Re PC; Public Guardian v AC & JC [2014] EWCOP 41

Analysis

PC was born in 1936. She suffered from vascular dementia and Alzheimer’s disease. In June 2009, she had executed an LPA for property and affairs, appointing her sons, AC and JC, as her attorneys jointly and severally. The LPA was registered on 12 August 2009. In June 2013, an application to the Court of Protection was made by the Public Guardian (OPG) for an order revoking the LPA, and directing them to account to the OPG for their dealings under the LPA. The OPG had been informed that the attorneys had not been paying their mother’s care fees and that arrears had accumulated, funds had been taken from PC in the form of lump sum payments amounting to £15,000 and unexplained withdrawals amounting to £150,347.45.

JC maintained that the payments were justified on the basis that they reduced her estate taxable to inheritance tax, that she had an income surplus and was therefore secure, and that otherwise he and his family would have found themselves homeless and dependent on state benefits.

Held:

1. 1) Under s22 of the Mental Capacity Act (the Act), the court had to be satisfied that PC lacked capacity to revoke the LPA herself, and that the attorneys had behaved in a way that contravened their authority or was not in her best interests.
2. 2) PC lacked capacity to revoke the LPA herself. She had advanced dementia, and it was not possible to determine whether she was happy with the ways JC and AC acted for her.
3. 3) JC had mingled his mother’s money with his own money and his company’s funds. He had failed to provide a satisfactory explanation for payments totalling £150,347.45.
4. 4) This conduct constituted serious breaches of his fiduciary duties and were not in PC’s best interests. JC’s appointment was therefore revoked. As to the argument that the LPA was used for inheritance tax planning purposes, the attorneys should have applied to the Court of Protection of an order under s23(4) of the Act. JC went ahead and structured his mother’s affairs without obtaining a court order authorising him to do so.
5. 5) As to the possibility of limiting the registration to JC’s co-attorney, AC, acting as the sole attorney, AC had benefitted personally from his mother’s estate, in contravention of his authority as an attorney and had failed to respond satisfactorily to the Public Guardian’s application.
6. 6) Joint attorneys are jointly responsible and accountable and, having regard to all the circumstances AC had also contravened his authority and had not acted in PC’s best interests.
7. 7) The LPA was to be revoked, and a panel of deputies were invited to apply to be appointed as PC’s deputy for property and affairs.

JUDGMENT SENIOR JUDGE LUSH: [1] This is an application by the Public Guardian for the court to revoke a lasting power of attorney (LPA) for property and financial affairs and to direct him to cancel its registration. The background [2] PC was born in 1936 and was formerly a primary school teacher. Her husband, who …

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