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Advising Expats On The Importance Of Making A Will

BY: Paul / 0 COMMENTS / CATEGORIES: News, Will Writing

Advising Expats On The Importance Of Making A Will

To quote Scarlett O’Hara in Gone with the Wind – “death, taxes, and childbirth, there’s never a convenient time for any of them”.

When it comes to the Grim Reaper, if he comes for your client whilst they are living in a foreign country, he is not bothered about whether they have organised their affairs or not. And few situations are messier than dealing with the fall-out from someone who is domiciled abroad and dies intestate.

An estimated 5.5  million British people live overseas. According to the data, over 1.5 million reside down under (Australia and New Zealand), 761,000 in Spain, 1.2 million in North America, 240,000 living in Dubai, and 212,000 in South Africa.

For succession purposes, where a matter involves more than one legal system it is necessary to apply the conflict of laws (also referred to as private international law (PIL)) rules that determine which law of succession applies. Where the PIL rules of one jurisdiction conflict with the PIL rules of another jurisdiction, it is necessary to determine which jurisdiction can decide the matter.

Fortunately, since 17 August 2015, the rules surrounding dying intestate within the European Union have been simplified. If someone dies in an EU Member State without a Will, the rules of intestacy will be the rules of the country in which they were habitually resident as at the date of their death.

The concept of domicile

The country in which a person is domiciled refers to the nation with which they have the closest ties. A person’s domicile of origin is typically their father’s domicile as at their date of birth.   One can choose to be domiciled in a different country from that where they were born; however, a person can only be domiciled in one country at a time. To establish whether a person has changed their domicile, consideration must be given to whether they have left their domicile of origin and settled in their country of choice and whether that move is permanent.

Conceptually, this may not be difficult. But take the increasingly common case of a mixed-nationality couple, who, once their children have grown up, decide to divide their time between two jurisdictions, e.g. Australia and France; this may continue for many years until one dies without a Will. In such circumstances, establishing which domicile applies is far from straightforward .

The law of intestacy in different jurisdictions

Once domicile or habitual residence is established, the intestacy laws of that country will apply. What many British migrants fail to realise is that other countries’ laws often differ substantially from that of England and Wales.

Australia

Each state in Australia has its own intestacy laws. For example, if the deceased dies in Perth, Western Australia, allocation of the estate is governed by the Administration Act 1903 (WA). Division will depend on the value of the estate and the type and number of potential beneficiaries. Unlike English intestacy law, cohabitees do have inheritance rights under the Administration Act, if they can establish they have been in a de-facto relationship with the deceased for two years or more.

Generally, anyone over the age of 18 who is entitled to a share of the estate can apply for Letters of Administration to the Probate Office of the Supreme Court for the right to manage the estate.

United States of America

Like Australia, each State has its own laws of intestacy. However, the laws are fairly uniform for small estates. In most cases, if the estate is valued at less than $100,000, rather than file Court proceedings, family members can file a Declaration of Small Estate through a bank. In California, this can even be done through the Department of Motor Vehicles (DVA). The person filing the Declaration must swear an oath that no other person has any greater claim to the deceased’s property.

State law varies for estates over $100,000 and where there are spouses or partners, and/or children involved. For example, in New York State , in the case of an intestacy where there is a spouse but no children, the spouse receives the entire estate.  If there is a spouse and children,
the spouse inherits the first $50,000 plus half of the balance. The children* inherit everything else.

Unmarried partners have no right to inherit under New York intestacy law. This has led to a growth in ‘deathbed’ marriages. State law provides the right for family members to have such a marriage annulled if they can prove the nuptials were made specifically to achieve fraudulent financial gain.

Dubai

If an expat dies without a Will in Dubai, the default is that Sharia law will decide who inherits their estate. Sharia law is not codified, and there is no system of precedent in the UAE Courts.

Under Sharia law, if a husband dies intestate, the wife will qualify for only one-eighth of her deceased spouse’s estate. In addition, all assets (including bank accounts and shares) will be frozen until liabilities have been discharged.

Conclusion

For those advising clients who have property in the UK and are likely to acquire assets in the country they move to, it is imperative they are advised on the importance of having a valid Will in place, not only in the UK but in the jurisdiction they are moving to.

Dying intestate in the UK causes complications enough. For the survivors of expats who die without a Will, the resulting administrative and financial problems can be a nightmare – and one that is completely avoidable.

  • by TWP Main Admin
  • Aug 13, 2019

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Forfeiture Rule Modified In Assisted Suicide Case

BY: Paul / 0 COMMENTS / CATEGORIES: News

Are we ‘living’ longer or merely being kept alive well beyond our individual natural expiry date?

As modern medicine continues to improve, death and old age is rapidly becoming viewed as almost an act of personal negligence.  The medical profession and those struck down with illness are encouraged to ‘keep fighting’, sometimes long after disease has already won the battle and all that is left is a living corpse, denied the dignity and peace of death.

In a sensitive and poignant article by Katy Butler, the agony of prolonging death is laid bare:

“My father Jeffrey—a retired Wesleyan University professor who’d tossed me laughing into the air when I was a baby and taught me to read when I was four—had suffered a devastating stroke at the age of 79. A year later, to correct a slow heartbeat, he’d been casually outfitted with a pacemaker that kept his heart going until his life became a curse to him rather than a blessing. He’d told my mother, “I’m living too long.”

By the time the hellish summer of 2006 arrived, he was 84 and I’d come to believe that his pacemaker should never have been installed at all. The man I loved more than any other was going blind and falling into dementia. He did not understand the purpose of a dinner napkin and when I visited, I had to coach him to take off his slippers before he tried to put on his shoes. In June, he spent an entire weekend brushing and re-brushing his teeth. In August, he suffered a brain haemorrhage, fell in the driveway, and spent nearly a week in Yale-New Haven hospital, where he suffered a terrible form of cognitive decompensation, often afflicting the elderly, known as “hospital delirium.” When he came home, he asked my brother Michael why the living room was filling up with leaves.”

There is another side to modern life and advancements in access to information; should we be struck down with a degenerative disease, dementia, or a slow-acting but terminal cancer, we are under little illusion of the pain and indignity that lies before us.  For this reason, and because we can be kept ‘existing’ for many years, in a state few would describe as living.  And this has brought the debate of ‘assisted suicide’ to the fore, with each new case which hits the headlines challenging our concepts of morals, death, and the right to control our own lives to the end.

