is likely to be a fairly typical case. The practical effect is that if no replacement attorney is appointed, on A’s death nobody has power to sell the house or enter into transactions of more than £10,000 whereas the surviving donee is able to enter into transactions of less than £10,000.

If a replacement attorney is appointed, C, then it is possible that on A’s death C can be appointed to take over from A. But that would lead to what has been submitted to me – and there has really been no dissent from this – is a position which might not be what the donor intended, in circumstances where the donor has selected A and B as the two people whom she trusts most to deal with her affairs and has entrusted the sale of the house to A and B jointly. In circumstances where A is no longer able or willing to act, it is not obvious that the donor would in those circumstances always prefer her third choice of attorney, C, to have the power to sell the house rather than entrust it to the surviving of her two original attorneys, B.

It is to meet that situation that the draftsman of Mrs. Miles’ power of attorney attempted to address it by engineering a position in which, so long as A and B were still able and willing to act, they should act jointly in relation to the sale of the house or transactions in excess of £10,000, but that where one of them was unable or unwilling to act, the surviving donee or remaining donee should do so themselves rather than that decision going over to the third donee, the replacement attorney.

It has, in the course of argument, become clear that it is common ground between the parties, that is between Mr. Boyle, who appears for the appellants, and Ms. Hearnden, that there is nothing in the Act which precludes that situation from being brought about provided that the wording is sufficiently clear and transparent that everybody – both the donor and the donees and the OPG itself – can see precisely how it is intended to operate. Since neither party has suggested to me that that is not possible, it is sufficient for me to say any more than that I agree. If that is the case, it does seem to me that it is right that the Act should be construed in a way which gives as much flexibility to donors to set out how they wish their affairs to be dealt with as possible, the Act being intended to give autonomy to those who are in a position where they can foresee that they may in the future lack capacity to specify who it is that they wish to act for their affairs. It would be unduly restrictive to require the Act to be interpreted in such a way in the circumstances which I have outlined, that is where a donor selects two people, A and B, to make a joint decision in relation to important decisions, that the donor should not be able in those circumstances to say that if one of them was unable to act she wished the remaining of the two original attorneys to make the decision alone.

Mr. Boyle suggested that that could be achieved by under the provisions of section 10(8)(b) which says:

“An instrument used to create a lasting power of attorney

…

(b)

my itself appoint a person to replace the donee (or, if more than one, any of them) on the occurrence of an event mentioned in section 13(6)(a) to (d) which has the effect of terminating the donee's appointment.”

And as he put it, there was no objection, in a case where A and B had originally been appointed jointly for any matter, on that appointment failing because A dies or disclaims or the like, for there to be a re-appointment under section 10(8)(b) replacing the original joint appointment of A and B with B alone.

Ms. Hearnden has not argued to the contrary and I agree that a purposive and beneficial interpretation of the Act ought to be capable of encompassing that situation and although it is necessary, pursuant to some regulations which are called the Lasting Powers of Attorney, Enduring Powers of Attorney and Public Guardian Regulations SI 2007 No. 1253 as amended, for the power of attorney to comply with the prescribed form of instruments which are set out in detail in schedules to the Regulations, it does not seem to me that there is anything in the form which precludes that from being done if necessary either in the space on page 5 of the form or in a continuation sheet A2 which enables the donor to provide further additional information about

“How you want your attorneys to act including which decisions your attorneys should make jointly and which decisions they should make jointly and severally”.

In the course of discussion with Ms. Hearnden she accepted that it would be possible for a donor to appoint two attorneys initially ticking the box that they should have power to make decisions jointly for some decisions and jointly and severally for other decisions, i.e. a hybrid appointment, and then specify with clarity the circumstances in which they were to act jointly and then the circumstances in which that joint appointment was to be replaced with, effectively, a sole appointment.

What would meet the desired aim would be to specify,

“I wish my attorneys A and B to act as follows:

(1)

So long as both attorneys are able and willing to act, I wish them to make the following decisions jointly: sale of the house; transactions over £10,000 [or the like] but all other decisions to be made jointly and severally;

(2)

In the event that one of my original attorneys A and B is unable or unwilling to act, I then appoint the remaining of my original attorneys A or B, as the case may be, as replacement attorney to act solely;

(3)

In the event of both my original attorneys being unable or unwilling to act, I appoint C as a replacement attorney to act solely [with whatever variations the case requires].”

