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Revocation of an EPA - A Far from Average Story

Often in cases where the Public Guardian applies to revoke EPAs, the facts are all too familiar: unpaid care fees, unanswered requests for accounts, and the eventual discovery of misappropriated funds.

Recently though a slightly different set of events has been detailed in P, Re (here’s the link: http://www.bailii.org/ew/cases/EWCOP/2015/37.html).

Priscilla has an Interesting Story

P – who we’ll call Priscilla – has an interesting story. She is currently 74 and comes from an aristocratic family. She has been married four times, presently to H (who we’ll call Henry), and they have been married since 1989. For at least some of that time, and possibly for longer, Priscilla was an alcoholic. She and Henry lived in Spain until June 2012, when she collapsed, remaining unconscious for five days. She never regained the capacity to manage her property and affairs, but can still make a few fairly basic decisions.

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However, in October 1991, she had signed an EPA appointing Henry to be her sole attorney with general authority to act on her behalf with relation to her property and affairs. This was registered in March 2013 and since February 2014 Priscilla has lived in a nursing home in Warwickshire, although Henry still lives in Spain. She is visited two or three times a week by her 72 year old sister S (let’s call her Susan) and has a daughter, D (who we’ll know as Dahlia) from her first marriage, who lives in Spain, as well as a son from her second marriage who lives in London. No mention is made of whether her children visit her, or how often if they do.

Care Fully Funded by NHS

Interestingly Priscilla’s care is currently fully funded by NHS continuing healthcare. This type of care is arranged and funded solely by the NHS where the individual has been found to have a primary health need. Such care is provided to an individual aged 18 or over to meet needs that have arisen as a result of disability, accident or illness. It is not means tested.

Nevertheless, it is perhaps notable that Priscilla’s estate – which excludes any entitlement under a Trust, Senior Judge Lush points out, I think possibly because Priscilla does have an entitlement under a Trust, as do so many members of the aristocracy – consists of:

  • An English current account with a balance of around £10,000;

  • A half share of three properties in Spain, owned jointly with Henry;

  • The property in which Henry still lives, in Spain – the mortgage on this outstrips its value by some 132,000 euros, although it should be noted that Henry and Priscilla are litigants in the group action against the bank, Landsbanki (which went into receivership in 2008), to whom to property is mortgaged;

  • Another Spanish property, free of mortgage and worth about 500,000 euros since the collapse of the Spanish housing market, although it was purchased for 700,000 euros; and

  • Yet another Spanish property, valued at 220,000 euros, also free of mortgage.

Estate Worth Over £400k

This totals, if converted to GBP at the time of writing, an estate owned entirely by Priscilla worth about £441,842.60, without counting the three properties owned with Henry, to which a value has not been attached in the judgement. The bulk of that estate consists of a property portfolio.

Priscilla lacks the capacity to manage and possibly also understand this, and does not have the benefit of good health to fully enjoy it. Those massive sums do not appear to be diverted for her benefit or for what enjoyment she can take from them in any way (maybe this is too harsh, given the Spanish property market as it stands). Put bluntly, even if Priscilla is not one of those aristocrats with the benefit of a Trust, she is worth more at this moment than most people will ever earn in their lives, and it is charitable (or naïve) to assume that she has worked hard all of her life for those enormous sums, rather than being gifted them by virtue of the family into which she was born. She has now been placed into a nursing home in a country other than that in which her husband (and attorney, who is the person making the financial decisions) lives, and her care is funded entirely by the NHS – an entity that is being cut, cut, and cut again while it strains under the weight of an aging population.

The point, in any event, is that there are perhaps no unpaid care fees, unlike many other case reports we see, because there are no care fees to pay. But Henry still has some oddities up his sleeve.

Henry, meanwhile, returned to Spain after Priscilla’s admission to long term care, where he met 42 year old MQ, who we will call Maida, an illegal immigrant to Spain from Iraq who has a son of an unspecified age. Henry is “remarkably candid” says Senior Judge Lush, and I have to agree, about his relationship with Maida.

Henry Moves Younger Woman into Property within a Year

When Priscilla went “suddenly” into care, Henry says, he missed her terribly (and still does). Long term tenants who he calls “dishonest” had just left the property which is worth less than its mortgage, and his daughter had also gone back home, presumably having visited to help him after he returned to Spain. He says he was “standing entirely alone in a pigsty of a place without the faintest idea of what to do and no one to ask for help” when Maida appeared and “moved into the house and, within less than a year, she and her brothers, who have building experience, had transformed it”. He soon moved in with her, vacating the half a million euro home he had shared with Priscilla (and was presumably most certainly not a pigsty), and paid, from his own money, 30,000 euros in un-evidenced repair costs to the three Spanish properties. Presumably at least some of this was paid to Maida’s brothers for their work on the property she had moved into.

