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A delicate exercise

Statutory Wills prior to the Mental Capacity Act 2005

Before the Mental Capacity Act 2005 ("MCA 2005") came into force in October 2007 the Mental Health Acts of 1959 and 1983 governed the Court's authority to make decisions in relation to the affairs of adults who had lost capacity. The Administration of Justice Act 1969 enabled the Court to approve a will on behalf of an incapacitated person and in deciding what that statutory will should contain the Court used a process of substituted judgment. This involved stepping into the incapacitated testator's shoes to determine what he would reasonably have done having regard to his specific circumstances. The process was based on an assumption that the testator would be having a brief lucid interval during which he would fully recall the past. In the absence of any detailed information about the testator the Court adopted the assumption that he was"a normal decent person acting in accordance with contemporary standards of morality".
 
The position after the 2005 Mental Capacity Act
 
The MCA 2005 introduced a new legislative framework dealing with the loss of mental capacity and section 18 (1) (i) of the act gives the Court of Protection power to order the execution of a will on behalf of anyone over 18 who lacks capacity to make one themselves. Such a will made by the Court for someone who has lost capacity has the same effect as if he or she had capacity to make a valid will and executed that will in accordance with the provisions of the Wills Act 1837 save that statutory wills do not cover immoveable property situated outside England and Wales.
 
An application for a statutory will should be considered whenever there is a significant change in the life of the person who lacks capacity. The death of a spouse or a change in the financial circumstances of the testator or a close family member might prompt a review of existing arrangements in much the same way that a testator with capacity might be expected to review and amend his testamentary provision after a significant life-event.
 
For the purposes of MCA 2005 a person lacks capacity "if at the material time he is unable to make a decision for himself in relation to the matter because of an impairment of, or a disturbance in the functioning of, the mind or brain" (section 2(1) MCA 2005).
 
An individual may have capacity to make some decisions, but not others and therefore it will not necessarily follow that because someone is unable to deal with their day to day affairs they automatically lack capacity to decide how they would like their estate to be distributed.
 
Any question as to whether someone currently lacks capacity is decided by the Court of Protection on the balance of probabilities adhering to the criteria set out in section 3 MCA 2005. Section 3 states that (for the purposes of section 2) a person is unable to make a decision for himself if he is unable to: (i) understand the information relevant to the decision, (ii) retain that information for long enough to make the decision, (iii) use or weigh that information as part of the decision-making process or (iv) to communicate his decision.
 
Applications for statutory wills are often made where there are concerns about the validity of the last existing will made by the person who lacks capacity. However, it is important to note that the Court of Protection has no jurisdiction to make a ruling about the validity of any existing Will -any such proceedings must be brought in the Chancery Division in accordance with the provisions of the Civil Procedure Rules. There is moreover an important distinction between the way that the Court of Protection and the Chancery Division approach the assessment of testamentary capacity.
 
In a statutory will application the Court of Protection is bound by the provisions of MCA 2005 and has to apply the statutory test as set out in sections 2 and 3 of that act when determining a person's current capacity to make a will. Judges in the Chancery Division however are not compelled to apply the statutory test when determining retrospectively whether a testator lacked capacity to make a valid Will and have continued to adopt a common law approach based on the test propounded in Banks v Goodfellow (1870) LR 5QB 549.
 
Cases decided in the Chancery Division after the introduction of the MCA 2005 generally suggest that the statutory test does not add anything further to the existing common law test. However, there are still a number of subtle differences between the two tests, for example, the Banks v Goodfellow test does not refer to the retention of information or the communication of information specified in section 3 of the MCA 2005. Further, under common law, although there is a presumption of capacity, the burden of proof in relation to testamentary capacity can shift whereas under the MCA 2005 the evidential burden of proving that an individual lacks capacity always lies with the person alleging incapacity.
 
Best interests
 
One of the five statutory principles set out in S 1 of the MCA 2005 is that "an act done or decision made under this act for or on behalf of a person who lacks capacity must be done, or made, in his best interests". Hence in exercising its jurisdiction to make a statutory will the court must undertake an exercise to establish what is in the best interests of the individual concerned.
 
Guidance as to the concept of "best interests" is provided in section 4 MCA 2005 which provides a checklist of factors that should be taken into account. Section 4 provides (inter alia) that the person making the determination must consider all the relevant circumstances and in particular, to consider so far as is reasonably ascertainable) the following:
(i) the person's past and present wishes and feelings and any relevant written statement made by him when he had capacity (including any existing wills or codicils),
(ii) The beliefs and values that would be likely to influence his decision if he had capacity,
((iii) the other factors he would be likely to consider if he were able to do so.
 
The person making the determination should take into account (if it is practicable and appropriate to consult them) the views of anyone engaged in caring for the person or interested in his welfare and any court appointed deputy or donee of a Lasting Power of Attorney as to what would be in the person's best interests. Further, so far as is reasonably practicable, the individual concerned must be permitted and encouraged to participate as fully as possible in any act done for him or decision made on his behalf.
 
NT v FS and Others [2013] EWHC 684 (COP) and the applicability of the determination of "best interests"
 
Since the MCA 2005 came into force a number of different approaches have been taken in undertaking the best interests exercise and the weight to be accorded to the various factors. In the recent case of NT v FS and Others Behrens J provided a helpful summary of guidance from the main body of authorities as to the matters to which the Court must have regard when determining the provisions of a statutory will.
 
