Scottish Sheriff Court Decisions

AW267/09

Application by the Public Guardian for Directions

Sheriff J A Baird

Point at Issue in the Case

1. This case concerns the statutory rules which oblige the Public Guardian to register continuing and welfare powers of attorney, and any revocations thereof, which when received by her comply with the prescribed statutory requirements, and the basis on which she can ask the court to direct her to refrain from registering any such document received. I am given to understand that this is the first occasion on which the Public Guardian has sought directions from the court by utilising the powers contained in section 3(3) of the Adults with Incapacity (Scotland) Act 2000.

Legislative Background

2. Section 15 of that Act provides that where an individual grants a power of attorney (hereafter "P of A") relating to her property or financial affairs in accordance with the provisions of that section, the P of A shall continue to have effect in the event of the granter's becoming incapable in relation to decisions about the matter to which the P of A relates, notwithstanding any rule of law to the contrary.
3. Provided the remaining provisions of the section are complied with, the document is known as a "continuing power of attorney" and the person on whom the power is conferred is referred to as a "continuing attorney".
4. To comply, the document must be subscribed by the granter, incorporate a statement which clearly expresses the granter's intention that the power be a continuing one, may contain a statement indicating by what method incapacity is to be determined, and, critically for present purposes, must incorporate a certificate in prescribed form by a practising solicitor or other prescribed person that the person completing that certificate has interviewed the granter immediately before the granter subscribes and is satisfied, either because of that person's own knowledge of the granter, or because that person has consulted another person who is named in the certificate and who has knowledge of the granter, that at the time the continuing P of A is granted, the granter understands its nature and extent, and that the person completing the certificate has no reason to believe that the granter is acting under undue influence or that any other factor vitiates the granting of the power (S15(3)(c)). If a practising solicitor is the person to whom the P of A is granted, that solicitor may not grant the certificate referred to (S15(4)).
5. Similarly, section 16 of the Act provides that an individual may grant a P of A relating to her personal welfare in accordance with the provisions of that section, such a document being described as a "welfare power of attorney" and the person on whom the power is conferred being referred to as a "welfare attorney". For such a document to be valid, that section, (S16(3)(c)), makes provision for the requirement to incorporate a certificate in similar terms to those set out in section 15(3)(c), with the same prohibition (S16(4)) as was contained in section 15(4) and noted above.
6. By section 19, a continuing or welfare attorney has no authority to act until the document conferring the power has been registered with the Office of the Public Guardian in accordance with the provisions of that section
7. . Where the document received for registration by the Public Guardian is in proper form, and the Public Guardian is satisfied that the person appointed is prepared to act, the document must be registered by her in the register maintained either for continuing powers of attorney (S6(2)(b)(i)) or welfare powers of attorney (S6(2)(b)(ii)). In other words, if the document received by the Public Guardian for registration complies with the prescribed statutory requirements, the Public Guardian is obliged to register it.
8. Section 22A of the Act provides that the granter of a continuing or welfare P of A may revoke it, or any of the powers granted by it, and after it has been registered, by giving a revocation notice to the Public Guardian. To be valid, such a notice of revocation has to be subscribed by the granter and incorporate a certificate in similar terms to those provided by section 15(3)(c) already set out above (S22A(2)(b)). Once again, where the Public Guardian receives such a notice, she must enter its particulars in the appropriate register. A revocation has effect when it is registered (S22A(4)).
9. Section 3 of the Act provides that the sheriff shall have certain powers in relation to functions exercised under it, and by virtue of section 3(3)(a), on an application by any person, (including the adult), claiming an interest in the property, financial affairs or personal; welfare of an adult, the sheriff may give such directions to any person exercising functions conferred by the Act as to the exercise of those functions and the taking of decisions or action in relation to the adult as appear to be appropriate. Of course, the Public Guardian exercises functions conferred by the Act, and accordingly the sheriff may give the Public Guardian directions in regard to them.

