Scottish Sheriff Court Decisions

AW310/12

Opinion of

John A Baird, Esq., Advocate

Sheriff of Glasgow and Strathkelvin at Glasgow

In the case of

Applications by the Guardian of P

Family Background

1. This case involves the circumstances of three sisters, who according to all of the information I have been given and understand, were devoted to each other and to each other's welfare and wellbeing throughout their lives. They worked hard and acquired some property through prudent saving and investment. All three remained unmarried and had no issue. They lived separately but close to each other and all three owned their own homes. They were all particularly religious people; they exemplified the teachings of their religion, not just by attending worship faithfully, but by the care and concern they showed to each other and for others. In particular, they recognised the need for financial support of charitable causes and of the religious orders and organisations which provide charity and help, and also for the need for financial support of those who minister to others as members of such charitable organisations and as ministers of religion, and who in most cases do so with very little in the way of financial means.
2. Late in life, one of the sisters (P), the adult in this case, married, her husband having an extended existing family, albeit no children. Her husband was a member of a well known and respected family, not just in the west of Scotland, and on his untimely death, she acquired further property by inheritance. One of her own sisters had died also, and after her husband's death, as I understand it, she returned to live back in Glasgow and acquired a house close to that of her remaining sister (N), to whom she remained devoted. That sister, although owning heritable property, was less well off than P, and it is clear to me that P knew that and was determined to ensure that N would be as well provided for financially as she, P, could manage. The expression "love favour and affection" is a familiar one in conveyancing and executry work in connection with arrangements made by family members to assist other family members, and seldom has it had more actual meaning than the circumstances demonstrated in this case.

Background to the Present Application

3. Sadly, P developed dementia and on 23 November 2011, I appointed the applicant to be the guardian to the adult, her aunt, then aged 74 (now 75). I was satisfied then that the adult is an adult with incapacity as defined in the Adults with Incapacity (Scotland) Act 2000, that the principles of the Act were complied with, and that the applicant was suitable for appointment as guardian. Had I known the full detail that I do now, I may not have been persuaded that the appointee was suitable, having regard to the potential for conflict of interest. The order was granted for a period of 5 years and included powers relating both to the welfare and property and financial affairs of the adult. The adult was at that time, and still is, residing in a care home, and the original application sought power to sell the house in which the adult had latterly lived.
4. On 7 and 10 September 2012, the applicant presented to the court two separate applications in appropriate form, one of which was to vary the previous order by authorising the applicant to sell or otherwise deal with two additional heritable properties which it had been discovered were also owned by the adult, and the other of which sought permission to revoke a specific bequest which was contained in the adult's will.

Giving Authority to Alter, Amend, or Draft a Will

5. I have previously stated that I consider that under the provisions of the Act, the court is empowered, in appropriate circumstances, to authorise the making of amendments or additions to the will of an adult who is still living but has lost the capacity to effect such changes herself. I have also previously stated that I believe that the court is empowered to authorise the making of a will on behalf of an adult, where the taking of such a step would appear to be prudent and justified. Of course, if deciding to do so, the court must be bound by the guiding principles of the Act, but in all such cases, I have made it abundantly clear that I would be prepared to do so only if presented with clear, incontrovertible, and unequivocal evidence of the wishes and intentions of the testator (the adult), and that to do so would result in benefit as prescribed in the Act.
6. To that end, it is not appropriate to indicate the circumstances where it may be appropriate to authorise the taking of such steps, but might be helpful to indicate where it may be thought not appropriate to do so.
7. As an example of the latter, earlier this year I was presented with an application to execute a will on behalf of an elderly gentleman who was now an adult with incapacity. He was unmarried and had no issue, but a number of relatives through his brother. He had never made a will. The proposal was to do so now on his behalf, and to provide for a distribution of his property on his death which would be exactly in the same manner, and in the same proportions, as it would devolve on intestacy. What, I asked at the time, could be said to be the benefit to the adult of doing that ? The only answer was that it would provide for an executor-nominate.
8. Interestingly, the application also sought to include a clause donating the remains of the testator on death to medical science, it being represented that that had been known to have been a wish regularly expressed by the adult. After the application was lodged, it was realised by the applicant's solicitors that authorisation to allow for a will containing such a bequest is not in fact competent, as a guardian appointed under the Act may not make such a request on behalf of the adult (S64(2)(c)), and in any event, to emphasise the point I have repeatedly made about clear and incontrovertible evidence of the wishes of the testator, it later transpired that the adult may well have said that not out of a deep seated desire to assist medical science but out of an understandable (but perhaps less noble) desire to save the expense of a funeral.
9. In fact, that application was then withdrawn, but only after I had indicated that if the avoidance of the need to present a petition for the appointment of an executor-dative was the only benefit to the adult which would accrue, such intervention may well not amount to the least restrictive option in relation to the freedom of the adult consistent with the purpose of the intervention (S1(3)).