NT v FS and Others was an application by the appointed Deputy for authority to execute a statutory will on behalf of FS ("F"). There was no dispute that F lacked capacity to make a will and nor was there any dispute that it was in his best interests for such a will to be made. However, there were nine named respondents to the application, all of whom were potential beneficiaries and there was considerable dispute between them as to what the provisions of the will should be. F was a former professional rugby league player who had qualified as an electrician before turning his hand to property development.  At the time of the application he was aged 74 and suffering from moderate to severe Alzheimers and dementia. He was described in evidence as a secretive man who had led a compartmentalised life to the extent that his current partner with whom he had been living for 24 years had not met his family until 2005 when she telephoned them and did not know the extent of his assets until he was suffering from dementia.
 
In the course of submissions the Judge was directed to four authorities -Re P [2009] EWHC 163 (Ch), Re M [2011]1 WLR 344, Re G (TJ) [2011] WTLR 231 and Re J (C) [2012] WTLR 121  from which he summarised the following guidance:
 
(i) The overarching principle is that any decision made on behalf of the individual for whom the statutory will is being made must be in his or her best interests. It is important to recognise that this is not the same as asking what that individual would have decided if he or she had capacity. The test is an objective one, not the test of substituted judgment which would have applied prior to the MCA 2005.
 
(ii) The Court must follow the structured decision-making process laid down by MCA 2005 and consider all relevant circumstances. In particular the Court must consider and take into account the matters set out in sections 4(6)-(7) MCA 2005.
 
(iii) The Court must then make a value judgment giving effect to the paramount statutory concern that the decision must be made in the best interests of the person for whom the will is being drawn up.
 
(iv)There is no hierarchy between the various best interest factors and their weight will differ depending on the individual circumstances. However, in any particular case there may be one or more features which are of "magnetic importance" in influencing or determining the outcome.
 
(iv) The authorities differ as to the weight to be attached to the wishes and feelings of the person for whom the will is being made. There is a degree of disagreement between the authorities as to whether there is a presumption in favour of implementing such wishes, or whether those wishes are simply always a significant factor. What is clear is that the weight attributable to such wishes and feelings will always depend on individual circumstances and will be case specific and fact specific.
 
(v) The authorities differ as to the relevance to the decision maker of the person who lacks capacity "having done the right thing" by his will and being remembered for that after his death.
 
Although F had not previously executed a Will a manuscript document in his handwriting had been found in a bible. The document was headed "Will of F…"and set out various pecuniary legacies. The document was not witnessed or dated and did not create a valid will, but there was evidence from a number of the beneficiaries that F had told them he had created a Will and so he may have thought he had done so. From the addresses given in the document the parties were able to agree that it was probably created between 1984 and 1986. The parties expressed differing views as to the importance of this document and the weight that should be accorded to it. Behrens J decided that it was a document which fell within section 4(6) of MCA 2005 which meant that it had to be considered, but was not of "magnetic importance". Further, the "1986 document" as it is referred to in the Judgment should not be taken as a starting point for determining F's best interests in relation to the terms of the statutory will.
 
Although  the case  of NT v FS and Others is fact specific it is interesting to see how the Judge made his value judgement ensuring that the final decision was made in F's best interests.
 
Among the factors that the Court did consider were F's moral obligations to the parties and their moral claims on his bounty as well as the nature of their relationship with him and the extent to which they each contributed to his wealth.
 
The decision in NT v FS and Others illustrates the very subtle differences in judicial opinion over the impact of the views of the person lacking capacity when evaluating what constitutes "best interests". It is clear from the authorities that the individual's past and present wishes and feelings will always be a significant factor whose weight will vary according to the particular circumstances. What is less clear is how that person should be remembered.
 
In Re P (ibid) Lewison J said "…what will live on after P's death is his memory; and for many people it is in their best interests that they be remembered with affection by their family and as having done "the right thing" by their will. In my judgement the decision maker is entitled to take into account, in assessing what is in P's best interests, how he will be remembered after his death".
 
However, Morgan J (ibid) and Senior Judge Lush in Re J(C) (ibid)  have expressed doubts about following this approach. In the latter case J had a history of doing "the wrong thing" and it was said that it would be unrealistic to expect him to have a complete turnaround simply because he lacked capacity. In Re G Morgan J pointed out that it was the Court that was making the gift and/or the terms of the Will rather than the individual concerned and that those family members who were unsuccessful in their claims were unlikely to think that he had done "the right thing".
 
In NT v FS and Others Behrens J preferred to follow the views expressed by Morgan J in Re G and chose not to place any weight on this factor.
 
In his summing up the Judge noted that F's current longterm partner had a potential claim under the Inheritance (Provision for Family and Dependants) Act 1975 against his estate (albeit any such claim would be limited to her reasonable maintenance) and that F had a significant moral obligation to her. In addition the Judge agreed that F's only child had strong moral claims on his bounty and made specific reference to the fact that there had been a normal relationship between Father and son and that the son was married with a young family of his own. Nevertheless, the Judge also agreed that other members of the family had made significant contributions to F's wealth and that were it not for those contributions the value of the estate would probably have been significantly less. The Judge attached some weight to the 1986 manuscript document as demonstrating that F wished to recognise that contribution by making provision for his family out of his estate and accordingly awarded 35% of F's estate to his longterm partner, 43% to his son and 22% divided between the other family respondents (save for F's 95 year old Mother to whom the Deputy was to pay £50,000 by way of gift).
 
Conclusion

It is often difficult to assess what is in the best interests of someone who has lost capacity particularly because the consequences of any decisions made in the context of a statutory will application will only become apparent after their death. NT v FS and Othersis one of the few reported statutory wills cases since the MCA 2005 came into force and the Judge's distilled guidance on the application of the best interests will be welcomed by practitioners in this area of law.

This article originally appeared in Trusts and Estates Law & Tax Journal in November 2013. Read more about trusts, wills and estates.

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