Henry admits he “lost his head” at the start of his relationship with Maida, and that since then there has been “a theft of money and broken promises”. He refers to perhaps a predictable development: Maida raided Henry’s bank accounts, removing £12,000 from them. This left him severely overdrawn.

Took Money from Priscilla

Henry therefore took £7,000 from Priscilla to get his accounts out of the overdrafts. He stated this would not in any way inconvenience Priscilla and if she had not lost capacity, she would have agreed to loan him this, apparently unaware that wives do not commonly cheerfully agree to loan their husbands thousands of pounds stolen by mistresses, whether it would inconvenience them or not – especially when, unbelievably, the relationship with the mistress is continuing. The Public Guardian, like me, believes it is highly unlikely Priscilla would have agreed to this loan. Notably, Henry only agreed to repay the loan after Senior Judge Lush suggested it to him.

Henry acknowledges Maida comes from a very poor family, and that her priorities are, logically enough, her future and that of her son. So (and yes, this next part is serious), after she had stolen the £12,000, all she asked for was a property in her own name, which Henry bought for her last year to the tune of 100,000 euros.

Henry further notes various references to Maida bullying him, but says she merely has a bad temper and does this caringly, and has never used physical violence against him.

Public Guardian Shows Concern

At this point it is natural to start to become concerned about Henry – if you weren’t already – but the Public Guardian did not have any evidence that Henry lacks capacity to manage Priscilla’s property and affairs, although I do rather wonder if perhaps someone should have had a fresh assessment done on whether Henry could manage his own, and the Public Guardian is concerned Henry’s decisions were unwise and not in Priscilla’s best interests.

Nevertheless, he did have the capacity in March 2014 to make a power of attorney in Spain in which he appointed his children from his first marriage along with Maida to be his attorneys, and also to revoke the appointment of Maida following the advice of Dahlia: just as well, as it was not clear whether this power of attorney would give Maida legal authority to deal with the three properties in Spain shared by Priscilla and Henry, and the revocation at least means Maida has no legal authority over them.

Finally Henry says that if a civil partnership with Maida has been mentioned, it was merely for a passport, as it is “inconvenient” for her to live in Spain without one, but in any event Maida has always known that this would not be whilst Priscilla was alive (I wonder what the terms of Priscilla’s Will are), because whilst Priscilla is alive, Henry is already married.

Wants to Sell Two of Priscilla's Properties

His witness statement also explained he has faced difficulties in renting or selling any of the properties, although he has received rent from them, which was mismanaged, leaving Priscilla with no benefit. He now wants to sell two of Priscilla’s properties: he suggests he will invest these sums with the advice of a financial adviser but the Public Guardian thought it remained unclear whether P would receive any benefit.

Public Guardian Applies to Revoke EPA

In December 2014 the Public Guardian applied to have the EPA revoked and invite a professional deputy from their panel to apply to act as Priscilla’s Deputy.

Susan, who was notified, acknowledged the application but asked that rather than a member of the panel, she would like to be considered for appointment as Priscilla’s Deputy, along with Dahlia. Dahlia replied on similar terms.

Henry’s response claimed he had been open and honest in all his dealings and wanted to continue to manage things, having “devoted” nearly 35 years of his life to Priscilla. He called her relations “ganging up” on him “shocking and outrageous”, but nevertheless proposed that he share the responsibility with them, for instance by their taking control of her English bank accounts (only one having been listed at a value of around £10,000 by Senior Judge Lush).

The Public Guardian supported the application for Susan and Dahlia to be appointed and noted how helpful it would be to have one Deputy in Spain and the other in England, ensuring effective management of all Priscilla’s assets.

Unsurprisingly, Senior Judge Lush decided there was no need for him to make a formal finding either of Henry’s incompetence or that he lacked integrity because Henry had himself admitted he had taken advantage of his position as attorney to benefit himself by loaning himself £7,000. In addition, he increasingly finds travel to England to be a considerable strain, requiring a fortnight to recover from each journey, and in many ways it would be an act of kindness to relive him of responsibility for the various properties.

Although a few harsh words had needed to be said, the conduct of Dahlia and Susan was described as exemplary, and everyone showed respect and affection for each other. In any event, Deputies do have a duty to consult, and Henry’s views would need to be taken into account as and when Dahlia and Susan made decisions about Priscilla’s property and affairs, said Senior Judge Lush.

Daughters Appointed as Joint & Several Deputies

Dahlia and Susan, unsurprisingly, were appointed as joint and several Deputies and the EPA revoked.

Cases of revocation of EPAs do appear with some regularity, but this is far from the average scenario. The moral of the story is perhaps to seek to recover money stolen by a mistress from the mistress, rather than the wife.