The Need for Further Powers in the Present Case

10. It is not entirely clear to me why the full extent of P's assets was not known at the time of the original application, for reasons which will perhaps become clear, but in any event, it had been discovered that she had an interest in a timeshare in a property situated abroad, and that she also owned a one half share of the house which was being lived in by her sister N. As I say, I do not really know why that was not taken into account originally, as it appears to have been well known by the family, but in any event, the fact that the adult P owned her sister N's home jointly with N is completely indicative of the extent to which P had always been prepared to look out for, and after, N. It may be that N may not have had the resources to fund the purchase completely out of her own funds, and P had assisted in enabling that.

The First of the New Applications

11. This seeks to vary the powers granted in the original order by adding reference to the adult's half share in the house owned by her sister N and allowing the guardian to manage that, including by sale. It also seeks to vary the original powers in order to allow disposal of the adult's interest in her timeshare property abroad. It has transpired that, unhappily, N has also now succumbed to the effects of dementia, and she too is now resident in a care home. She will not be able to return to her home and it will require to be sold, so for obvious reasons, P's guardian needs to have the power to sell her one half share of it.
12. If that was all there was to it, there would be no difficulty. It is not. The applicant in the present applications is P's guardian, appointed by me. She is also the niece of N. I have been advised that the applicant also holds a Power of Attorney for N, that having been properly granted and registered before N lost capacity further to order her affairs. Further, the applicant is named as executor-nominate in the will of her aunt P, the adult, and as the executor-nominate in the will of her aunt N, in the event of the first named such executors in N's will having pre-deceased or become unable to act, which has in fact happened (the first named executors were her two sisters, one of whom has pre-deceased and the other of whom is P, who of course no longer has the capacity to act). The applicant is also a named and prospective beneficiary of the estates of both P and N.

