Re OL [2015] EWCOP 41

Analysis

OL was born on 15 November 1937. Her husband died in 1993. She had three children: an elder son (ES) who is 53, a daughter (DA) aged 51 and a younger son (YS) aged 48.

OL used to live in a maisonette in Stockwell, London. In 2010, DA moved in with OL ostensibly to look after her. In 2011, OL was diagnosed with vascular dementia and on 17 July 2013 she suffered a stroke. According to ES, OL scored 8 out of 30 on a mini mental state examination on 21 August 2013, suggesting that she had severe cognitive impairment at that time.

On 19 October 2013, OL executed a lasting power of attorney (LPA) for property and affairs and an LPA for health and welfare appointing DA and YS jointly and severally as her attorneys. The LPA was registered on 11 December 2013.

In June 2014, ES contacted OPG expressing concerns about the sale of OL’s maisonette and purchase of a house in Croydon into which OL and DA moved together.

The Public Guardian (OPG) opened investigation and gathered evidence symptomatic of financial abuse. The OPG applied to the court for an order (a) revoking and cancelling the LPA for property and financial affairs because the attorneys used their power carelessly and irresponsibly and (b) directing that a member of the panel of deputies be invited to make an application to be appointed to make decisions on behalf of OL in relation to her property and financial affairs.

The OPG contended that:

1. (a) OL’s maisonette was sold for £730,000 and the property into which she and DA moved was bought for £430,000 entirely with OL’s funds;
2. (b) OL and the two attorneys subsequently executed a declaration of trust stating that OL has only a 20% share in the property (worth £86,000) whereas the attorneys had a 40% share each which represented an outright gift of £172,000 to each of them;
3. (c) A firm of conveyancing solicitors in Chelmsford acted for them and drew up the declaration of trust;
4. (d) The OPG wrote to both attorneys on 22 July and 5 August 2014 asking for a full account of their dealings but did not receive accounts from them;
5. (e) £127,885 of OL’s money was used to pay off DA’s mortgage on a property she still owns, which is divided into two flats, one of which she lets at £850 per month;
6. (f) £80,000 of OL’s money was used for building work and conversion to DA’s property;
7. (g) In the period of six months, OL went from owning her own property worth £730,000 to having only £7,000 in her bank account and a 20% share in the Croydon property;
8. (h) A Court of Protection general visitor visited OL on 27 July 2014 and concluded that she did not have capacity to revoke the LPA.

ES supported the OPG’s application to revoke and cancel the LPA and asked the court to consider appointing him either as sole or joint deputy alongside another deputy selected from the panel of deputies.

In advance of the hearing, DA opposed the application, contending that she had not breached her fiduciary duty to OL and acted entirely in OL’s best interests. She asserted that any money spent on her or YS was spent for OL’s benefit and the LPA was not used for the sale and purchase of property.

During the hearing, the attorneys submitted that they were willing to stand down for the appointment of a panel of deputies but opposed the appointment of ES as a deputy.

Held:

1. 1. 1) The current issue before the court was whether the attorneys had behaved in a way that contravened their authority or was not in OL’s best interests. Questions regarding OL’s capacity to make substantial lifetime gifts or whether she had been unduly influenced were matters for another day.
   2. 2) The Mental Capacity Act 2005 Code of Practice describes ten duties that an attorney appointed under an LPA has towards a donor including: a fiduciary duty, a duty to keep accounts and a duty to keep the donor’s money and property separate.
   3. 3) Section 22 of the Mental Capacity Act 2005 describes the circumstances in which the Court of Protection may revoke an LPA.
   4. 4) The attorneys behaved in a way that contravened their authority or was not in OL’s best interests. Their failure to keep accounts of the transactions carried out on OL’s behalf or produce any record would alone be sufficient to warrant revocation. This was compounded by them taking colossal advantage of their position and obtaining personal benefits far in excess of the limited power that attorneys have to make gifts of the donor’s property.
   5. 5) OL lacked capacity to revoke the LPA.
   6. 6) Regarding the appointment of ES, the court was not satisfied that he had sufficient detachment or impartiality to manage OL’s affairs.
   7. 7) To appoint a panel deputy authorised to take such necessary steps to restore OL’s estate so far as possible to the position in which it would have been before the attorneys began acting recklessly and irresponsibly.

8) In view of the attorneys conduct, no order as to costs.

JUDGMENT LUSH J: [1] ‘An attorney takes on a role which carries a great deal of power, which they must use carefully and responsibly’: Mental Capacity Act Code of Practice, para 7.58. [2] This is an application by the Public Guardian for the court to revoke a lasting power of attorney (LPA) for property and …

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