The Application before the Court

10. On 30 October 2009, the Public Guardian presented an application to the court under the terms of section 3(3) of the Act seeking directions with regard to the exercise of her functions under the Act, and specifically asking the court to determine if a P of A granted by an adult on 20 February 2007 in favour of a solicitor should be revoked and a subsequent P of A ostensibly granted by the same adult on 30 September 2009 in favour of a different person should be registered.
11. At the conclusion of the hearing on the case, the Public Guardian clarified the nature of the directions sought by indicating that she wished directions on whether a purported revocation of the P of A dated 20 February 2007, and which document was also dated 30 September 2009, should be registered, and whether the purported new P of A dated on that same date should be registered. In other words, the Public Guardian did not seek to have the original P of A revoked in some way, but merely to have the court direct that the purported revocation of the original document, and the purported replacement document, be not registered, the effect being that if such directions were given, the original P of A dated 20 February 2007 remains registered and operative.
12. It should be noted that in terms of section 6(da) of the Act, the Public Guardian has the statutory right to take part as a party in any proceedings before a court or to initiate such proceedings where she considers it necessary to do so to safeguard the property or financial affairs of an adult who is incapable for the purposes of the Act. In this case, she did both.

Factual Background to the Application

13. I shall attempt to set this out briefly, and since it would be invidious to have any of those involved capable of identification, and in an attempt to avoid that, I shall describe the principal participants only by reference to alphabetical symbols, and not even their own actual initials.
14. The adult, A, was born on 7 July 1922. At the time of the bringing of the proceedings by the Public Guardian she was 87 years old. She is a widow, with no children, and lives in her own home, which is a top (3^rd) floor tenement flat in Glasgow. She has significant mobility difficulties, requiring to use a Zimmer frame to walk. Subsequent medical information received showed that she has had a significant number of falls in recent years, probably caused by transient ischaemic attacks (mini-strokes).
15. In much younger life, she had worked as a domestic help with the family of a Glasgow solicitor, B. He became her lawyer. He had a daughter, C, who herself subsequently became a solicitor. The adult retired from work in the late 1990's, but she and C kept in touch as a result of the bond which had formed between them. C assisted informally over the intervening years in helping the adult to get to shops, for hospital appointments etc. She even took the adult away on holiday as recently as Easter 2008.
16. Over recent years, C noticed that the adult's health, and in particular her state of mind, was deteriorating. C had arranged the provision of "home helps" for the adult with the local authority.
17. The adult instructed C to draw up a continuing and welfare power of attorney in favour of C, and she did so, complying with the requirements of the Act in every respect. The P of A is signed by the adult, witnessed by an employee in C's office, dated 20 February 2007, and the required certificate is completed by another solicitor in C's office who has certified that he interviewed the granter immediately before she subscribed the continuing P of A. That document was then sent to the Public Guardian and registered by her on 25 May 2007.
18. The adult also advised C that she wished to make a will, and in fact did so twice, in 2006 and 2007. Having advised C that the adult wished C to be a beneficiary of her estate, C, in accordance with what I understand to be proper practice, did not act herself in any such transaction, but instead referred the adult to an independent solicitor, who then complied with the adult's instructions. Although I have not seen it, I understand there to be a will, signed by the adult sometime in 2007, in which she bequeaths part of her estate to C.
19. In about October 2009, C became aware that the adult had purportedly executed a Revocation of the P of A in favour of C dated 20 February 2007.
20. This purported Revocation was produced, and states, erroneously, that the P of A in favour of C is dated 25 February 2007. It is dated, as has already been stated, 20 February 2007. Leaving aside whether that error in drafting means that the purported revocation is of no effect anyway, since it purports to revoke a document which does not arguably exist, it narrates that the adult has lost confidence in C and withdraws the P of A issued in C's favour. This document was prepared by a different solicitor, D, ostensibly on the adult's instructions, and is dated 30 September 2009. The solicitor who prepared it and drafted it, D, has also acted as the witness to the adult's signature to it, and has also completed the statutory certificate required.
21. On the same date, 30 September 2009, the adult purportedly signed a new P of A, appointing a different person to be her continuing attorney and welfare attorney. The person appointed, E, is a lay person and apparent friend of the adult. Once again, the adult's signature on this document has been witnessed by D, who again prepared it and drafted it, and D has also completed the required statutory certificate on this document.
22. In the case of both statutory certificates, the solicitor, D, has made the certification based on that solicitor's "own knowledge of the granter".
23. It subsequently emerged that at the same time, 30 September 2009, the adult signed and executed a new will, in which she apparently has deleted any reference to C being a beneficiary. I make it clear that that document is not before the court in these proceedings. Any question as to its validity will have to be made the subject of separate challenge, if any.
24. Having come to learn of the signing of the purported Revocation and of the purported new P of A, C became concerned that there may have been undue influence exercised by E on the adult, on account of her vulnerability, and which had caused her to execute these documents. She became concerned that the adult's estate may diminish as a result, and prepared a statement outlining her concerns, and which she sent to the Public Guardian.
25. That was received by the Public Guardian on 21 October 2009.
26. On 22 October 2009. the Public Guardian received from the offices of D the notice purporting to revoke the P of A in favour of C, and the replacement continuing and welfare P of A in favour of E. Both of these deeds, dated 30 September 2009, met the statutory requirements for registration by the Public Guardian.
27. The Public Guardian does not have the power to determine the matters now at issue, nor call for any reports which might have a bearing on the capacity of the granter to have executed the documents dated 30 September 2009.
28. The Public Guardian took the view however that the content of the statement provided by C was of sufficient concern that she should refer the matter to the court for a decision, and in the meantime asked the court for directions on whether she should proceed to register the purported Revocation and the new P of A.
29. The present petition at the instance of the Public Guardian was received at this court on 30 October 2009, and on 4 November 2009, having considered the material which accompanied it, I pronounced an interlocutor directing the Public Guardian to :-