She accepted that provided that that was clear, there was no prohibition in the Act on providing an appointment in that form.

I agree with that analysis and I see no reason why that should not be done.

In those circumstances the only remaining question is whether the form that was in fact adopted here is sufficient to satisfy those requirements. In the course of argument Mr. Boyle accepted that there were some aspects of the form which were potentially confusing. I agree. But, in essence, it seems to me that the form of words drafted for Mrs. Miles, with the excision of the words which are confusing, does achieve what I have said Ms. Hearnden accepted as being possible to achieve.

I should now refer to the words which are found. I will start with Mrs. Miles’ LPA for property and financial affairs. Having ticked the box that the attorneys should act jointly for some decisions and jointly and severally for other decisions, she provided as follows:

“My attorneys may act jointly and severally save with regard to:

1.

any sale of my property at [and it set out her address] (or any property which may subsequently replace it); and

2.

any transaction in excess of £10,000

when all surviving attorneys who are capable of acting (whether originally appointed or who have been appointed by and are acting in substitution) shall act jointly in so far as there may be more than one of them able to do so but in the event that there is only one of them capable of acting I expressly re- appoint that attorney to act alone.”

Mr. Boyle accepted that the words in brackets added nothing to what he was hoping to achieve and were confusing. I must confess that when I read them I did not understand what they were seeking to do. I think they are undoubtedly unhelpful. But if one excises the words in brackets I think it can be seen that this form of words does achieve what Ms. Hearnden accepted could be achieved in the form which I went through earlier at paragraphs 1 and 2 of that form. It sets out that:

“When all surviving attorneys are capable of acting they should act jointly for sale of the property and transactions in excess of £10,000, that otherwise the attorneys should act jointly and severally and that in the event that there is only one of the original attorneys capable of acting, I expressly reappoint that attorney to act alone.”

That does seem to me, although not quite as clear as the form which Ms. Hearnden endorsed, to achieve in practical terms the same results, namely, that there is an initial appointment of the two attorneys A and B to act jointly in respect of some matters and severally in respect of other matters, but that when there is only one of them capable of acting there is then a re-appointment of the surviving original attorney to act alone.

The next paragraph reads as follows:

“My replacement attorney shall only act in the event that both of my originally nominated attorneys shall have died before me or are otherwise unable or unwilling to act or the appointment the fails for any other reason.”

Ms. Hearnden accepted that there was no reason why a donor should not specify that the replacement attorney should only take office in the event that the original two attorneys had ceased to be able or willing to act.

The third paragraph was:

“In the event of any difficulty arising with the operation of the provisions above then my attorneys should act jointly and severally and in the event of any replacement attorney acting because of failure of the above provisions my originally nominated attorneys who are still capable of acting shall be reappointed to act with them insofar as it shall be possible to do so and on a joint and several basis.”

Given that I have expressed a view that, with the excision of the words in brackets, the first two paragraphs are valid and effective, there is no need for the third paragraph and it has no operation. Mr. Boyle said that there was no good reason for the Senior Judge not to apply it. I should have said that he struck out all the words in paragarph 1 after the word “£10,000”, so striking out the lines which read:

“when all surviving attorneys who are capable of acting (whether originally appointed or who have been appointed by and are acting in substitution) shall act jointly insofar as there may be more than one of them able to do so but in the event that there is only one of them capable of acting I expressly re- appoint that attorney to act alone.”

He left in the second paragraph and he struck out the third paragraph.

Mr. Boyle says that he should not in any event have struck out the third paragraph because on the basis of his decision that the first paragraph did not operate as intended, the third paragraph should have taken effect. I understand all that but in the event that I have found that the first two paragraphs do operate, with the excision of the words in brackets, perfectly sensibly, it does seem to me that the third paragraph is unnecessary and, being unnecessary, it has no effect. It is therefore technically ineffective and I think that it would be no bad thing for it to remain struck out as Ms. Hearnden suggested, to avoid any possibility of confusion.

That is the view that I have come to. That is not the same view that the Senior Judge came to. I should briefly deal with the reasons why he took the view that he did. I apprehend that the argument before him was slightly different from the argument before me, but the effective decision of his started from the position that previously the Court of Protection could appoint the precursors of deputies who were known first as “committees” and later “receivers” to act jointly with survivorship. Indeed in the Court of Protection Rules 2001 Rule 44 expressly provided that the court may, when appointing two or more receivers direct that “the receivership shall continue in favour of the surviving or continuing receiver or receivers”.

