BAILII is celebrating 24 years of free online access to the law! Would you consider making a contribution?
No donation is too small. If every visitor before 31 December gives just £5, it will have a significant impact on BAILII's ability to continue providing free access to the law.
Thank you very much for your support!
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] | ||
England and Wales High Court (Chancery Division) Decisions |
||
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> J, Re (Enduring Power of Attorney) [2009] EWHC 436 (Ch) (12 March 2009) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2009/436.html Cite as: [2009] EWHC 436 (Ch), [2010] WLR 210, [2010] 1 WLR 210, [2009] 2 All ER 1051, [2009] WTLR 435 |
[New search] [Printable RTF version] [Buy ICLR report: [2010] 1 WLR 210] [Help]
Strand, London, WC2A 2LL |
||
B e f o r e :
____________________
IN THE MATTER OF J (ENDURING POWER OF ATTORNEY) |
____________________
Mr David Rees (instructed by The Public Guardian) for the Respondent
Hearing date: 5th March 2009
____________________
Crown Copyright ©
Mr Justice Lewison:
"I … appoint my wife [W] to be my Attorney for the purposes [of the] Enduring Powers of Attorney Act 1985 but if she shall have predeceased me or shall be unable to act or to continue to act as my Attorney whether registered or unregistered then in the alternative I appoint my son [A] and my son [B] and my son [C] jointly and severally to be my attorney(s) for the purpose of the Enduring Powers of Attorney Act 1985 with general authority to act on my behalf in relation to all my property and affairs."
i) An enduring power of attorney is a sub-species of powers of attorney generally (Schedule 4 para. 1). Thus it must comply with the formalities necessary to create a power of attorney. It follows from this that, unless qualified by a restriction in the instrument itself, an enduring power of attorney will take effect immediately.
ii) An enduring power of attorney must comply with additional formalities. These include a requirement that the instrument must be in a prescribed form; and that it must be executed not only by the donor of the power but also by the attorney (Schedule 4 para. 2).
iii) If an instrument appoints more than one person to be an attorney it must state whether they are appointed to act jointly, or jointly and severally (Schedule 4 para. 20).
iv) An enduring power of attorney may contain conditions or restrictions which limit the authority conferred on the attorney by the power (Schedule 4 para. 3).
v) There is no limit to the number of enduring powers that a donor can create; and they may exist concurrently or successively: Re E (Enduring Powers of Attorney) [2001] Ch 364, 373E.
vi) If the formalities are complied with, an enduring power of attorney will not be revoked by any subsequent mental incapacity of the donor (Schedule 4 para.1).
vii) As soon as an attorney under an enduring power of attorney has reason to believe that the donor is or is becoming mentally incapable, he must apply to the Public Guardian to register the power (Schedule 4 para. 4)
viii) Registration is not discretionary. The Public Guardian must register the power unless one or more of five specified grounds of objection are made out. If any of the specified grounds are made out, then he must not register the power (Schedule 4 para.13). The five specified grounds are contained in Schedule 4 paragraph 13 (9).
ix) Once the power has been registered it cannot be revoked without an order of the court; and the donor cannot extend or restrict the scope of the power or give instructions to the attorney (Schedule 4 para.15).
"Subject to paragraphs (2) and (3) of this regulation and to regulation 4, an enduring power of attorney must be in the form set out in the Schedule to these Regulations and must include all the explanatory information headed "About using this form" in Part A of the Schedule and all the relevant marginal notes to Parts B and C. It may also include such additions (including paragraph numbers) or restrictions as the donor may decide."
"Where more than one attorney is appointed and they are to act jointly and severally, then at least one of the attorneys so appointed must execute the instrument for it to take effect as an enduring power of attorney, and only those attorneys who have executed the instrument shall have the functions of an attorney under an enduring power of attorney in the event of the donor's mental incapacity or of the registration of the power, whichever first occurs."
