In Ritchie v Nelson [2016] CSOH 35, decided on 4th March 2016, Lord Clarke granted decree of reduction of a Disposition in favour of the defender by an aunt of the pursuer (now deceased – “the deceased”) of a house belonging to the deceased, on the grounds that the deceased “did not have the necessary capacity to grant the Disposition” [paragraph 88 of Lord Clarke’s decision]. The pursuer, who was executrix-dative to the deceased, also pled facility and circumvention though “that case was, in the event, perhaps, less well developed” [2] and not accepted by Lord Clarke.

The case is of general interest as to the question which medical witnesses should address when giving an opinion as to capacity in such a case; the use of an affidavit where there was no apparent reason why the evidence of the person in question could not have been taken on commission; and Lord Clark’s comments on the case based upon facility and circumvention. Also worthy of comment are two aspects not addressed, namely aspects relating to a power of attorney granted by the deceased, and circumstances surrounding the granting of the Disposition which might have warranted at least the possibility of a case based on undue influence.

For the purposes of this article, relevant persons were, in addition to the pursuer, the defender and the deceased; two medical witnesses called by the pursuer and one medical witness called by the defender; the family solicitor, now deceased, who prepared the Disposition (“the family solicitor”); and the witness who purportedly witnessed the Disposition (“the witness”). “the Disposition” is the Disposition which the pursuer sought to have reduced, and “the subjects” are the subjects purportedly conveyed by the Disposition.

Lord Clarke held that: “The primary issue for the court to determine in this action is whether or not, on the balance of probabilities the deceased, as at the date of the disposition, 2 July 2007, had the necessary legal capacity to grant that deed, the effect of which was to dispone, inter vivos, the only asset of hers of any significant value namely her home.” [74]. It was accepted that as at October 2007 the deceased was suffering from advanced dementia, therefore: “The question therefore becomes more refined and it is whether, notwithstanding the accepted fact that the deceased was suffering from advanced dementia in October 2007, she, nevertheless, had the mental capacity, sufficient on 2 July 2007, for her to be considered as having been capable of fully comprehending the nature and effect of the granting by her of the disposition in question.” [74].

Relevant dates include that in 1966 the subjects were acquired by the deceased and two siblings with special destination to the survivors and the survivor; those siblings died in 1992 and 1999 respectively; the deceased granted a power of attorney in favour of the defender on 30th September 2004; the Disposition was granted on 2nd July 2007; the deceased died aged 96 on 31st March 2011; and the pursuer was confirmed as executrix-dative to the deceased conform to an interlocutor dated 20th March 2012.

The medical evidence

Both of the pursuer’s medical witnesses, whom Lord Clarke found to be credible and reliable, had submitted written reports providing opinions, “in no material respect … displaced in cross-examination”, that on the balance of probabilities, the deceased would not have had sufficient capacity on 2nd July 2007.

Lord Clarke quoted, with evident approval, the conclusion in the report by one of the pursuer’s medical witnesses, which was in the following terms: “In summary following my review of the available evidence I believe it to be, on the balance of probability, highly unlikely that in July 2007 [the deceased] possessed the capacity to understand and/or recall complex financial decisions such as would be required to sign a deed transferring ownership of her house to her nephew.” [28].

Lord Clarke was however critical of the approach of the defender’s medical witness. He said: “It was apparent from the witness’s report [i.e. the report of the defender’s medical witness] and his evidence that he approached the request for an opinion from a standpoint he adopted when, for example, advising on guardianship cases. His starting point was, he said, always, in such situations, that there was a presumption that the individual who was being considered for guardianship had capacity, the task then being to identify whether or not there were any contra-indications. I observe at this stage that the court, however, in a contested litigation like the present has to decide the issue of capacity on the balance of probabilities. [The defender’s medical witness] did not, it seems to me, address the issue in that way. His position was simply to say that he could not say what mental capacity, if any, the deceased had before she entered hospital.” [57].

Lord Clarke also commented, after indicating that he found the evidence of the pursuer’s medical witnesses persuasive, that he had “some difficulty” with the evidence of the defender’s medical witness who “was, no doubt, doing his best to assist the court but, as has been noted, he approached matters on the basis that the pursuer had to overcome some presumption and was, as a consequence, desiderating a level and kind of evidence which he considered was necessary to rebut that presumption.” [75].

