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When the court steps in

The pitfalls in preparing a lasting power of attorney (LPA) are all too many for anyone who wants to give another person power to act on his behalf, in relation to his property and financial affairs. This might be to deal with unforeseen circumstances, such as sudden illness, incapacity or simply for convenience. An LPA is the kind of power that is needed if the donor wants the power to remain valid even if he/she loses capacity, as opposed to a general power of attorney which ceases on incapacity. LPAs, however, are lengthy and cumbersome to complete - uncrossed boxes, failing to complete all parts of the form, signatures not properly witnessed or names, addresses and dates of birth omitted are among the most common defects.

In Re Barker, for example, Mr Barker made an LPA in January 2008. On registration there were two difficulties: (a) his son objected and (b) the Office of Public Guardian (OPG) rejected the application as the solicitor who provided the certificate of the donor's mental capacity had not crossed the first of the two boxes at the beginning of the certificate to confirm that he was not disqualified from providing it. On 1 May 2008 Mr Baker created another LPA, and unfortunately the solicitor repeated the same mistake on the certificate.

Mistakes in LPAs generally come to light within a few months of their creation, when an application to register is made and queries are raised. Donors are encouraged to register once the LPA is created and it is not effective at all until registered. The risk of postponing registration is that problems will come to light only at a later stage and possibly when it is no longer possible for the donor to make a new LPA.

By contrast, errors in the predecessor powers to LPAs, namely enduring powers of attorney (EPAs) may take many years to come to light. This is because an EPA can be used prior to registration if the donor has not included a restriction that it can only be used after the onset of incapacity. By contrast, errors in the predecessor powers to LPAs, namely enduring powers of attorney (EPAs) may take many years to come to light. This is because an EPA can be used prior to registration unless the donor has included a restriction that it can only be used after the onset of incapacity. When an EPA needs to be registered, because of incipient incapacity, it is at that point that errors may first be noticed and the EPA then rejected. All may not be lost, however, as there are different kinds of defects that fall broadly into the following three categories:

• immaterial defects that can be easily rectified;
• more substantive defects that can be remedied, for example, by severing an offending clause; and
• material defects that cannot be remedied.

Immaterial defects in EPAs

Various defects on the face of EPAs have been considered immaterial by the OPG. These are usually where some evidential information is missing that can be easily supplied, such as the date of birth of the donor. There have been particular instances where the date an EPA was signed was omitted and another where the address of the witness was missing. The EPAs were accepted once extrinsic evidence was forthcoming.

Substantive defects that may be remedied

In Re Smith, the prescribed wording on Part C of the EPA form signed by the attorney had accidently been deleted but the Court of Protection reinstated the words and registered the EPA.
An EPA may include unpermitted directions or restrictions. In such a case, it may be possible to sever the offending provision(s) and the Court of Protection often takes a pragmatic approach.
In Re Bridge, the Court of Protection reviewed the following provision concerning the authority to act of joint and several attorneys: 'Two of the three can deal with any household or everyday expenses, but for any other issues I would like all three attorneys to be signatories'.' What might be regarded as 'household or everyday expenses' and who could decide which 'two of the three' attorneys should act? This offending restriction was severed.

Two attorneys were appointed in Re Rayner, to act jointly and severally for all property affairs. The donor then restricted them from acting where she owned property jointly with them, appointing a different attorney. The Court of Protection severed this restriction, leaving the first two attorneys to act.

Material defects

Material defects that cannot be rectified will render the EPA invalid. These might include instances where essential parts of the EPA have been omitted, dates are wrong (such as where the attorney has executed the power before the donor), or signatures or names are missing.

If an EPA fails to meet the requirements for a valid EPA, it may nonetheless be recognised as an ordinary power. This is not the case for a failed LPA because the statute provides that an instruction which purports to create an LPA but does not comply with the requirements of the legislation 'confers no authority'.

Although it has not been possible to make an EPA since 1 October 2007, many were created before that date and can still be used. Indeed, many were created within the last month or so of that deadline so that the question of defects and whether and how they can be remedied will remain an issue for some time to come.

This article first appeared in the STEP Journal in December 2013. Find out more about our Private Wealth services. 

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