The Second of the New Applications

13. But that is not all, because the purpose of the second application is to create a discretionary trust of which the present applicant will be one of the two trustees, the other being the applicant's sister, who is also a prospective beneficiary. The applicant therefore comes before the court wearing no fewer than 7 different hats or at least prospectively so, and it is obvious, at least to me, that there is the potential for conflict of interest.
14. In the second application, she asks the court to allow her, qua guardian of P, to prepare and execute a codicil to the will of P which will revoke a specific bequest contained in that will.
15. As I say repeatedly, I am prepared to do that only on clear and incontrovertible evidence as to the intentions and wishes of the testator. What is of the highest significance in this case is that I have evidence of the clear and incontrovertible intention of the testator. P instructed and signed a will as recently as 6 March 2009, at which time she was 71 years old. That will is very specific in its terms. She makes bequests of specified sums of money to nine different family members. She then makes a further bequest of a larger sum to one family member, who is a member of a religious order, with the residue of that bequest going to the order itself. There then follows clause 9 in which she bequeaths the sum of £50,000 and also her one half share in N's house to her sister N. The will goes on to bequeath her interest in the said timeshare to the present applicant, and divides the residue amongst all of her other nephews and nieces, with a specific provision for a further bequest of 30% of the residue to go to the present applicant.
16. This application asks me to revoke the clause which leaves the sum of £50,000 and the half share of N's house to N. In fact, the title to N's house is in the names of all 3 sisters with a survivorship clause, so that in the event of P's death, the whole right and title to the property would vest in N anyway, but of course P is not dead. The value of P's half share is put at £80,000. What I am asked to do, therefore, is to revoke a provision made as recently as March 2009 in which P sought to make a substantial provision in favour of N, to the extent of the equivalent of approximately £130,000. Even the applicant accepted explicitly that P made that provision so that her sister N would be well able to look after herself in the event of P's death. It is completely clear that in doing so, P followed the pattern of devotion to her sister and her welfare on which I have already commented.
17. So why am I asked to allow that prospective bequest to be revoked ? The answer is; to suit the interests of the applicant and all the other nephews and nieces.
18. I now mention the specific averments made in order to support this proposal, together with further comments made at the hearing.
19. The application was accompanied by a report (AWI[10]) from a solicitor, not of the firm who act for the applicant. That solicitor, in commenting on how the proposed order will benefit the adult ( N.B. - the question is how it will benefit the adult) says, "The adult will benefit as it is believed that if the adult had not been incapable of managing her own affairs that she would have wished to have the steps taken proposed to preserve the assets of the family and to pass on to her beneficiaries without risk of the funds being dissipated". It then goes on to say, "Unless the order is made the status quo shall prevail and if the adult passes away the subjects will pass to [N] and may be dissipated in care costs". I note with considerable concern the use, twice, of the word "dissipated" in connection with the need to pay care costs for N.
20. In the application itself, it narrates that as N is now herself in care, with an ongoing obligation to pay care costs, the adult P, if still capable, would in those circumstances have been appropriately advised not to make the bequest to N which she did make, as recently as 2009, and that if P dies and N inherits as P intended, these assets will be taken into account for the purposes of a financial assessment of N's means to afford to pay for care. N was born in 1927 and is now 85, 10 years older than P. The writ goes on to say "The result is that the legacy and bequest will be effectively immediately lost and will not benefit the family due to the impact of the financial assessment".
21. That averment is pretty breathtaking. The test for me to satisfy is benefit; the only benefit being talked about there is benefit to the family, and pays no heed to the stated intent of P, as recently as 2009, or to the benefit which N would derive if she inherited such assets. They would pay for her care. It seems tolerably clear to me that at the time when P made that will, she must have had in contemplation the possibility that neither she nor her sister would be able to continue to live independently. These are intelligent and respectable individuals. "Benefit" need not be tangible; assuring peace of mind can constitute benefit. When P made that prospective provision in 2009, is it not clear that she intended thereby to assist her sister N in the remainder of her life so that she could live in comfort and dignity ? Is it conceivable that P would readily consent to revoking that bequest, just because N is now in a care home ? They were both intimately aware of each other's circumstances. The effect of this proposal may be that N's assets do not cover the fees, and that she may require to be moved, at that age, to less salubrious surroundings, with all of the upheaval involved, and with the burden of payment falling on the state. Where is the benefit to the adult P from achieving that outcome ? And is that really what she would wish ?
22. In the course of the hearing, the applicant expressed the view that she, and I do not know if the other prospective beneficiaries shared this view (but would be surprised if they did), did not want to see the money which P left to N, assuming P's death, to be "frittered away" in care costs.
23. Let me make this point very clearly; I do not regard the expenditure of necessary sums in the payment of care costs to make the remaining life of an elderly and worthy lady one which is as comfortable and dignified as possible to be "dissipation", "loss" or "frittering away" of assets; quite the contrary. It would be a proper use of her resources, and one which I have to assume would have been in the contemplation of the adult when she made that prospective provision.
24. When I asked the applicant at the hearing what evidence there was for the belief that P would have revoked a bequest made only 3 years earlier if she had known that N would require to live in care, I was told that both sisters held to the view that the "state should pay for everything" and that they were brought up in the philosophy of the Health Service looking after us "from cradle to grave". I was given no written material from which I could discern if the adult had ever said that or not, but as I have pointed out, these ladies are of such an age that they spent many years of their lives before that philosophy emerged, and have lived to an age when they well knew that it no longer applies.
25. I was told that the intention was to put the value of the bequest into a form of discretionary trust, managed by the present applicant and her own sister. It would therefore not form part of N's assets. Although there was the merest hint that the trustees might approve the use of some of the money for the benefit of N, it is completely clear that the whole purpose of this is to remove that substantial sum from the available assets of N, in order to preserve it for the benefit of all of the remaining beneficiaries, who of course include both the applicant and her sister, the proposed trustees.
26. I can say that in terms because the writ itself declares that the granting of the application will have key benefits including "to more effectively implement the understood testamentary wishes of the adult as well as the understood testamentary wishes of [N]" and that "due to the personal financial circumstances of [N], to avoid the effect of the adult's testamentary writings reducing the value of assets from which the adult's family can ultimately benefit". That is all quite blatant. I may also add that the adult's testamentary writings are completely clear; there is no ambiguity. Further, no evidence was presented regarding the "understood testamentary wishes of [N]". They are clear also. She wrote her will in 1976 and had over 35 years after that in which to say something different if she had wished to.
27. So, who is it who is saying that the adult would have wanted to cut her sister out of her will ? It is the applicant. That brings me to certain other averments and documents which are condescended upon. Article 6 of the writ says this: "The adult and [N] have entered into a Minute of Agreement in relationship to the survivorship destination so as to renounce their respective interests in the destination, dated 16 May 2012 and registered for preservation ... in the Books of Council and Session on 21 May 2012, a copy of which is produced herewith and referred to for its full terms".
28. That is a remarkable averment. Neither the adult nor her sister N did any such thing. That document is produced. It is a purported agreement between the adult and her sister, but neither of them had anything to do with the reaching of any such agreement. Neither of them has the remotest idea of the proposition contained in this application, or is aware of the content of that document. I have seen it. It is in fact a document entered into between the applicant, qua guardian of the adult P, and herself, qua attorney of N. It represents in effect that the applicant has agreed with herself that the agreement is in the interests of P and N. It also, in clause (A), states that "[P] and [N] have now agreed that they wish to document their agreement as to the result of the taking effect of the destination contained in the Disposition" (i.e. the survivorship clause in the tile to N's house) and goes on to say that P and N immediately renounce any interest or entitlement they may have in the event of the survivorship destination taking effect. The document is then signed twice, both signatures being that of the present applicant. She signed it in her own name qua guardian of P and in her own name again qua attorney of N. Once again, while it may be that the applicant has the power to enter such arrangements on behalf of either, or indeed both, parties to it, it is simply not correct to say that each individual sister has actually agreed to anything.
29. In any event, other than it being represented that this is an exercise in good estate planning, I have been presented with no evidence as to the wishes of N, and no satisfactory evidence as to the wishes of P.
30. It is of course correct that the bequest under consideration is only prospective; it has not vested. Both parties are still alive. But I am being asked to revoke it in the circumstances set out upon the basis that the adult would have been given advice to do so on account of the change in the circumstances of her sister N. It is also said that the granting of the order would assist in implementing and achieving the ultimate wishes of both the adult and N by providing and protecting their estates for their nieces and nephews.

