Ruth Hughes acted in Re Public Guardians Severance Applications [2023] EWCOP 24, which was handed down on 9 June 2023.
Ruth Hughes acted in Re Public Guardians Severance Applications [2023] EWCOP 24, which was handed down on 9 June 2023. The judgment involved nine cases raising questions regarding the validity of certain provisions within Lasting Powers of Attorney (‘LPAs’).
The first question was whether it is lawful to give primary power to one attorney ahead of other attorneys when appointed on a joint and several basis. The court held it was not, as attorneys can only hold power in three capacities pursuant to section 10(4) of the Mental Capacity Act 2005 (the ‘MCA’): “(a) jointly, (b) jointly and severally, or (c) jointly in respect of some matters and jointly and severally in respect of others.” When multiple donees are appointed on a joint and several basis, equality must prevail and therefore the Public Guardian must apply to the court for severance of any provision nominating a primary attorney.
The second point was whether it is lawful to have joint and several appointments with instructions for attorneys to deal with separately defined areas of the donor’s affairs or include restrictions to this effect, such as one attorney to deal with business assets and another to deal with family assets. Hayden J held that this is undesirable, as it could lead to practical issues, and once again, is incompatible with the wording in section 10. An LPA subject to these terms could therefore not be registered, and Hayden J noted it might be appropriate to create multiple separate LPAs instead.
The third question faced by the court was whether severance applications ought to continue to be made where instruments seek to instruct multiple (original or replacement) attorneys to act on a majority basis. Hayden J held that this was the correct mechanism due to the strict provisions in section 10(4), but he expressed some frustration with this result.
The fourth point queries whether “should” or similar words constitute a binding instruction or a non-binding preference on the part of the donor. For example, one of the LPAs involved in the case read: “any decision should be made by a majority of attorneys”. Hayden J held that it was obvious from the specific facts of that case that the donor had an intention that decisions be made either by agreement or majority, and the word “should” could be interpreted to that effect. This intention could be respected without doing violence to the language of the statute, and severance was not required. The court declined to give any more general legal guidance on the use of the word “should”, but signalled that it need not automatically give rise to severance.
Point five concerns whether it is lawful for the donor to replace a replacement attorney. This involves a situation which arose in one of the LPAs in the case which stated: “[G] is to be the first replacement attorney. Should [G] not be able to act or refuse to act as the replacement attorney, then [C] is to act as the replacement attorney”. This invoked section 10(8) of the MCA, which provides that donees cannot themselves appoint substitute successors. However, as Hayden J pointed out, section 10(8) does express that an LPA may itself appoint a person to replace the donee in the event that the principal donee’s appointment is terminated. The court considered the legislation’s goal to protect the autonomy of those who lack capacity, and took a purposive interpretation in holding that this instruction was valid, as it can be read as providing a replacement attorney if G does not act, which is permissible, as opposed to providing an instruction that G themselves must appoint C as a second replacement.
The judgment reviews the history and consultations behind the MCA provisions, and expresses the need for legislative amendment, as well as suggesting that the wording in the LPA forms be changed. For example, it notes that the MCA limits the authority conferred by an LPA to “any conditions or restrictions specified in the instrument”. However, on the forms for registration of an LPA, the language has been altered to instead include reference to “preferences” and “instructions”. This has been the subject of judicial criticism, which Hayden J echoed throughout his judgment. To read the full judgement please click here