Helping someone die and the rule of forfeiture

The recent case of Ninian v Findlay [2019] EWHC 297 (Ch) provides a small, but significant advancement in the law surrounding assisting a loved one to die.

Section 1 of the Forfeiture Act 1982 states:

The “forfeiture rule”.

(1) In this Act, the “forfeiture rule” means the rule of public policy which in certain circumstances precludes a person who has unlawfully killed another from acquiring a benefit in consequence of the killing.

(2) References in this Act to a person who has unlawfully killed another include a reference to a person who has unlawfully aided, abetted, counselled or procured the death of that other and references in this Act to unlawful killing shall be interpreted accordingly.

The case concerned a widow of an 80-year-old man who was diagnosed with a progressive, incurable, degenerative disease.  Three years after being diagnosed, he made the decision to end his life through accompanied suicide and contacted the Dignitas clinic in Switzerland.  At the time his wife was unaware of his decision.  When she discovered his plans, she tried to dissuade him, but he was determined.  She convinced him to tell his doctor and to look into palliative care options.  However, she also assisted with much of the administrative aspects of applying to the Dignitas Clinic and made the necessary travel arrangements as he was unable to speak.  And because she loved him, she accompanied him to the clinic.

The widow was never prosecuted for her actions as the police concluded that to take such a step would not be in the public interest.

The widow made an application under section 2 of the Forfeiture Act 1982 to have the forfeiture rule modified or excluded.  Such action could be taken by the Court if it was felt justice demanded it.

Section 2 of the Suicide Act 1961, which provides for the offence of encouraging or assisting suicide, was first considered.  The Court noted that in 2010, substantial amendments had been made to the Suicide Act with the aim to clarify the existing law.

The offence was held to comprise two elements: performing an act capable of encouraging or assisting the suicide (the actus reus) and establishing that the act was intended to encourage or assist the suicide (the mens rea).  It was not necessary that the act actually encouraged or assisted the suicide, only that it was capable of doing so.  Thus, the actus reus was objective, whereas the mens rea was subjective.

It was concluded that the widow had not wanted her husband to go to the Dignitas Clinic.  However, it was her actions that made the trip possible.  Therefore, when viewed objectively, the acts of the widow were capable of assisting suicide, and she had the necessary intent to help her husband end his life, despite her objections.  This meant the elements to constitute an offence under section 2 of the Suicide Act were satisfied.

Once it was established that the forfeiture rule applied, as it did in this case, the Court may have regard to the Claimant’s conduct and material circumstances of the case when deciding whether or not to exercise its discretion.

The Court examined the dissenting decision of Lord Justice Mummery in Dunbar v Plant [1998] Ch. 412, [1997] 7 WLUK 487, whereby the scope of discretion was discussed, and paragraphs 43-45 of a publication issued by the Director of Public Prosecutions entitled “Suicide: Policy for Prosecutors in Respect of Cases of Encouraging or Assisting Suicide“, which set out the factors tending for and against prosecution.  It was decided that although the dissenting opinion in Dunbar was not determinative, the fact the CPS declined to prosecute was a powerful factor in the Court granting relief from forfeiture.

Conclusion

It is safe to say that these types of cases will become more frequent.  Regardless of what the law states, compared to even 10 years ago, people are more educated, wealthier, and have access to the information and means to take matters into their own hands when it comes to the right to die.  Anyone who has loved knows that they would do anything to end their beloved’s suffering.  And if relief from forfeiture is not granted, is it not a final insult to the bravery of the person who has taken matters into their own hands, to refuse to honour their last wishes via their Will?  Or do we need to stand firm, and apply the law rigidly, until Parliament resolves the matter of whether a human being has the right to decide when to die?

What do you think?

  • by TWP Main Admin

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What Happens to your children

BY: Paul / 0 COMMENTS / CATEGORIES: News

A guide to appointing guardians in your will.

There is a general conception that Wills are for the elderly and those in ill-health, but life is uncertain and everyone needs a Will, to ensure your hard-earnt assets go to the people or causes which you care the most about.

Certain events prompt people to make a Will such as an increase in personal wealth, buying a property and having children.

When parents make Wills, they want to ensure that their children are provided for in the best way. Whilst the primary focus is usually on financial provisions, what about your children’s welfare, especially if both of you die?

Nobody wants to think about dying young or leaving their children behind, especially young children but what happens if you should die before your children reach the age 18? Those under the age of 18, in the eyes of the law, are classed as minors. If their parents are dead, they will need a legal guardian to help and support them.

A guardian may be appointed through a Will to have parental responsibility for your children. Parental responsibility means all the legal rights, powers, responsibility and authority of a parent (as stated in the Children Act 1989.)

Guardians have the legal rights and responsibilities of parents. In many cases the children will live with their guardians, but this is not always possible or necessary. For instance, the parents may be divorced and the children live with their mother. Father dies and by his will he appoints his parents as the guardians of his young children. The children continue to live with their mother the guardians (grandparents) are able to help make the major decisions and will have rights to have regular contact with the children

Whether you are thinking of making a new Will or revising a current Will to ensure that your children are looked after, here are a few things you may want to consider.

What happens with your children if guardians are not appointed?

If you do not appoint a guardian, an application to the Family Court may be necessary. This may be by a family member or by local Social Services.

In some circumstances, children could be placed in care until the court appoints a guardian, which could be lengthy and add to your children’s distress.

A verbal agreement between family and friends is not considered to be enough to satisfy the Courts of a guardianship.

What if I am divorced?

On divorce you will usually have retained parental responsibility for your children even if they do not live with you. As a result, you will be able to appoint a guardian. Because of the divorce, this can be a particularly sensitive issue and you will need legal advice tailored to your circumstances and the needs of your children.

When do you need to appoint a Guardian?

If you are married at the time of your child’s birth and either the mother or the father dies, the surviving parent will have parental responsibility for the children. Similarly, if you are not married and a father dies first, the mother will retain parental responsibility. However, if you are not married, the father will only have sole parental responsibility where he is named on the birth certificate of a child who has been born after 1 December 2003.

