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Case Summary – Dealing with relatives’ financial affairs – what not to do

13 March 2014

A recent case showed the Court’s dim view of a family’s financial dealings with their elderly mother’s assets & the importance of a Power of Attorney

The recent case of JS and KB and MP (Property and Affairs Deputy for DB) showed the dim view the Court will take of family members who do not deal with their relatives’ financial affairs properly.

In this case, called a “cautionary tale” by the Court, a 90 year old widow with dementia had not made a power of attorney.  Since the mother had gone beyond the stage where she could make a Lasting Power of Attorney, the daughter should, of course, have applied to the Court of Protection to be appointed as her Deputy.  She did not however.

Staggeringly, the daughter managed, through a firm of solicitors it must be said, to sell her mother’s two storey property which was unsuitable for her and to buy a bungalow.  So far so good you might think.  Unfortunately, the bungalow was not put in the name of the mother but in the names of the daughter and her husband.  Not surprisingly, after this, when the daughter did apply to be appointed as Deputy, the Court took the view that she was not a suitable person to act as Deputy.  An independent professional Deputy was appointed instead.

The story does not end there however.  Not only was a charge for 100% of the value registered against the new property by the professional Deputy but the daughter was ordered to pay a substantial amount of the resulting £70,000 Court of Protection costs bill.  Her brother also had to bear some of his own costs, essentially because he should have checked what authority his sister was acting under.  Relationships within the family will inevitably have been damaged as a result of the situation.

If you are asked to look after the financial affairs of a relative or friend, make sure you have the authority to do this.  That might be under a Lasting or Enduring Power of Attorney or it might be as Deputy.  Attorneys and Deputies should make sure that they keep their relative’s money separate from their own and remember that they have extremely limited powers to gift.

Members of Solicitors for the Elderly can read the full column from Lynne Bradey featuring this case in the April edition of the SFE newsletter www.solicitorsfortheelderly.com

If you would like to discuss any aspect of this case further, please contact Lynne Bradey on 0114 267 5588.

The information in this article is necessarily of a general nature. Specific advice should be sought for specific situations. If you have any queries or need any legal advice please feel free to contact Wrigleys Solicitors

Lynne Bradey View Biography

Lynne Bradey

Partner
Sheffield

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