1)     refrain from discharging her obligation under Section 22A(3) of the [Act] to enter in the Register maintained by her the particulars of a notice dated 30^th September 2009 purporting to revoke a Power of Attorney granted by the Adult in favour of [C], dated 20^th February 2007, and

2)     refrain from discharging her obligation under Section 19(2) of the [Act] to enter in the Register maintained by her the particulars of a document dated 30^th September 2009 purporting to confer a Power of Attorney granted by the adult in favour of [E], pending further orders of court.

30. Intimation was ordered on relevant parties, including C, D and E, and since it was an obvious case for independent input on behalf of the adult, including psychiatric examination, I appointed a safeguarder in the form of Mr Ronnie Franks, an extremely experienced practitioner in the field of mental health law.
31. Amongst the concerns raised by C and communicated to the Public Guardian were the nature of certain financial transactions by A which C had come to learn about. C had first become aware of E in about 2004, when A told her that she had met this person at a bus stop and on the odd occasion thereafter. That account was different from the account A gave to D in 2009. C reported that at the end of 2007, she had been "summoned" to A's house one night at about 9 p.m. and at that meeting A told C that she, A, had given E £4000 from her savings. A had been upset when telling this story to C, and said that she had given E the money because E had been complaining of financial hardship, such that mortgage payments could not be maintained. It was unclear if this was a gift or a loan.
32. As a result, C became more financially active on A's behalf then, notifying relevant financial institutions that she, C, was the attorney of A. At about this time, A had started to suffer falls at home and had been hospitalised. C began to deal with regular payments of bills on her behalf, and would accompany her to her bank to allow her to make cash withdrawals. She then returned A's bank passbook to her when she appeared to be better, but later in 2008 had access to it again and discovered that A had been withdrawing £200 per week regularly from her account, yet there was no cash in her house. It transpired that E had then been accompanying A to the bank and the shops, and assisting her to make these withdrawals. C contacted E and asked for an accounting, but has never been given one. C tried to persuade A not to continue in this practice, but A seemed to resent C "interfering" in this way and C formed the impression that this money was being "paid" to E as the "going rate" for their friendship. Later in 2008, the amount regularly withdrawn by A increased to £250.
33. Also in that year, C learned that E had represented herself as A's next of kin on one of A's stays in hospital, with at least one nurse being under the impression that E was A's daughter. She is not. She is not related to A in any way. There then arose, in April 2009, an issue with C learning that A had been attempting to cash in some of her Savings Bonds, which may have had serious implications for A's finances if the money had not been re-invested.
34. Of course, if A has full capacity, she may dispose of her assets as she wishes to, but from the material just set out, it can easily be seen that C was entitled to be concerned that A's failing health and vulnerability meant that it was possible that she was being unduly influenced by E. All of these matters were reported to the Public Guardian by C.