What are the benefits of appointing guardians?

  • You can be sure your children are going to be looked after by someone you have chosen and trust.
  • You will know that important decisions in your children’s life such as education, housing, medical treatment are in the hands of someone who knows of your plans or who can be trusted to make sensible plans
  • You can leave money to your guardians to cover the costs they will incur, so that you know your children would be bought up comfortably without financially burdening their guardian.
  • You can might be able to make your house available for your children and their guardian

How to choose a guardian?

Being a guardian is a big responsibility. You must discuss it with the people you choose and get their input and agreement.

You can appoint up to four guardians in your will and these are some of the things you may want to think about:

  • Who is most able to care for child emotionally, financially and physically?
  • Who do your children already feel comfortable with?
  • Who can provide similar parenting styles and values of your own?
  • Would the person have enough time and energy to devote to your children?
  • Would your children have to move far away and uproot their life?
  • Does the person you’re considering have any other children?

Most people appoint only two guardians, such as another couple. It is usual for a couple to appoint the same guardians in relation to their children as they usually only become effective on the death of the second parent. However, young couples with children commonly appoint both sets of the children’s grandparents and leave a separate letter of guidance incorporating the above factors as to how they wish for their children to be provided for.

We always recommend naming substitute guardians especially if your original guardians are older than you (e.g. if you are appointing your own parents). This can save you having to change your Will in the event your primary guardians are unable or unwilling to act.

A guardianship clause may be changed or cancelled as often as you like during your lifetime, to fit with changes in your personal circumstances.

Naming a guardian should be regarded as an important part of any parent’s estate planning, if not the most important. By including a guardianship clause in your will, the appointment is easily identifiable and can be considered quickly. You can see that issues relating to guardianship can become very complex. These are some of the most critical decisions you will make to protect your children

 Sophie Sullivan

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Secure Website

BY: Paul / 0 COMMENTS / CATEGORIES: News

Secure Website

We operate a secure website so that our clients and visitors in general can browse the site and use our online will writing forms with full confidence. To signify this when using an SSL Certificate, so browser’s use a padlock symbol in the path window at the top of your screen.

It should look like this:

SSL Certificate

So when you use our website to view information about estate planning online you can rest assured of the security of our site. On top of that you are also safe in the knowledge that we’ve been writing wills since 2008. Your contact information is safe with us and so is the future of your assets and the family you intend it all to go to.

Our wills have been proven many times and have been upheld by the courts and many grants of probate have been issued following production of one of our wills.

We look forward to helping you when contact us to arrange a free home visit to discuss your requirements.

Contact us here :

Or 01325 324515

Email: info@empsolutions.co.uk

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Why do we have funerals?

BY: Paul / 0 COMMENTS / CATEGORIES: Funeral Plans, News

 

Funeral and burial traditions have been dated as far back as 100,000 years ago with modern human remains found in Qafzeh, Israel. There are even some findings which suggest evidence of intentional burials by Neanderthals dating back 250,000 – 300,000 years ago, however many of these sites are a topic of controversy between experts.

With evidence of burial traditions dating back throughout the ages, taking care of the deceased remains part of our culture today despite changes in funeral traditions. But why do we do we have funerals?

For early societies with religious beliefs, and for believers across many of today’s faiths, a funeral ceremony will usher the dead on to the next life. During ancient times many had believed their loved ones would not be able to cross over to the next life if they did not have the rites and rituals of a properly conducted funeral.

Modern funerals can tie to the sentiment of securing entry to the next life but generally involve a much more dignified and affectionate send off for the deceased. Whether the funeral involves religious beliefs or not, it still plays a very important part in coming to terms with the loss of a loved one.

Time to stop and think

Immediately after a death there can be a lot to do and the funeral might be the first real opportunity the family have to stop, and begin to acknowledge that the deceased is really gone, with their friends and family.

A co-founder of the What’s Your Grief website, Litsa Williams, has written about how funerals can be the starting point for grieving.

“It can be a really important ritual and the first step for so many people, and as much as you may be dreading it, you may be surprised at the comfort you find in meeting people you may never have known were touched by your loved one in some way.”

A funeral can be an important opportunity for people to gather together and demonstrate their love and respect for the deceased while offering support and sympathy to the bereaved. The death of someone close is clearly a difficult time and having people around that care for the bereaved and the deceased can be a considerable comfort.

 

A celebration of life

More often now the funeral is seen as an opportunity to celebrate a life well lived. There are less strictly regimented religious ceremonies with the funeral featuring more reflective elements which are unique to the personality of the person that has passed.

From a cheerful dress code to a quirky music choice, funerals can be an opportunity to remember the wonderful personality of a loved one who is missed but never forgotten.

At a time of great upset, a funeral with well-known ceremonies can offer some familiar structure for people close to the departed. The familiarity of words spoken and songs sung during these ceremonies can reduce some of the burden of having to think about what to do next and instead let us focus on our feelings.

No matter how people choose to mark their passing or the passing of a loved one, the familiarity of funeral ritual is also a factor in why we take such care over funeral planning. Whether to prepare the way for the next life, to gather friends and family to say goodbye or just to have one final opportunity to demonstrate our individuality, funerals are an important part of our passing.

E.M.P SOLUTIONS CAN PROVIDE PRE-PAID FUNERAL PLANS TO SUIT ALL YOUR NEED’S https://www.safehandsplans.co.uk/aff/90/e.m.p-solutions-will-writing

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COMMON MISTAKES IN LASTING POWER OF ATTORNEY APPLICATIONS

BY: Paul / 0 COMMENTS / CATEGORIES: News, Power of Attorney


A poorly drafted Lasting Power of Attorney (LPA) can lead to unnecessary stress and expense for the Donor or the draftsman, or in the worst cases leave a vulnerable person without any LPA in place at all. This month’s CPD will consider the common errors that even the professional draftsman can make when drafting instructions for LPAs of any type.

WHAT’S THE ISSUE?