"The registration of this enduring power of attorney is qualified and extends to [name of attorney(s) not affected by the objection] only as the attorney(s) of [name of donor]"
"(1) An instrument which appoints more than one person to be an attorney cannot create an enduring power unless the attorneys are appointed to act—
(a) jointly, or
(b) jointly and severally."
"Thus the EPA donor might prefer to appoint not just, say, his spouse as attorney but his children as well. He might create a joint power so that all the attorneys would have to act together or a joint and several power which would be operated by all or any of them."
"We do not recommend that an instrument should be able to provide for successive EPAs; that is, one or more attorneys who would replace the original attorney or attorneys should he or they cease to act. Our main reason for this is that the benefit to be gained by including successive EPAs in our proposals would be out of all proportion to the complexity that such powers would create in relation to some of the more detailed areas of our scheme. In any event, successive EPAs are rendered largely unnecessary because a joint and several EPA would permit the continuation of the EPA in the event of one of the attorneys ceasing to act. It would, however, be possible to create the effect of successiveness by a donor granting EPAs in separate instruments so that the authority of an attorney under one power could commence only upon the termination of the authority of an attorney under another power."
i) The prescribed forms would have needed to be differently worded. This is, in essence, the point that the donor must choose between the two alternatives of "joint" on the one hand or "joint and several" on the other. There are, I think, at least two answers to this. First, although regulations made under and contemporaneously with an Act of Parliament are part of the context, they cannot add to or detract from the proper interpretation of the Act. A recent example of a case in which the draftsman of a prescribed form misunderstood the Act under which the form was prescribed is Scottish & Newcastle plc v Raguz [2008] 1 WLR 2494 Second, regulation 2 (1) expressly permits additions to the prescribed form. I cannot see why that would prevent a donor of an enduring power of attorney from specifying two sets of attorneys, provided that it is made clear in relation to each set whether they are to act jointly on the one hand or jointly and severally on the other.
ii) There would be additional complexity in the registration process. Mr Rees put it thus.
"The legislation and rules would need to address the question of how such a power should be registered. If an instrument appoints A to act alone and then B and C to act jointly and severally, how is registration to be effected? Does the court simply register the instrument without qualification? If so, if an objector wishes to object to the registration of B as being unsuitable, does he need to object at this stage even though B cannot act whilst A is acting? If the registration is unqualified, how is a person dealing with B or C to know whether A's powers have come to an end?"
The answer to the first question is that since a qualified registration may only be made in very limited circumstances (of which this is not one) the registration must be unqualified. To that extent I can see no warrant for the practice developed by the Court of Protection of registering such powers as enduring powers of attorney but with qualifications. But the consequential problem that Mr Rees identifies is equally present if (as the Law Commission expressly contemplated) the donor executes two enduring powers of attorney, one in favour of A and the other a contingent power in favour of B and C. Both must be registered as soon as the donor loses mental capacity. An objector would have to object to the registration of the power in favour of B and C, even though B and C cannot act while A is acting. If the objection fails, then both enduring powers would be registered without qualification. So far as third parties are concerned, once again the same problem exists even if two powers are created by two separate instruments. Indeed the problem may even worse for third parties, because there will be two separate original instruments, each bearing the Public Guardian's stamp. If there is only one instrument, the attorney acting for the time being will have the original. In addition, since non-fulfilment of a condition precedent contained in an instrument is not a valid ground for objection, a third party may still face the difficulty of knowing whether a conditional registered enduring power of attorney has come into operation, whichever construction of the Act is the right one.
iii) Mr Rees did suggest in oral argument that the fact that there was only one original stamped instrument might present a problem if the instrument purported to appoint successive attorneys. But that problem (if it is a problem) would exist in any case where more than one attorney is appointed to act concurrently, and (if it is a problem) would be particularly acute where the attorneys may act jointly and severally, because one attorney, acting alone, might not have the original instrument. And, as I have pointed out, the existence of only one original stamped instrument may itself guard against potential abuse of a registered enduring power of attorney where two or more powers would otherwise have been registered without qualification.
