Application for guardianship in respect of NW: Opinion of Sheriff John A Baird (decision 29th April 2014)

Introduction

“Bombshell” is not an extravagant description for the opinion of Sheriff Baird that all continuing powers of attorney (CPA’s) following the wording of the “sample” up till now published on the website of the Office of the Public Guardian (“OPG”) are invalid. That opinion appears in the Judgment, available here on the Scotcourts website, now issued by Sheriff Baird in this case, which featured in a case update provided by Alison Hempsey of TC Young (who acted for the successful applicants) in last month’s Newsletter.

The application began unremarkably. A niece and a cousin of an elderly widow suffering from Alzheimer’s Disease sought appointment as her welfare and financial guardians under the Adults with Incapacity (Scotland) Act (“the Act”, for all statutory references in this article). Only upon intimation of the application to OPG did they discover that a CPA in favour of a bank had been granted and registered in 2008. The applicants sought leave to amend to include a crave under s20(2)(e)(ii) for revocation of the appointment of the bank as attorney, and sought warrant to intimate to the bank.  The bank opposed revocation.  The proposal to appoint the applicants as welfare guardians was not opposed. As reported last month, Sh. Baird held that the CPA was not validly constituted. He appointed the applicants as both financial and welfare guardians. For reasons specific to the facts of the case, he held that even if the purported CPA had been validly constituted, he would nevertheless have so appointed the applicants, which – as he pointed out – would have ipso facto terminated the CPA by virtue of s24(2). Of general concern are Sh. Baird’s two reasons for holding that the purported CPA was invalid. As noted last month, the document was in the bank’s standard form, and the decision raised questions as to whether a large number of powers of attorney (“POA’s”) prepared in the bank’s standard form are invalid. What is new in the Judgment now issued is that one of Sh. Baird’s reasons for invalidity applies also to the “sample” CPA appearing on the OPG website.

The Judgment addresses many other issues of importance and should be read in full by any practitioner engaged in private client or adult incapacity work.

The statutory background

Sh. Baird quotes s18: “[A] power of attorney granted after the commencement of this Act which is not granted in accordance with section 15 [or 16] shall have no effect during any period when the granter is incapable in relation to decisions about the matter to which the power relates”. He then quotes the prerequisites in s15 for validity of a CPA. Critically they include requirements that the POA document “incorporates a statement which clearly expresses the granter’s intention that the power be a continuing power” (s15(3)(b)) and “where the continuing power of attorney is exercisable only if the granter is determined to be incapable in relation to decisions about the matter to which the power relates, states that the granter has considered how such    a determination may be made” (s15(3)(ba)).  Also relevant to discussion of this case is the provision of s15(2) that: “In this Act a power of attorney granted under subsection (1) is referred to as a ‘continuing power of