LPAs are complex legal documents and care must be taken when drafting them to ensure they are completed correctly. The Office of the Public Guardian (OPG) will reject any forms that are completed incorrectly or that don’t meet their standards. According to the OPG around 15% of LPA forms submitted to them have errors.
Getting it wrong can be expensive if the mistake isn’t recognised until registration. The registration fee for LPAs is £82 per document. If they are rejected, they must be corrected and re-registered and this costs £41 per document if sent back within 3 months. If the corrected forms are sent back outside of this time limit you will need to pay the full fee again.
If the registration doesn’t take place until after the Donor has lost capacity, then they may be left with no LPA in place at all if a mistake is found. At this point it will be too late to correct the form and resubmit it. This is why it is so important that the forms are completed correctly, and appropriate advice taken if you are unsure about any aspect of the form or how you can put the Donor’s wishes into practice.

PROBLEMATIC INSTRUCTIONS
The most common errors with instructions that cause issues for LPAs are:
• Lack of clarity
• Making contradictory statements
• Attempting to ask an Attorney to act beyond their powers
• Legally invalid instructions
• Incorrectly handling how replacement Attorneys will start acting
Often a Donor will have very specific wishes in mind for how their Attorneys should act and what kinds of decisions that can make and how they should make them. Unfortunately, what the Donor wants isn’t always legally possible so it’s essential to explain the limitations of Attorneys powers and manage a client’s expectations when it comes to drafting instructions.

CONTRADICTORY STATEMENTS

Instructions are legally binding on the Attorneys and they must be followed. It’s therefore incredibly important that any instructions are clearly written and legally valid. If the instructions aren’t valid then the OPG may refuse to register the LPA or may need to apply to the Court of Protection (COP) to have the offending instruction severed.
Instructions can be invalid because they are too vague and cause uncertainty in what the Attorney is actually allowed to do. When drafting instructions make sure that there is no room for misinterpretation and that what is expected of the Attorney is sufficiently clear.
Instructions that contradict other sections in the LPA will cause the LPA to fail at registration. The most common invalid instructions are those that are incompatible with the way the Attorneys are appointed in section 3 of the form. Where the Donor has appointed multiple Attorneys to act, they must decide on how they will make decisions. There are three available options here:

1. Jointly and severally
If Attorneys are appointed to act jointly and severally, they may act either together or independently. This allows more flexibility as any one of the Attorneys may act alone. Especially useful where a decision needs to be made urgently.
Problems arise where a Donor then includes instructions that impose further restrictions that contradict this appointment. Common examples include stating that the Attorneys must act together in certain circumstances, or that one Attorney has a deciding vote. These types of instruction are contrary to what the Donor has selected in section 3 of the form and would have to be severed.
For a recent case example of this see JF (Case No 12925291). In this case the Donor had appointed three Attorneys and, in the instructions, had stated “My two daughters (if surviving) must always agree on any decision jointly before any actions regarding my estate can be implemented. OM may act as an attorney independently of my daughters.” The OPG would not register the LPA as the instruction contradicted the nature of the Attorney’s appointment, so they applied to the COP to seek a severance of the instruction.
The COP recognised that severing the instruction would lead to an LPA that didn’t match the Donor’s wishes, and also recognised that the Donor could achieve what she wanted only by executing two separate LPAs. The Donor consented to the severance, so it was directed that the instruction was severed, and the LPA registered without it.
In the same run of severance applications to the COP (they tend to be reviewed in bulk) the COP also heard the case of SH (Case No 1291136T). In this one they directed for an instruction to be severed as the instruction “While my attorneys are authorised to act jointly and severally I specifically direct that all decisions must be made by at least two of my attorneys and that no attorney has the power to make decisions individually.” was incompatible with the joint and several appointment they had made.

2. Jointly
If Attorneys are appointed to act jointly then they must act unanimously. If one Attorney becomes unable to act the remaining joint Attorneys also become unable to act. As such, any instruction stating that the Attorneys must act by majority.
Up until recently it was also impossible to re-appoint surviving joint Attorneys as replacement attorneys, with the effect that if one joint Attorney stopped acting the survivors continued. It was assumed that if the donor appointed A, B and C as joint Attorneys that they wanted them to act all together or not at all, so naming them all as replacements so they could be ‘reappointed’ if one died contradicted this. Donors have previously been told to avoid such appointments as they would fail. This position has changed with the case of Miles v The Public Guardian and Others [2015] EWHC 2960 (Ch).
In Miles the donor had appointed her attorneys A and B to act jointly in certain transactions, and jointly and severally in regard to everything else. She only wanted her replacement attorney C to act if both A and B could no longer act. The wording used was as follows:
“My attorneys may act jointly and severally save with regard to:
1. any sale of my property at [and it set out her address] (or any property which may subsequently replace it); and
2. any transaction in excess of £10,000
when all surviving attorneys who are capable of acting (whether originally appointed or who have been appointed by and are acting in substitution) shall act jointly in so far as there may be more than one of them able to do so but in the event that there is only one of them capable of acting I expressly re- appoint that attorney to act alone.”
It was held that this provision was valid as there was nothing in the MCA 2005 that expressly prohibited it. In his judgement Lord Justice Nugee did admit to finding part of the drafting confusing, specifically the wording in the second set of brackets. This highlights the need to be especially clear when drafting such complex instructions. To that end the following wording was suggested in Miles as a means of appointing joint attorneys with provision for the survivor of them to act alone:
“I wish my attorneys A and B to act as follows:
(1) So long as both attorneys are able and willing to act, I wish them to make the following decisions jointly: sale of the house; transactions over £10,000 [or the like] but all other decisions to be made jointly and severally;
(2) In the event that one of my original attorneys A and B is unable or unwilling to act, I then appoint the remaining of my original attorneys A or B, as the case may be, as replacement attorney to act solely;
(3) In the event of both my original attorneys being unable or unwilling to act, I appoint C as a replacement attorney to act solely [with whatever variations the case requires].”
Note that the OPG have not yet updated their official guidance (LP12) since this case, so the OPG may still query such an instruction at registration.
3. Jointly for some decisions, jointly and severally for all other decisions.

This option is the hybrid power, so it’s benefits and drawbacks mirror those of joint and several/joint appointments.
Instructions must apply equally to all Attorneys named on the form. It isn’t possible to appoint A, B, and C and state that A and B can only make decisions about the Donor’s personal finances and C can only make decisions about the Donor’s business. At least not within a single form. To achieve something like this the Donor would need to make and register two separate LPAs.