i) The principal policy objective of the 1985 Act was to abolish the common law rule that a power of attorney was revoked by the subsequent mental incapacity of the donor. The construction for which W contends does not undermine that policy.
ii) At common law, the appointment of successive attorneys is valid, and where the meaning of an Act is doubtful, Parliament is taken to have intended the least alteration of the common law.
iii) The Mental Capacity Act 2005, in which the current provisions are to be found, has as one of its policy objectives the encouragement of autonomy of protected persons. The Law Commission's report, on which the 1985 Act was based, also stressed the importance of the principle that people should be able to make such arrangements for the management of their affairs as they please.
iv) The Schedule should not be construed so as to leave technical traps for donors of powers, where the effect of falling into the trap may be irremediable once the problem has been identified.
v) There can be no doubt that a will appointing alternative or successive trustees would be valid to deal with the management of the affairs of a deceased person after his death. Why should it be any different for the management of his affairs during his lifetime?
"A power of attorney which gives the attorney a right to appoint a substitute or successor cannot be an enduring power."
Enduring power of attorney to survive mental incapacity of donor
1 (1) Where an individual has created a power of attorney which is an enduring power within the meaning of this Schedule—
(a) the power is not revoked by any subsequent mental incapacity of his,
(b) upon such incapacity supervening, the donee of the power may not do anything under the authority of the power except as provided by sub-paragraph (2) unless or until the instrument creating the power is registered under paragraph 13, and
(c) if and so long as paragraph (b) operates to suspend the donee's authority to act under the power, section 5 of the Powers of Attorney Act 1971 (c. 27) (protection of donee and third persons), so far as applicable, applies as if the power had been revoked by the donor's mental incapacity,
and, accordingly, section 1 of this Act does not apply.
Characteristics of an enduring power of attorney
2 (1) Subject to sub-paragraphs (5) and (6) and paragraph 20, a power of attorney is an enduring power within the meaning of this Schedule if the instrument which creates the power—
(a) is in the prescribed form,
(b) was executed in the prescribed manner by the donor and the attorney, and
(c) incorporated at the time of execution by the donor the prescribed explanatory information.
(2) In this paragraph, "prescribed" means prescribed by such of the following regulations as applied when the instrument was executed—
(a) the Enduring Powers of Attorney (Prescribed Form) Regulations 1986,
(b) the Enduring Powers of Attorney (Prescribed Form) Regulations 1987,
(c) the Enduring Powers of Attorney (Prescribed Form) Regulations 1990,
(d) the Enduring Powers of Attorney (Welsh Language Prescribed Form) Regulations 2000.
(3) An instrument in the prescribed form purporting to have been executed in the prescribed manner is to be taken, in the absence of evidence to the contrary, to be a document which incorporated at the time of execution by the donor the prescribed explanatory information.
(4) If an instrument differs in an immaterial respect in form or mode of expression from the prescribed form it is to be treated as sufficient in point of form and expression.
(5) A power of attorney cannot be an enduring power unless, when he executes the instrument creating it, the attorney is—
(a) an individual who has reached 18 and is not bankrupt, or
(b) a trust corporation.
(6) A power of attorney which gives the attorney a right to appoint a substitute or successor cannot be an enduring power.
(7) An enduring power is revoked by the bankruptcy of the donor or attorney.
(8) But where the donor or attorney is bankrupt merely because an interim bankruptcy restrictions order has effect in respect of him, the power is suspended for so long as the order has effect.
(9) An enduring power is revoked if the court—
(a) exercises a power under sections 16 to 20 in relation to the donor, and
(b) directs that the enduring power is to be revoked.
(10) No disclaimer of an enduring power, whether by deed or otherwise, is valid unless and until the attorney gives notice of it to the donor or, where paragraph 4(6) or 15(1) applies, to the Public Guardian.