He then proceeded to explain that the Court of Protection could no longer appoint Deputies to act jointly with survivorship, setting out the options in section 19(4) of the Mental Capacity Act which were to appoint two or more deputies to act jointly, jointly and severally or jointly in respect of some matters and jointly and severally in respect of others and pointed out that that was exactly the same choice given to donors of LPAs. He then explained what the terms “jointly” and “jointly and severally” meant. The upshot was that there was no express provision enabling attorneys to be appointed jointly with survivorship.

He then set out two possible ways in which that could be done. One was by appointing A, B and C jointly to be attorneys and then subsequently to act jointly and severally. He took the view in paragraph 28 of his judgment that it would not be possible to achieve this because of the design of section 4 of the prescribed form.

“Having already ticked the box” – he said – “to appoint the original attorneys to act jointly, there is no facility for the donor to state that the replacement attorneys shall act jointly and severally.”

I have already said that I do not agree and I see no reason why, leaving aside the facts of this case, a donor should not appoint A and B to act jointly, if desired in respect of all matters, but in the event of that appointment failing (because of the death or disclaimer of either of the original donors) for C and D to be appointed as replacement attorneys but to have power to act jointly and severally. The correct place for putting that in the form, I think, would be on continuation sheet A2 (as I referred to earlier) which enables the donor to provide further additional information about how they want their attorneys to act.

So I do not find the reason for the Senior Judge’s decision in paragraph 28 an entirely convincing one. He then went on in paragraph 29 to set out an alternative method by which the practical effect of a joint attorneyship with survivorship could be achieved, which would be to execute two LPAs. That, I agree, would be possible to do, the second LPA being contingent on the first one failing. But not only would it necessarily involve more expense, it seems to me to be prima facie unsatisfactory that a donor who wished to achieve what I regard as a perfectly sensible result, that in the event of both the original attorneys being unable to act, the surviving attorney should be able to make all decisions, should have to adopt what would be a cumbersome and potentially confusing method in order to achieve that result.

Then there is one other point that the Senior Judge made in paragraphs 33 and 34 which is:

“… that the re-appointment of a surviving attorney is contingent and unpredictable and fails explicitly to name either an individual or a trust corporation, as is required by section 10(1) of the Act.”

He went on to say that:

“34.

Page 13 of the guidance booklets – LPA111 and LPA112”

– which were issued by the OPG – “states ‘To avoid rejection of your LPA when applying to register … Make sure that you provide details of named individuals (i.e. not a title like ‘Director of Social Services’ or the name of a firm of solicitors).’” The Judge continues: “The same would apply to the appointment of ‘all the surviving attorneys who are capable of acting.’”

Then at paragraph 35 he said:

“There are also problems relating to the surviving attorney’s acceptance of the appointment, which is normally effected by signing Part C of the prescribed form, headed ‘Declaration by each attorney or replacement attorney’.”

I agree that there is a potential difficulty in not naming an individual in a power of attorney but naming a title such as “the Director of Social Services”, or the name of a firm of solicitors, or even “the senior partner” of a firm of solicitors when the appointment is to take effect at some future uncertain date. The problem is that that individual, although identifiable when the appointment comes to take effect, will not have been named as an attorney or a replacement attorney in the form and will not have signed the form, and the form is drafted on the basis that each of the attorneys and replacement attorneys are to make declarations in Part C of the form. Those are obviously important declarations because they confirm the attorney or replacement attorney’s understanding of the role and responsibilities and they have to be witnessed. If, for example, a power of attorney said, “I appoint A and B as my original attorneys. In the event that they are unable to act I appoint the senior partner for the time being of Firm X as my replacement attorney”; it would not be possible to identify at the date that the power of attorney was executed, who that person would be and therefore there would be no declaration by them.

So I can see precisely why the guidance suggested that named individuals should be appointed. Nevertheless, I do not see that that consideration prevents an appointment in the form that I earlier referred to, namely, “I appoint the named individuals A and B to act jointly and in the event of one of them ceasing to be capable or willing to act, I appoint the surviving one, A or B as the case may be, to act alone”. Those individuals are named at the time of execution of the power of appointment and will have necessarily signed the declarations in Part C of the form so that the considerations which make it unsatisfactory to appoint people who are not named do not, it seems to me, apply.