The Appointment of the Safeguarder

35. Bearing in mind that the documents under question were signed on 30 September 2009, the Safeguarder instructed an independent psychiatric examination of A in order to see whether she would be assessed as having had the capacity to give such instructions at that time. Dr Derek Brown, who is an experienced Consultant Psychiatrist and is approved under the relevant legislation, examined A in December 2009 and January 2010.
36. He pointed to a significant medical history of hospital admissions since 2006, 6 in total, the last of which was an inpatient stay from 24 July to 19 August 2009, just 2 weeks or so before instructions were ostensibly given by the adult to draw up the documents under question, and which included a Mini Mental State Examination (MMSE) with a recorded score of 18 out of 30 (less than 24 demonstrates the existence of dementia). Although A was able to give Dr Brown substantial information about her early life, she once again scored only 18 in the MMSE, and Dr Brown concluded that she had moderate dementia, caused by a series of cerebral infarcts, with significant cognitive deficits, particularly of attention and executive functioning/abstract reasoning. He concluded that A did not have the capacity to have granted the P of A she did grant on 30 September 2009, nor would she have capable of understanding the consequences of revoking the previous one.
37. His opinion was that as at 30 September 2009, A lacked the capacity to grant a P of A in favour of E, and specifically that she did not have the capacity to recall that she had done that, or understand that E would have (full) powers over her financial affairs, or that such power would continue in the event of losing capacity. Further , it was his opinion that as at the same date, A lacked capacity to revoke the previous P of A in favour of C, and specifically that A would not have had the capacity to recall that she was revoking these powers, or understand the consequences of that revocation, or that C would no longer have any authority to make financial decisions for her.
38. For the avoidance of doubt, Dr Brown was of the opinion that A's lack of capacity in respect of these matters persisted, and that she would in fact not have had capacity to grant even the original document in February 2007. As I have pointed out already, I am not asked in this process to make any finding or direction in relation to that document, which would persist in effect if the Public Guardian is instructed not to register the revocation of it, or of the document purportedly replacing it.
39. In light of the very full enquiries undertaken by the Safeguarder, and including his acceptance of the Opinion of the independent Psychiatrist, the Safeguarder supported the making permanent of the interim orders.