INSTRUCTIONS THAT GO BEYOND AN ATTORNEY’S POWERS

The powers that Attorneys have under both Health & Welfare and Property & Financial Affairs LPAs are quite wide and cover nearly all aspects of dealing with an incapacitated person’s daily affairs. They are subject to some statutory restrictions, however. By way of example, Attorney’s cannot change the donor’s Will, consent to a marriage or divorce, or vote on their behalf.
Attorneys must also act solely in the best interests of the Donor and are excluded from making decisions that are in the best interests of anyone else, even if connected to the Donor. An instruction directing Attorneys to make provision for someone else would therefore be invalid unless the Donor had a legal obligation to maintain that person. In the case of Re Strange (an order of the Senior Court Judge made on 21 May 2012) the court was asked to consider whether guidance in an LPA asking the attorneys to maintain the donor’s husband was valid or whether it needed to be severed as contravening the attorneys limited powers to make gifts. The wording of the guidance was as follows: “I wish my attorneys to provide for the financial needs of my husband in the same manner that I might have been expected to do if I had capacity to do so”. It was held that the guidance in the LPA was valid as any spouse would have a statutory duty to maintain the other spouse. That said, legal advice ought to be sought before including such an instruction.
Instructions directing the Attorneys to maintain anyone who is not a spouse or civil partner, or dependent child of the Donor would be invalid and would have to be severed. In their practice note “Giving gifts: a guide to the legal background for deputies and attorneys” the OPG themselves suggest that a Donor may normally rely on being able to direct their Attorneys to maintain a person only if they have provided for those needs in the past, or it is reasonable to conclude that the person would have provided for those needs.
Even where the maintenance provision is allowed you must be incredibly careful in how this is drafted. In the case of Re Bloom (an order of the Senior Judge made on 16 March 2012). Here the instruction referred to making provision for the Donor’s wife for her ‘maintenance and benefit’. The words ‘and benefit’ were severed by the COP as this was too wide and went beyond just maintenance.
A further example of common instructions that go beyond an Attorney’s power relates to gifting. Attorney’s only have limited powers to make gifts of the Donor’s property. Under section 12 of the MCA 2005 an attorney may dispose of the Donor’s property by making gifts in the following circumstances:
(2) the Donee may make gifts –
(a) on customary occasions to persons (including the attorney) who are related to or connected with the donor; or
Page 5 of 7
(b) to any charity to which the donor made or might have been expected to make gifts.
The value of the gift must not be unreasonable in all of the circumstances, and many factors will be taken into account to determine what is reasonable, amongst them the size of the donor’s estate.
Section 12(3) defines ‘customary occasions’ as:
(a) the occasion or anniversary of a birth, a marriage or the formation of a civil partnership; or
(b) any other occasion when presents are customarily given within families, or among friends and associates.
Under section 23(4) the Court of Protection may also authorise the making of gifts that are not covered by section 12(2), such as larger gifts or gifts made for inheritance tax planning purposes
Any instruction in an LPA that attempts to extend an Attorney’s power to make gifts will be invalid and will have to be severed before the LPA can be registered. The following types of instruction would be invalid:
• directions to set up trust funds for the donor’s grandchildren
• gifts at non-customary occasions
• regular maintenance payments to people the donor is not legally obliged to maintain
• loans
• lump sum payments to the donor’s adult children upon a certain event such as marriage or purchase of a house.

LEGALLY INVALID INSTRUCTIONS

Instructions that ask the Attorneys to do anything illegal are obviously invalid, so any instructions attempting to induce the Attorney into committing a crime are impossible.
This crops up in LPA forms more often that you would think. Each year the OPG deals with around 120 cases where an instruction has been included in an LPA that is asking the Attorney to assist the donor’s suicide in some way. Under section 2 of the Suicide Act 1961 it is illegal to assist a person’s suicide. This includes helping them to attend a euthanasia clinic in a country where this is perfectly legal. Therefore, any instruction in an LPA directing the Attorney’s to assist the Donor in ending their life is invalid and would have to be severed by the COP before the LPA could be registered.
Instructions made in the wrong type of form are also legally invalid. An instruction in a Health & Welfare LPA regarding dealing with the Donor’s finances or vice versa would be legally invalid as the Attorney has no authority over this.
PROBLEMS WITH REPLACEMENT ATTORNEYS
Replacement Attorneys may only step in if an original Attorney dies, loses mental capacity, disclaims their appointment, divorces/dissolves their marriage/civil partnership to the Donor, or in the case of Property

& Financial Affairs LPAs becomes bankrupt. These ‘trigger events’ are covered in section 13 of the MCA 2005.
You must avoid including any instructions in an LPA that direct for a replacement Attorney to step in and start acting upon any event other than those trigger events listed above as this would be invalid.
The following types of instruction would be invalid and would need to be severed:
• A direction for a replacement would step in temporarily to cover an original Attorney who has gone on holiday
• A direction for a replacement to step in when requested by the original Attorneys
• Where original Attorneys were appointed jointly and severally, a direction for the replacement to step in and totally replace both original Attorney’s when only one had become unable to act.
It is something that is commonly requested, but it is impossible to state that a replacement Attorney will replace a replacement Attorney. If a Donor wishes to name Attorneys, followed by replacements, and then also name a third level of replacements they would need to make and register two separate LPA forms. One form should appoint the original Attorneys and their replacements, and the second form should name the third level of replacements as the main Attorneys but also include an instruction to state that it will only come into force if the original LPA fails.

HOW INVALID INSTRUCTIONS ARE DEALT WITH

If a provision in an LPA is invalid the OPG can apply to the COP to have the instruction severed so the LPA can be registered. The COP deal with around 100 severance applications a month, taking up a lot of court and OPG time as well as causing long delays to registration and stress to Donors. Under Schedule 1, Paragraph 11 of the Mental Capacity Act 2005 the OPG has a duty to apply for severance where an LPA contains an invalid provision and they cannot register a defective LPA until the COP makes a ruling on the case and directs them to register.
Before going to these lengths, the OPG will contact the Donor if they still have capacity and present them a choice. They may choose to go ahead with the severance application, or they can draft a new LPA that removes the invalid instruction and giving them a chance to change the instruction to achieve their aims in a way that the OPG don’t find issue with. This would involve paying a new registration fee though.
If the Donor lacks capacity at the time the registration is made then this option of redrafting the LPA is lost, and the OPG may only apply to have the offending instruction severed. They will contact the Attorney’s for their consent to the severance, as they would the Donor if they had capacity. The unfortunate consequence of this is that this may lead to an LPA being registered that no longer meets the aims of the Donor.