Scope of authority etc. of attorney under enduring power
3 (1) If the instrument which creates an enduring power of attorney is expressed to confer general authority on the attorney, the instrument operates to confer, subject to—
(a) the restriction imposed by sub-paragraph (3), and
(b) any conditions or restrictions contained in the instrument,
authority to do on behalf of the donor anything which the donor could lawfully do by an attorney at the time when the donor executed the instrument.
Duties of attorney in event of actual or impending incapacity of donor
4 (1) Sub-paragraphs (2) to (6) apply if the attorney under an enduring power has reason to believe that the donor is or is becoming mentally incapable.
(2) The attorney must, as soon as practicable, make an application to the Public Guardian for the registration of the instrument creating the power.
(3) Before making an application for registration the attorney must comply with the provisions as to notice set out in Part 3 of this Schedule.
(4) An application for registration—
(a) must be made in the prescribed form, and
(b) must contain such statements as may be prescribed.
Registration of instrument creating power
13 (1) If an application is made in accordance with paragraph 4(3) and (4) the Public Guardian must, subject to the provisions of this paragraph, register the instrument to which the application relates.
(2) If it appears to the Public Guardian that—
(a) there is a deputy appointed for the donor of the power created by the instrument, and
(b) the powers conferred on the deputy would, if the instrument were registered, to any extent conflict with the powers conferred on the attorney,
the Public Guardian must not register the instrument except in accordance with the court's directions.
(3) The court may, on the application of the attorney, direct the Public Guardian to register an instrument even though notice has not been given as required by paragraph 4(3) and Part 3 of this Schedule to a person entitled to receive it, if the court is satisfied—
(a) that it was undesirable or impracticable for the attorney to give notice to that person, or
(b) that no useful purpose is likely to be served by giving him notice.
(4) Sub-paragraph (5) applies if, before the end of the period of 5 weeks beginning with the date (or the latest date) on which the attorney gave notice under paragraph 5 of an application for registration, the Public Guardian receives a valid notice of objection to the registration from a person entitled to notice of the application.
(5) The Public Guardian must not register the instrument except in accordance with the court's directions.
(6) Sub-paragraph (7) applies if, in the case of an application for registration—
(a) it appears from the application that there is no one to whom notice has been given under paragraph 5, or
(b) the Public Guardian has reason to believe that appropriate inquiries might bring to light evidence on which he could be satisfied that one of the grounds of objection set out in sub-paragraph (9) was established.
(7) The Public Guardian—
(a) must not register the instrument, and
(b) must undertake such inquiries as he thinks appropriate in all the circumstances.
(8) If, having complied with sub-paragraph (7)(b), the Public Guardian is satisfied that one of the grounds of objection set out in sub-paragraph (9) is established—
(a) the attorney may apply to the court for directions, and
(b) the Public Guardian must not register the instrument except in accordance with the court's directions.
(9) A notice of objection under this paragraph is valid if made on one or more of the following grounds—
(a) that the power purported to have been created by the instrument was not valid as an enduring power of attorney,
(b) that the power created by the instrument no longer subsists,
(c) that the application is premature because the donor is not yet becoming mentally incapable,
(d) that fraud or undue pressure was used to induce the donor to create the power,
(e) 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.
(10) If any of those grounds is established to the satisfaction of the court it must direct the Public Guardian not to register the instrument, but if not so satisfied it must direct its registration.
(11) If the court directs the Public Guardian not to register an instrument because it is satisfied that the ground in sub-paragraph (9)(d) or (e) is established, it must by order revoke the power created by the instrument.
(12) If the court directs the Public Guardian not to register an instrument because it is satisfied that any ground in sub-paragraph (9) except that in paragraph (c) is established, the instrument must be delivered up to be cancelled unless the court otherwise directs.
Register of enduring powers
14 The Public Guardian has the function of establishing and maintaining a register of enduring powers for the purposes of this Schedule.