The affidavit evidence

As already indicated, Lord Clarke was critical that the defender had submitted an affidavit by the family solicitor when it appears that the family solicitor’s evidence could and should have been taken on commission. Lord Clarke was “unable to place any weight on the material contained in the affidavit for ultimately deciding the key issues in [dispute in] this case. The affidavit raises many questions which the court would have wished to have answered by [the family solicitor]. Fairness also would have required the opportunity to be given to the pursuer to have [the family solicitor] cross examined in relation to what was said in the affidavit as it clearly was highly germane to the issue in the case. No explanation, at all, has been given as to why his evidence was not taken on commission when it appears that he was alive for some time after the proceedings were raised.”

Facility and circumvention

Lord Clarke considered that the pursuer’s case on grounds of facility and circumvention was lacking in specification. On the evidence, facility at the material time was made out, but the pursuer had not “set out averments sufficiently specific in the circumstances to support the existence of circumvention, or that, in the event she has placed before the court sufficient evidence to support circumvention on the part of the defender  or  anyone  else  in  this  case.”     He  was  “not  satisfied  that  they  amount  to  establishing circumvention which is said to be a ‘deceit or fraud’. There must be clear averment by which person or persons the deed is alleged to have been impetrated.”  He referred to Baird v Harvey’s Trustees (1869) 20 D 1220, which in turn referred to Clunie v Stirling (1854) 17 D pages 17 and 18. He also noted that:  “There is a question as to whether the deceased could be said to have at least, strictly speaking, suffered lesion. In McKay v Campbell 1966 SCT 37 at 249 it was held that it must be averred that the party suffered lesion by granting the deed complained of. In my judgment the pursuer failed adequately to address this aspect of such a case.” [89].

The power of attorney

Lord Clarke narrated that one of the pursuer’s medical witnesses had, in her report, noted that there are “obviously concerns as to when this Power of Attorney was granted, as I think it is likely that [the deceased] would have been unable to give consent in the last year or so.” [22]. Later in his Judgment he narrated and commented that: “On 30 September 2004 the deceased granted a power of attorney, 6/6 of process, which was registered with the Office of the Public Guardian. That might suggest, it was submitted, that at that time there was at least some concern as to the deceased’s wellbeing and capacity to look after her own affairs.” [64].

The family solicitor “stated that he had acted on behalf of the deceased in drawing up a continuing power of attorney in terms of which she appointed the defender and his brother Francis as her continuing attorneys in terms of section 15 of the Adults with Incapacity (Scotland) Act 2000. He had acted as a witness to the power of attorney which was executed on 30 September 2004.” [15].

It is surprising that apparently no evidence was given to the court, and no submissions made to the court, as to the certification of the power of attorney, including as to who certified, whether indeed capacity and absence of undue influence or other vitiating factors was certified, and whether (and if so whom) the certifier had consulted for the purposes of certifying capacity.

Undue influence?

Towards the end of his Judgment, Lord Clarke commented that: “The whole circumstances surrounding its instruction and signing were driven, it seems, by the defender.” [86]. The evidence indicated that there was no record in the family solicitor’s  file of any meeting between the family solicitor and the  deceased regarding the Disposition. There were no file notes of instructions being taken from the deceased herself. No Terms of Business letter was issued to the deceased. There was no indication in the relevant papers of the client’s identification. A copy of the duly registered Disposition was sent by the family solicitor to the defender, in which the family solicitor wrote: “I enclose copy of duly registered Disposition of the above property and I have placed this with the remaining Titles and enclose herewith my own Business Account in the matter for your attention”. [16] There was no record of the Disposition, or any copy of it, being sent to the deceased herself.

The defender said in evidence that it took a matter of weeks for the Disposition to be prepared, and that there was further delay by the deceased after it had been delivered to her for signature. The business account was not addressed to anyone and was in fact paid by the defender with (he said) cash given to him by the deceased. The witness did not see the deceased on the day that he signed the Disposition as a witness. He stated that he did so in the defender’s home. He understood that he was being asked to confirm that he had seen the document. The defender had in fact admitted in his pleadings that: “The witness was asked to witness the Disposition outwith the presence of the deceased. Admitted the witness did not see the deceased sign the Disposition nor did she acknowledge her signature to him. Admitted the witness did not have the mandate of the deceased to sign.” [67].

If these events had taken place after issue by the Law Society of Scotland of its vulnerable clients guidance, the circumstances narrated above might have attracted criticism by reference to that guidance. It is not clear from the Judgment why the pursuer did not seek to have the Disposition declared void on grounds of undue influence. Particularly in view of Lord Clarke’s comments about the case on facility and circumvention, the pursuer might well have had stronger prospects of establishing undue influence than of establishing facility and circumvention. Compare the recent Smyth case (reported in our November 2014 Newsletter) in  which incapacity, undue influence and facility and circumvention were all pled (albeit unsuccessfully).