The Issues raised at the Hearing

40. At no time did E enter the process. She was not present or represented at the Hearing on evidence. As a result, it was not open to me to make any judgement on the issue raised by C as to whether E had exercised any undue influence over A with regard to any financial transactions which may have taken place. I am told by C that they did, and that they occurred at a time when A's capacity to rationalise her financial dealings was questionable.
41. No medical evidence contrary to that of Dr Brown was led. That means that if I accept his evidence, it is a short step to holding that A's capacity to order her affairs was sufficiently reduced as at the critical date of 30 September 2009 to mean that she may well not have had the capacity to understand the significance of the documents she signed on that date, and that as a result, they ought not to be registered by the Public Guardian. As already pointed out, without registration, they have no legal effect.
42. Once it had been represented to me that D was maintaining that proper procedure had been followed with regard to the taking of instructions from A to draft these documents, and that A had appeared to have capacity to give those instructions, it seemed that a hearing of evidence was going to be required. Solicitors are specifically authorised by statute to make the declaration I have already referred to, and no formal procedure is set down to prescribe in what manner they have to be satisfied of a client's capacity before taking instructions. There is, after all, a presumption in favour of capacity.
43. I should also make it clear that I was not presented with evidence as to the general factors which ought to guide the practitioner who has to decide if a client has capacity to understand the significance of documents which that client ostensibly instructs. I do not know the content of any Guidelines issued, for example, by the Law Society, on the matter, and as a result, it is simply not possible for me to suggest any particular steps which the prudent practitioner ought to adopt as a matter of course in every case. Since I heard no such general evidence, I cannot lay down any guidelines. I am aware that it is the practice of the Safeguarder in his firm to ask for a medical report, at least from a General Practitioner, before a solicitor is prepared to sign the sort of statutory declaration required in a P of A, and in response to the suggestion that that may be unnecessary in the vast majority of cases, at least a policy of insisting on it with every client means that if any particular individual or group of persons is offended at the request, it can be pointed out that everyone is similarly requested.
44. I can comment therefore only on the question whether in the particular circumstances of this case, the steps carried out by D appeared to be satisfactory with regard to satisfying that practitioner of A's capacity. I regret to say that I cannot hold that they were. I do not doubt D's sincerity or integrity, and nor did any party to the Hearing, but unhappily, I have come to the conclusion that insufficient attention was paid to the basic question of whether A had the capacity to grant the deeds in question.
45. D gave evidence and explained that the introduction to A had come through E, whose brother had been a client of D some time before. The basis of the introduction was that E, who was not a client of D, came to D and said that she had a friend who wanted to change her solicitor. One might be forgiven for thinking immediately that alarm bells should ring when it is discovered that the prospective client is an 87 year old person with significant health difficulties, and the first question in everyone's mind would be, "change her solicitor for what reason ?". These instructions were passed on at the beginning of September 2009, only 2 weeks after A had spent a prolonged spell as an inpatient, yet D gave no indication of being aware of that. D went to A's home, and in the presence of E, a non client of D and non relative of A, spoke to A. The instructions were "to change her solicitor", and again one was forced to ask, "why ?"
46. D said that A handed over an envelope with a will and a P of A in it. This was the P of A in favour of C dated 20 February 2007. A said that she wanted to change her will, so as to leave everything to two relatives, and to exclude C from it. D did not discuss what assets A had which formed her estate, nor even if she owned her house, which in fact she does. D accepted that she engaged in very little dialogue, if any at all, as to the effect of these instructions. There was very little detail as to what was required. D said that A simply insisted that that was what she wanted. D said to A that she would give her 3 weeks to think about it and in the meanwhile do nothing, but in fact, D did prepare a revocation of the previous P of A and a new will, which D produced when revisiting A 3 weeks later, on 30 September.
47. D said that A was adamant that she did not want C to have anything to do with her money, and when pressed by me if inquiry had been made as to why A had formed this view, (remembering that E was present throughout this interview), D answered that C had lost some of her money and A was angry about it. A said it was £3600. It seemed clear that A was accusing C of misappropriating some of her money, and whether that was said to be deliberate or as a result of negligence, it is a serious allegation, for which, let it be said, there is no foundation whatsoever. However, D did nothing to inquire as to the background of this claim to see if it was genuine, and despite knowing that C was (a) an attorney acting under a registered Power, and (b) a practising solicitor, D took no further action with this information provided by A, whether it was accurate or not.
48. D did return to see A 3 weeks later, on 30 September 2009, and once again E was present. A did sign the deeds, with D witnessing them and completing the required statutory declaration. It will again be seen that D's knowledge of the client against which that declaration was completed was extremely limited. D seems to have made no inquiry whatever about any relevant medical history or background of A, albeit E was present and knew as a certain fact that A had been discharged from hospital very recently. D said that the terms of the P of A were explained to A "as best as [D] could", which is not exactly comforting. A was insistent that that was what she wanted, as long as she got access to her bank account, but it was not clear to me that A was made to understand that her new attorney would have that power. D had previously experience on only one occasion of drafting a P of A.
49. When these present proceedings were begun, D visited A again and said that the case would have to go to the Sheriff Court and that A was furious to hear that. She said that she had known what she had done and was very annoyed at C "interfering" in her affairs. Worryingly, D then said that when A was being told about the possible continuation of the previous P of A, A had said that she had not signed any papers. This was something which was later to feature in Dr Brown's evidence.
50. D was clear that there was no cause to question A's capacity in September 2009, albeit there was by January 2010, by which time of course D knew much more of A's history than in September.
51. Dr Brown also gave evidence, and without having to go into it in any detail, he spoke to the terms of his previous report and gave cogent evidence in support of his view that as at September 2009, A would not have had the capacity to understand the significance of revoking a previous document and granting a new one. Dr Brown is very experienced in this area, and is well familiar with the statutory tests for incapacity prescribed in the Act.
52. Of particular note to him was the recent medical history. In October 2006, a MMSE carried out in hospital resulted in a score of 18 out of 30. She was noted then to have no insight into her poor recall. In February 2009, again in hospital, she was noted to be confused as to her whereabouts. She was admitted again in April 2009 with collapse and confusion, and remained there for 17 days. A CT scan showed signs of atrophy and established infarcts in the basal ganglia and left occipital lobe. An MMSE showed a score of 5, but Dr Brown thought this was more likely to have been an AMT test, (an older form of test, now replaced) which scores out of 10. Finally, during the admission from 24 July to 19 August 2009, just 2 weeks before she gave the instructions which have led to this case, and where the admission was for another collapse, another MMSE scored 18 out of 30.
53. When he saw her, which he did twice in December 2009 and January 2010, he noted no degree of consistency in her complaints. She did say to him that C had taken money out of her accounts and she did not know where it was, but also told him that she believed that C wanted to sell her house and to "keep hold of her". She had a clear lack of understanding of a P of A and only sketchy knowledge of the powers it gave. She told him she wanted E to be able to take money out of her account and give it to her, but despite having handed D the envelope with the original P of A in it, she told Dr Brown that she had no memory of signing any form in favour of C or of giving C welfare powers. This is highly significant, because it means that she had no real understanding of why a revocation was even necessary. He said a score of 18 out of 30 shows significant impairment.
54. In fact, he said that the notes showed that in April 2009, based on the CT scan done then, a diagnosis of vascular dementia had been made then.
55. She fared poorly in his tests, and he concluded that she had no capacity to understand the two documents she had signed on 30 September, and by denying ever signing such documents before that, was incapable of retaining the memory of decisions she had clearly made. Both of these findings support a definition of incapacity contained in section 1(6)(d) and (e) of the Act. She did not want C to manage her affairs, but her reason for that fluctuated and was affected by her inability to remember that she had given C powers to do that, in 2007.
56. He was quite clear, and I accept this opinion, that capacity is decision specific, and that a person may appear lucid, and be capable of performing some functions satisfactorily, but may still be incapable of performing others. He also said that if persuasion was applied the right way, A would be open to persuasion and would find it more difficult to resist.