Having considered the various reasons put forward by the Senior Judge in his conclusion, I am of the view that this appeal should be allowed and that the correct disposal in relation to Mrs. Miles’ property and financial affairs LPA is that paragraph 1 of the form should be allowed to stand with the excision of the words in brackets; paragraph 2 of the form should be allowed to stand; but paragraph 3 should be severed on the basis that it is, in the circumstances, both confusing and of no effect.

In relation to the LPA for health and welfare, similar considerations apply. The original text was as follows, and I will indicate which words were severed by the Senior Judge:

“My attorneys may act jointly and severally save with regard to any decision as to the withdrawal of life sustaining treatment” – and then all the remaining sentence is struck out. – “when all surviving attorneys who are capable of acting (whether originally appointed or who have been appointed by and are acting in substitution) shall act jointly insofar as there may be more than one of them able to do so but in the event that there is only one of them capable of acting I expressly re-appoint that attorney to act alone.”

The second paragraph, which was allowed to stand save for the words at the end, is as follows:

“My replacement attorney shall only act in the event that both of my originally nominated attorneys shall have died before me or are otherwise unable or unwilling to act or the appointment of them fails for any other reason” – and the following words were struck out – “and I also expressly re-appoint any originally nominated attorneys who are still capable of acting and wish to do.”

Then the third paragraph which was all struck out:

“In the event of any difficulty arising with the operation of the provisions above then my attorneys should act jointly and severally and in the event of any replacement attorney acting because of failure of the above provisions my originally nominated attorneys who are still capable of acting shall be re- appointed to act with them insofar as it shall be possible to do so and on a joint and several basis.”

For similar reasons as with the property and financial affairs LPA, I will allow paragraph 1 to stand with the exception of the words in brackets “(whether originally appointed or who have been appointed by and are acting in substitution)”.

As to paragraph 2, Mr. Boyle accepted that the words which the Senior Judge had struck out at the end should remain struck out because they have no effect and they are potentially confusing; the point being that since paragraph 2 provides that,

“My replacement attorney shall only act in the event that both of my originally nominated attorneys shall have died before me or are otherwise unable or unwilling to act”

it makes no sense to re-appoint any originally nominated attorneys who are still capable of acting and wish to do so because ex hypothesi neither of the originally nominated attorneys will be in that position.

As to paragraph 3, for similar reasons as with the property and financial affairs LPA, I take the view that it should remain struck out.

That deals with Mrs. Miles’ appeal.

In Mrs. Beattie’s case, as I say, there is no separate judgment and all I have is the order. The order only deals with one LPA which was for health and welfare. Section 4 of the LPA for health and welfare was originally in this form,

“My attorneys may act jointly and severally save with regard to any decision as to withdrawal of life sustaining treatment when all surviving attorneys who are capable of acting shall act jointly in so far as there may be more than one of them able to do so but in the event that there is only one of them capable of acting I expressly re-appoint that attorney to act alone.

In the event of any difficulty arising with the operation of the provisions above or them being rejected by the Office of the Public Guardian or the Court of Protection then my attorneys should act jointly and severally.”

In this case Mrs. Beattie appointed two attorneys in the first instance and no replacement attorneys. Although the order is headed, “Order severing words in two lasting powers of attorney”, it does not appear that there was any more than the one power of attorney for health and welfare. The words which the Senior Judge struck out on the grounds that they were ineffective for the reasons stated in his judgment in the case of Re Miles were as follows. First, the word “surviving” in paragarph 1 and then the words “who are capable of acting” and then the words “in so far as there may be more than one of them able to do so, in the event but there is only one of them capable of acting, I expressly re-appoint that attorney to act alone” as well as the second paragarph providing that “in the event of any difficulty then the attorneys should act jointly and severally”.

For the reasons that I have already expressed, paragraph 1 should be reinstated although it seems to me that the word “surviving” adds nothing and is potentially confusing so that it should read as follows:

“My attorneys may act jointly and severally save with regard to any decision as to withdrawal of life sustaining treatment when all attorneys” – and I will take out the words “who are capable of acting” – “shall act jointly in so far as there may be more than one of them able to do so but in the event that there is only one of them capable of acting, I expressly re-appoint that attorney to act alone.”

I will leave the second paragraph struck out.

That, I think deals with both cases and unless there is anything else, I would allow the appeal in those terms.

I am going to make no order as to costs. You have achieved what you wanted. As I say, it was not opposed in principle and it has been very helpful to have the representation of the OPG here.