CONCLUSION
When it comes to drafting instructions for LPA’s we can’t stress enough how important it is that the instructions are clear, concise, and legally valid. If you are ever unsure of how likely an instruction is to be accepted then we recommend first turning to the OPGs own guidance on LPAs (Form LP12)

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Modernising Succession

BY: Paul / 0 COMMENTS / CATEGORIES: News

From the SWW College of Will Writing

Modernising Succession: Law Commission Consultation

Last month (13th July 2017) the Law Commission launched a consultation paper to tackle issues surrounding the law of Wills, chiefly aiming to bring Wills into the modern age. The Law Commission has highlighted the age of the current legislation as a root of the problem and suggested that the law needs to be modernised to reflect changes in society, technology and medical understanding – we’ve come a long way since the Wills Act was first introduced in 1837.

This month’s paper will examine some of the main proposals put forward by the Law Commission, focusing mainly on matters related to capacity.

WHY THE NEED FOR MODERNISATION?

The underpinning statute for succession law is the Wills Act 1837 (WA 1837). This has been updated over the years as changes in societal norms have called for it, for example the latest significant amendment was the addition of section 18(5) and section 18D to take account of the provisions of The Marriage (Same Sex Couples) Act 2013. Before that the WA 1837 saw the addition of sections 18B-C to reflect the introduction of Civil Partnerships via the Civil Partnership Act 2004. So while the WA 1837 has been updated over the years, perhaps after nearly 200 years it’s time for a review.

Our understanding of mental health and capacity has also moved forward since the main case setting out the legal test for capacity was decided in 1870 (Banks v Goodfellow [1870] LR 5 QB 549).

Modern families need a more modern approach to succession. More people are cohabiting without marrying or forming a civil partnership, and more people are remarrying and merging families.

More needs to be done to address digital legacies and the increased reliance on technology, possibly by introducing electronic Wills in future.

THE MAIN PROPOSALS:

For ease of reference to the summary of the consultation paper this paper uses the same headings.

Electronic Wills

To meet the formality requirements of s9 WA 1837 a Will must be in writing. Currently a Will may be prepared electronically using a word processor or Will writing software, but at some point it must be printed and sent to the client to be executed. A wet ink signature by the testator and witnesses is required.

People are become increasingly reliant on technology and expect to be able to manage many of their affairs online; from mobile banking to managing billing accounts online, so why not their Will? The Law Commission proposes developing this area of law so that Wills could be validly executed electronically, making the whole process digital and introducing ‘electronic Wills’. This could make the whole process of Will drafting cheaper and more convenient for the Will Writer and testators. Page 2 of 6

Electronic Wills could make making a Will more convenient, thereby increasing the amount of the population who make a Will. They could be especially convenient for testator’s with physical disabilities who would be more likely to engage with a fully online service. They could also be stored more securely, with much less chance of being lost than a physical copy tucked away in a drawer in the testator’s home. There is also potential for an electronic Will system to be linked to an electronic probate system that would streamline the whole process of admitting a Will to probate.

No other jurisdiction has successfully introduced electronic Wills. To do this new legislation would need to be introduced to recognise electronic signatures in the context of executing Wills. The Law Commission has identified two main challenges to introducing electronic signatures to Wills. These are security and infrastructure.

In terms of security the electronic signature must be more than the testator’s named simply typed. This is too susceptible to fraud as any electronically typed name looks the same no matter who types it. Similar problems apply to digital images of written signatures. More complex methods would be required such as biometrics or encryption based signatures that could be linked to the testator more reliably. The Law Commission concludes that electronic signatures must obviously be at least as secure as handwritten signatures, and as there are various means of making an electronic signature special legislation will be required to address how to assess what is a secure enough electronic signature for a valid Will.

Regarding infrastructure, the systems used to enable making and executing a Will electronically must be accessible. Adopting too rigid requirements could have the opposite effect and discourage people from adopting electronic Wills. There would be similar barriers to overcome with cost; if the price of developing a secure electronic Will system is too high people will not take it on.

Supported Wills

A formal support scheme has been proposed for assisting those with diminished capacity to write a Will. Many people with capacity issues are supported by their friends, family, and carers who help them make decisions. Currently the system allows for supporting testators in their decision making to an extent, for example by providing extra assistance to help a testator with communication issues, or by using various methods to help a testator understand the extent of their estate. However, the current legal test for capacity does not actively promote supported decision making so new legislation may be required moving forward.

It is suggested that a system of supported Wills would assist these people and fill the gap between those who have the capacity to make their Will and those who lack capacity and who must apply for a Statutory Will.

This may give more people the ability to write a Will, giving people with diminished capacity greater testamentary freedom. Of course this will still need to be balanced with providing protection for testator’s and preventing people being unduly influenced.

This would ensure that fewer people with diminished capacity would need to apply to the Court of Protection in order for a Statutory Will to be prepared; keeping costs down for them as any formal support Page 3 of 6

scheme would be cheaper than the process of applying for a Statutory Will, although it would likely be publicly funded.

Capacity

Since the introduction of the Mental Capacity Act 2005 (MCA 2005) there has been debate over whether the statutory test should be applied when assessing testamentary capacity or whether the common law test should continue to be applied. It is proposed that testamentary capacity should be governed by the capacity test in the MCA 2005 rather than the current common law test in Banks v Goodfellow, effectively putting an end to that uncertainty.

The language of the common law test could be described as archaic, so bringing the language up to date would be beneficial for testator’s and practitioners seeking to apply the test.

This leading case on the legal test for capacity was decided in 1870, and since then our understanding of mental health and disorders that can effect capacity has greatly improved. In the case of Key v Key [2010] EWHC 408 the effect on a testator of bereavement was considered when applying the common law test, which was not made with this in mind. To address the needs of an aging population and reflect our greater understanding of disorders than can affect a person’s capacity it is suggested that a new test of capacity is needed.