Facts Established in Evidence

57. As I have said, there was no contrary medical evidence to that of Dr Brown, and since he justified the opinion he had formed by cogent evidence, I have no hesitation in accepting it. That means that I accept that A did not have the capacity in September 2009 to give the instructions she did to revoke the previous P of A and grant a new one. I do not believe she had any proper understanding of either document or what it authorised, and I am particularly concerned that she was unable to remember having granted it at all in favour of C in 2007. A person has to know what he or she is revoking, and I could not be satisfied that A did know.
58. Further, while I do not dispute D's good faith in accepting instructions and preparing these documents for signing, I do not believe that sufficient inquiry was made of A by D to satisfy D that A had capacity to instruct these documents. This was a new client, and D had no previous knowledge of her, she was 87 and had been in poor health with many recent hospital admissions, but D made no inquiry about that. A's reasons for wanting to change her solicitor were never made really clear, and nor was any action taken about a suggestion of impropriety on C's part, which was never investigated and in any event is entirely without foundation, which itself may point to irrationality. Further, A had been accompanied by E throughout the interviews, which may not have been appropriate.
59. As the Safeguarder put it, all of this pointed to the need for caution, and while D maintained that all A had wanted was to let E have access to her accounts, with no other detail, it was precisely that lack of detail which ought to persuade the practitioner to make much greater inquiry of such a client prior to accepting instructions and before being prepared to sign the statutory declaration required.
60. I agree with those observations.
61. Having come to the conclusion that the adult, A, lacked capacity at the time of signing the two documents in question, my responsibility is clear. I must now make permanent the interim directions I have already given to the Public Guardian to refrain from carrying out her statutory duty to register these two documents dated 30 September 2009. The effect of that is that they have no effect as unregistered, and the previous power of Attorney in favour of C and dated 20 February 2007 remains registered and in force.
62. While it may be suggested that that leaves C as attorney for an adult whose wish it is that C have nothing to do with her affairs, that wish expressed by the adult, which I must take into account, appears to be based on a false premiss, and on a lack of memory that she had already appointed C to do just that.

Expenses

63. There was a submission made that if the Public Guardian was to be made to pay the expenses of every party represented, it might inhibit the bringing of such applications in the future. That would be unfortunate, but I do not believe the Public Guardian would be deflected from her duty in bringing appropriate cases to the attention of the Court. As I have said, this is the first such application. In the event, I will order that the Public Guardian pay the expenses of the Safeguarder, who would otherwise not be paid at all, but otherwise I believe that all other parties represented should bear their own expenses.