Effect and proof of registration
15 (1) The effect of the registration of an instrument under paragraph 13 is that—
(a) no revocation of the power by the donor is valid unless and until the court confirms the revocation under paragraph 16(3);
(b) no disclaimer of the power is valid unless and until the attorney gives notice of it to the Public Guardian;
(c) the donor may not extend or restrict the scope of the authority conferred by the instrument and no instruction or consent given by him after registration, in the case of a consent, confers any right and, in the case of an instruction, imposes or confers any obligation or right on or creates any liability of the attorney or other persons having notice of the instruction or consent.
Application to joint and joint and several attorneys
20 (1) An instrument which appoints more than one person to be an attorney cannot create an enduring power unless the attorneys are appointed to act—
(a) jointly, or
(b) jointly and severally.
(2) This Schedule, in its application to joint attorneys, applies to them collectively as it applies to a single attorney but subject to the modifications specified in paragraph 21.
(3) This Schedule, in its application to joint and several attorneys, applies with the modifications specified in sub-paragraphs (4) to (7) and in paragraph 22.
(4) A failure, as respects any one attorney, to comply with the requirements for the creation of enduring powers—
(a) prevents the instrument from creating such a power in his case, but
(b) does not affect its efficacy for that purpose as respects the other or others or its efficacy in his case for the purpose of creating a power of attorney which is not an enduring power.
(5) If one or more but not both or all the attorneys makes or joins in making an application for registration of the instrument—
(a) an attorney who is not an applicant as well as one who is may act pending the registration of the instrument as provided in paragraph 1(2),
(b) notice of the application must also be given under Part 3 of this Schedule to the other attorney or attorneys, and
(c) objection may validly be taken to the registration on a ground relating to an attorney or to the power of an attorney who is not an applicant as well as to one or the power of one who is an applicant.
(6) The Public Guardian is not precluded by paragraph 13(5) or (8) from registering an instrument and the court must not direct him not to do so under paragraph 13(10) if an enduring power subsists as respects some attorney who is not affected by the ground or grounds of the objection in question; and where the Public Guardian registers an instrument in that case, he must make against the registration an entry in the prescribed form.
(7) Sub-paragraph (6) does not preclude the court from revoking a power in so far as it confers a power on any other attorney in respect of whom the ground in paragraph 13(9)(d) or (e) is established; and where any ground in paragraph 13(9) affecting any other attorney is established the court must direct the Public Guardian to make against the registration an entry in the prescribed form.
(8) In sub-paragraph (4), "the requirements for the creation of enduring powers" means the provisions of—
(a) paragraph 2 other than sub-paragraphs (8) and (9), and
(b) the regulations mentioned in paragraph 2.
Joint attorneys
21 (1) In paragraph 2(5), the reference to the time when the attorney executes the instrument is to be read as a reference to the time when the second or last attorney executes the instrument.
(2) In paragraph 2(6) to (8), the reference to the attorney is to be read as a reference to any attorney under the power.
(3) Paragraph 13 has effect as if the ground of objection to the registration of the instrument specified in sub-paragraph (9)(e) applied to any attorney under the power.
(4) In paragraph 16(2), references to the attorney are to be read as including references to any attorney under the power.
(5) In paragraph 16(4), references to the attorney are to be read as including references to any attorney under the power.
(6) In paragraph 17, references to the attorney are to be read as including references to any attorney under the power.
Joint and several attorneys
22 (1) In paragraph 2(7), the reference to the bankruptcy of the attorney is to be read as a reference to the bankruptcy of the last remaining attorney under the power; and the bankruptcy of any other attorney under the power causes that person to cease to be an attorney under the power.
(2) In paragraph 2(8), the reference to the suspension of the power is to be read as a reference to its suspension in so far as it relates to the attorney in respect of whom the interim bankruptcy restrictions order has effect.
(3) The restriction upon disclaimer imposed by paragraph 4(6) applies only to those attorneys who have reason to believe that the donor is or is becoming mentally incapable.
Note:
1. This form may be adapted to provide for execution by a corporation
2. If there is more than one attorney additional sheets in the form as shown below must be added to this Part C