The Potential Conflict of Interest on the Part of the Applicant

31. I cannot let this pass without referring again to the multiplicity of positions and prospective positions held by the applicant, who is herself a professional person of standing in the community. I specifically raised the question of conflict of interest and was told that she had been advised throughout by her present solicitors, who present this application, and that she had not sought, or apparently been advised to seek, separate advice from any other firm, having regard to the many different interests which she represents. It is for others to judge whether there is such a conflict as would have necessitated the taking of separate advice.

The Decision

32. There is no difficulty in approving the addition of the powers to deal with the two additional pieces of heritable property now known to be owned by the adult. That application, the first one, will be granted.
33. As to the second application, seeking the power to add a codicil which has the effect of revoking a specific legacy made by the adult as recently as 2009, I have no hesitation in refusing that application. I have not come anywhere close to being persuaded that the wishes of the adult P, expressed clearly and as recently as 2009, no longer have effect. They are expressed clearly, unambiguously and incontrovertibly. I do not for one minute accept that this adult would have chosen to disinherit her sister, leading to the kind of situation which may well follow from that. The second application wholly fails to persuade me that the tests I have to apply as set out in the core principles of the Act would be satisfied by the granting of this application. It may be that the advice tendered by the solicitors in this case is proper, and would represent proper estate planning. I do not accept that this adult would benefit from the proposed step, and in fact I find that the decision of the applicant to proceed with this application, even if the advice was correct, is deeply disappointing.

Expenses

34. For the reasons set out, I am prepared to award the expenses in connection with the making of the first application, to add the additional powers to sell the two other heritable properties, out of the adult's estate, but am not prepared to allow that with regard to the second application to add the codicil. The applicant must bear the expenses of the making of that application from her own resources.