The two-part capacity test offered by section 2 of the MCA 2005 applies in multiple contexts and should be familiar to Will Writers, legal professionals, medical practitioners and others whose opinion will be sought when assessing capacity. Applying the statutory test would also unify the laws approach to capacity, as currently there are circumstances where the statutory test is applied, for example in relation to Lasting Powers of Attorney and when determining capacity for Statutory Wills, and other circumstances where the common law test applies.

The presumption of capacity, unless otherwise proven, is particularly important in the Law Commission’s view, as it draws attention to the English legal system’s ‘functional approach’ to capacity and the fact that capacity must be assessed on a case by case basis. The starting point must always be to presume that a testator has capacity, a drafter cannot assume that a testator lacks capacity on the basis of advanced age or medical condition as this alone is not enough to prove a testator lacks capacity.

The consultation recommends providing statutory guidance for doctors and others carrying out capacity assessments. The MCA 2005 is already supported by a code of practice, and the Law Commission proposes including guidance on applying the statutory test specifically to those writing Wills to this code of practice.

As an alternative to the above, the consultation paper also discusses the merits of bringing the common law test up to date by statute. This would mean that the common law test could be redrafted and made more accessible by using modern language. It would also bring it up to date with current medical understanding of capacity, defeating the criticism that the current test is outdated and was decided at a time when mental health and the range of factors that can effect capacity were not properly understood. Furthermore, it would also be an opportunity to clarify key aspects of the test. Page 4 of 6

Knowledge and approval

A testator must know and approve of the contents of their Will at the time of its execution. This is clearly closely linked to capacity. A testator may have the required testamentary capacity but fail to understand the content of their Will. A testator may still have sufficient knowledge and approval even if they do not understand the language used by the drafter exactly, for example technical legal terms, as long as they know the effect of their Will.

Where a testator lacks knowledge and approval their Will is invalid. It is for the person propounding the Will to establish that the testator had knowledge of and approved the contents of their Will (In the Estate of Sherrington, Sherrington v Sherrington [2005] EWCA Civ 326, [2005] 3 FCR 538).

Where a testator has read their Will or had it read over to them before execution, or where the contents have been brought to their intention in any other way such as through sign language, and the Will has been executed, a rebuttable presumption that the testator knows and approves of the contents of their Will arises.

Currently there is overlap between knowledge and approval and undue influence. There are many cases where a Will has been challenged on the grounds of lack of knowledge and approval when it would be more appropriate to challenge it on the grounds of undue influence. The full consultation paper identifies 3 main reasons for this, but combined they all highlight a failing in the application of undue influence. These reasons summarized are as follows:

 Where lack of knowledge and approval is alleged the burden of proving the testator had knowledge and approval lies on the person propounding the Will, whereas the onus lies on the person challenging the Will when undue influence is alleged. Worse, the person who challenges the Will on the grounds of undue influence and loses their case will find themselves paying the court costs.

 People are generally reluctant to accuse a family member of fraud or undue influence, so a claim of lack of knowledge and approval is preferred

 Claims of lack of knowledge and approval can be used to ‘cloak’ what is really a claim of fraud or undue influence, as was the case in Wintle v Nye [1959] 1 All ER 552

The Law Commission’s proposal is to narrow the scope of knowledge and approval to make it clear that the test of whether a testator knew and approved of the contents of their Will is entirely separate from the question of whether they freely executed the Will and were not coerced.

Signing on a testator’s behalf

A Will must meet the formalities of s9 in order to be valid. A key requirement is that a Will must be signed by the testator, but may be signed by some other person in the testator’s presence and at their direction (s9 (a) WA 1837). This is all the legislation has to say on the matter. Under the current law no restriction is imposed on who may sign the Will on the testator’s behalf; this could be a witness, the drafter, or even a beneficiary of the Will. Page 5 of 6

It is suggested that the law should place restrictions on who can sign on the testator’s behalf as the current position is too wide and could leave a testator open to fraud. It seems reasonable to place restrictions on who may sign a Will on behalf of the testator, as there are already restrictions on who may witness a Will so logically it makes sense for similar restrictions to be imposed on who may sign it.

Undue influence

If a Will is made as a result of the testator being subjected to fraud, fear, or undue influence it is invalid; however the onus is on the person claiming the undue influence, there are no presumptions to assist the person challenging. There is also a high burden of proof on the person claiming undue influence. Testamentary undue influence appears to be limited to cases where the testator was coerced, or enough pressure was applied to overpower the testator’s freedom of action. The courts are more inclined to find undue influence where the testator is physically or mentally weak, as where a testator is mentally weak less pressure may be required to overbear their Will.

This is in contrast to undue influence where lifetime gifts and contracts are concerned, as here there are a number of presumptions. The main presumption is the existence of a ‘relationship of influence’ between certain parties, which may give cause for the gift to be explained. Where there is a presumption of a relationship of influence, there may not necessarily have been any undue influence. There is a presumption of a relationship of influence where a gift is made by:

 a child to a parent or guardian

 a beneficiary to a trustee

 a client to a solicitor

 a patient to a doctor or other medical practitioner

 a follower to a spiritual leader

If there is a relationship of influence, the person alleging undue influence must also show that the gift calls for explanation.

The Law Commission believe that the current system of setting a gift aside due to undue influence is too narrow in comparison to proving undue influence with a lifetime gift. Two approaches are proposed for a doctrine of testamentary undue influence; a structured approach or a discretionary approach.

The structured approach would be based on the lifetime gifts rules and would be a two-limb test. Under this, a presumption of undue influence would be raised if:

 there exists a relationship of influence; and

 the gift calls for explanation

Relationship of influence would be presumed in respect of gifts to:

 a trustee

 a medical adviser

 a person who prepared the will for remuneration

 a professional carer

Page 6 of 6

For all other types of relationship there is no presumption and the fact a relationship of influence exists would need to be proven.

When considering if the gift calls for explanation, the court would consider two factors:

 the conduct of the beneficiary in relation to the making of the will; and

 the circumstances in which the will was made

There is also a suggestion that where a beneficiary was instrumental in the preparation of the Will there should be a presumption of undue influence.

Under the alternative discretionary approach, the court could instead presume undue influence if it were satisfied that it is just to do so in all the circumstances of the case. This approach would still consider relationships of influence and calls for explanation, but they would only need to consider them alongside the general facts of the case instead of having to be individually satisfied of the two criteria as under the structural approach.

Under either approach, if the presumption is raised it would be up to the person defending the gift to rebut the presumption.

CONCLUSION

This paper has been by no means a full summary of the Law Commissions proposed reforms to the law surrounding Will Writing, only an examination of some of the key proposals. We would urge Members to read the full report or the official summary by following the links provided below.

The full Law Commission Consultation Paper No 231 and summary can be read by following this link: [huge_it_slider id=”1″]

The consultation is open to responses until 10 November 2017.

 

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Business Lasting Power of Attorney (LPA)

BY: Paul / 0 COMMENTS / CATEGORIES: News

An absolute essential for every Sole Owner, Director or Partner of a business in 2017

As a business owner it is important to consider what might happen to the business if you should be incapacitated by illness or injury, who would take over the running of the business and its financial and property affairs, and what would it mean for your employees’ financial future

Whilst there may be ‘an understanding’ amongst your colleagues of what would happen should illness or injury take you away from the business, in the eyes of the law this isn’t sufficient. Unless you have appointed an attorney, fundamental business operations may not be possible – access to bank accounts may be denied, suppliers won’t get paid, contracts could be compromised or lost, insurance premiums won’t be renewed, and salaries could go unpaid. Without an attorney appointed to take care of the business, the disruption to your company could be catastrophic, and it won’t take long for the impact to be felt.

As a business owner, you matter. You commit time and money to your business and have staff and suppliers who are reliant upon you.

Business owners may have had the foresight to purchase Key Person Insurance, but this will not assist with the practicalities of running the business if that key person is ill or injured and unable to work or take decisions. For that reason, LPAs are frequently being used by prudent business owners to protect their business interests in the event they become incapacitated (it is becoming common for people to make a specific LPA for business purposes and one for personal affairs).

If a person does not make an LPA and loses mental capacity, an application to the Court of Protection is required to access their finances which often is expensive and time-consuming. In a commercial sense, this may also hold-up the running of the business (cheque signing, payment of wages, renewals of insurance etc.).

Worryingly, many financial institutions respond to a business owner’s lack of capacity by calling-in loans and freezing bank accounts. By having an LPA in place for your business interests you can ensure that your company runs smoothly even when you are unavailable.

It is therefore a necessity for any business owner to consider the worst to ensure continuity and to protect hard earned success. A professionally drafted Business LPA is as important to your business as insurance is.

Each type of business must be assessed according to its structure. For sole traders, the owner can execute an LPA to appoint any attorney to act in the event of mental incapacity.

LPAs use in partnerships depends on whether there is a partnership agreement which allows for an attorney to act on behalf of an incapacitated partner. Where no such agreement exists an application to court may be needed to remove a partner who is incapable of adhering to the partnership terms.

For companies, Directors cannot delegate their functions as a Director unless the articles specifically provide otherwise. In many cases the Director will also own shares in the company. Therefore a solution is for the owner of the shares to have an LPA to ensure business continuity by the attorneys who can appoint a new Director in the event of the Donor’s incapacity. The LPA and the articles of association need to work alongside one another.

The benefit of a business LPA is that you decide on who will deal with your affairs on your behalf. You can also place very specific instructions and restrictions upon your attorneys as well as providing guidance on how they should deal with your business affairs.

This can all sound daunting but under the Mental Capacity Act 2005 your attorneys must act in your best interests and follow a Code of Practice, this includes considering any views and beliefs you have expressed in the past. You can also revoke your LPA at any time as long as you have capacity.

As a busy professional it is easy to brush these matters aside but as a business owner you have additional responsibilities to consider and a business LPA can give you, your partners, staff and suppliers the peace of mind that your hard earned success is protected at the worst time.

Contact us for more information 01325324515 or07971957945

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Wedding Will

BY: Paul / 0 COMMENTS / CATEGORIES: News, Will Writing

Weddings are wonderful and it is most certainly one of life’s main events and can be a complicated affair, just the planning of them causes couples to have some very serious conversation’s together and with both sides of the families.

Some issues often discussed:

  • How many Bridesmaids
  • Who sits next to old uncle or Auntie and spend all day assisting them
  • No kids’ policy?
  • Does the member of the family no one speaks to (family black sheep) really have to be invited?
  • Is he really going to be best man?

Yet all these questions being relevant the most important question is often never discussed and is one really important question which should be talked about before a couple get married but often isn’t: the question of what happens when one of them dies.

 

Couples usually spend the pre-wedding period surfing on a wave of optimism and looking forward to a life of wedded bliss and of course marriage is about a new beginning.

Who wants to think about their future husband or wife dying and put the mockers on the whole day, and yet it is of the utmost importance to consider this question.

Sadly, for some couples a tragic event end the happy ever after take Kirsty Maxwell who fell from a 10th floor whilst on a friend’s hens party in Benidorm and who had just been married 7 months earlier a complete accident no one could have predicted.

 

Unfortunately, random events like this do sometimes occur early on in a marriage and when they do the remaining partner is left having to deal with a newly created joint estate. This is never a pleasant task but if couples have never discussed how they would like their assets to be distributed then it is infinitely more difficult and distressing.

 

As morbid as it may seem, if you are getting married, while you are planning your exciting future together you need to ensure that future includes a plan for what happens when one of you inevitably dies. Hopefully that will be far in the future after you’ve celebrated your golden wedding anniversary but none of us can ever know.

 

Getting married automatically invalidates any pre-existing wills and in the absence of a new will, an estate is subject to intestacy laws. It is possible for fiancés to make a will declaring that it is made in anticipation of an upcoming marriage and that it should not be invalidated once the marriage has taken place and you should consider doing this.

 

 

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Welcome to our new website

BY: Paul / 0 COMMENTS / CATEGORIES: News

Welcome to our new web site, I hope you find it informative and helpful please contact us if you would like further details of our services

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