Mental Capacity Bill

House of Commons

Session 2002 - 03
Internet Publications
Other Bills before Parliament

Mental Capacity Bill

Mental Capacity Bill
Schedule 4 — Provisions applying to existing enduring powers of attorney
Part 3 — Notification prior to registration
54

(e)
the widow, widower or surviving civil partner of a child of the
donor,
(f)
the donor’s grandchildren,
(g)
the children of the donor’s brothers and sisters of the whole blood,
(h)
the children of the donor’s brothers and sisters of the half blood,
5
(i)
the donor’s uncles and aunts of the whole blood,
(j)
the children of the donor’s uncles and aunts of the whole blood.
      (2)
A person is not entitled to receive notice under paragraph 5 if—
(a)
his name or address is not known to the attorney and cannot be
reasonably ascertained by him, or
10
(b)
the attorney has reason to believe that he has not reached 18 or is
mentally incapable.
      (3)
Except where sub-paragraph (4) applies—
(a)
no more than 3 persons are entitled to receive notice under
paragraph 5, and
15
(b)
in determining the persons who are so entitled, persons falling
within the class in sub-paragraph (1)(a) are to be preferred to persons
falling within the class in sub-paragraph (1)(b), those falling within
the class in sub-paragraph (1)(b) are to be preferred to those falling
within the class in sub-paragraph (1)(c), and so on.
20
      (4)
Despite the limit of 3 specified in sub-paragraph (3), where—
(a)
there is more than one person falling within any of classes (a) to (j) of
sub-paragraph (1), and
(b)
at least one of those persons would be entitled to receive notice under
paragraph 5,
25

then, subject to sub-paragraph (2), all the persons falling within that class are
entitled to receive notice under paragraph 5.
7     (1)
An attorney is not required to give notice under paragraph 5—
(a)
to himself, or
(b)
to any other attorney under the power who is joining in making the
30
application,

even though he or, as the case may be, the other attorney is entitled to receive
notice by virtue of paragraph 6.
      (2)
In the case of any person who is entitled to receive notice by virtue of
paragraph 6, the attorney, before applying for registration, may make an
35
application to the court to be dispensed from the requirement to give him
notice; and the court must grant the application if it is satisfied—
(a)
that it would be undesirable or impracticable for the attorney to give
him notice, or
(b)
that no useful purpose is likely to be served by giving him notice.
40
Duty to give notice to donor
8     (1)
Subject to sub-paragraph (2), before making an application for registration
the attorney must give notice of his intention to do so to the donor.
      (2)
Paragraph 7(2) applies in relation to the donor as it applies in relation to a
person who is entitled to receive notice under paragraph 5.
45

Mental Capacity Bill
Schedule 4 — Provisions applying to existing enduring powers of attorney
Part 4 — Registration
55

Contents of notices
9
A notice to relatives under this Part of this Schedule must—
(a)
be in the prescribed form,
(b)
state that the attorney proposes to make an application to the Public
Guardian for the registration of the instrument creating the enduring
5
power in question,
(c)
inform the person to whom it is given of his right to object to the
registration under paragraph 13(4), and
(d)
specify, as the grounds on which an objection to registration may be
made, the grounds set out in paragraph 13(9).
10
10
A notice to the donor under this Part of this Schedule—
(a)
must be in the prescribed form,
(b)
must contain the statement mentioned in paragraph 9(b), and
(c)
must inform the donor that, while the instrument remains registered,
any revocation of the power by him will be ineffective unless and
15
until the revocation is confirmed by the court.
Duty to give notice to other attorneys
11    (1)
Subject to sub-paragraph (2), before making an application for registration
an attorney under a joint and several power must give notice of his intention
to do so to any other attorney under the power who is not joining in making
20
the application; and paragraphs 7(2) and 9 apply in relation to attorneys
entitled to receive notice by virtue of this paragraph as they apply in relation
to persons entitled to receive notice by virtue of paragraph 6.
      (2)
An attorney is not entitled to receive notice by virtue of this paragraph if—
(a)
his address is not known to the applying attorney and cannot
25
reasonably be ascertained by him, or
(b)
the applying attorney has reason to believe that he has not reached
18 or is mentally incapable.
Supplementary
12
Despite section 7 of the Interpretation Act 1978 (c. 30) (construction of
30
references to service by post), for the purposes of this Part of this Schedule a
notice given by post is to be regarded as given on the date on which it was
posted.
Part 4
Registration
35
Registration of instrument creating power
13    (1)
If an application is made in accordance with paragraph 4(3) and (4) the
Public Guardian must, subject to the provisions of this paragraph, register
the instrument to which the application relates.
      (2)
If it appears to the Public Guardian that—
40
(a)
there is a deputy appointed for the donor of the power created by the
instrument, and

Mental Capacity Bill
Schedule 4 — Provisions applying to existing enduring powers of attorney
Part 4 — Registration
56

(b)
the powers conferred on the deputy would, if the instrument were
registered, to any extent conflict with the powers conferred on the
attorney,

the Public Guardian must not register the instrument except in accordance
with the court’s directions.
5
      (3)
The court may, on the application of the attorney, direct the Public Guardian
to register an instrument even though notice has not been given as required
by paragraph 4(3) and Part 3 of this Schedule to a person entitled to receive
it, if the court is satisfied—
(a)
that it was undesirable or impracticable for the attorney to give
10
notice to that person, or
(b)
that no useful purpose is likely to be served by giving him notice.
      (4)
Sub-paragraph (5) applies if, before the end of the period of 5 weeks
beginning with the date (or the latest date) on which the attorney gave notice
under paragraph 5 of an application for registration, the Public Guardian
15
receives a valid notice of objection to the registration from a person entitled
to notice of the application.
      (5)
The Public Guardian must not register the instrument except in accordance
with the court’s directions.
      (6)
Sub-paragraph (7) applies if, in the case of an application for registration—
20
(a)
it appears from the application that there is no one to whom notice
has been given under paragraph 5, or
(b)
the Public Guardian has reason to believe that appropriate inquiries
might bring to light evidence on which he could be satisfied that one
of the grounds of objection set out in sub-paragraph (9) was
25
established.
      (7)
The Public Guardian—
(a)
must not register the instrument, and
(b)
must undertake such inquiries as he thinks appropriate in all the
circumstances.
30
      (8)
If, having complied with sub-paragraph (7)(b), the Public Guardian is
satisfied that one of the grounds of objection set out in sub-paragraph (9) is
established—
(a)
the attorney may apply to the court for directions, and
(b)
the Public Guardian must not register the instrument except in
35
accordance with the court’s directions.
      (9)
A notice of objection under this paragraph is valid if made on one or more
of the following grounds—
(a)
that the power purported to have been created by the instrument
was not valid as an enduring power of attorney,
40
(b)
that the power created by the instrument no longer subsists,
(c)
that the application is premature because the donor is not yet
becoming mentally incapable,
(d)
that fraud or undue pressure was used to induce the donor to create
the power,
45
(e)
that, having regard to all the circumstances and in particular the
attorney’s relationship to or connection with the donor, the attorney
is unsuitable to be the donor’s attorney.

Mental Capacity Bill
Schedule 4 — Provisions applying to existing enduring powers of attorney
Part 5 — Legal position after registration
57

     (10)
If any of those grounds is established to the satisfaction of the court it must
direct the Public Guardian not to register the instrument, but if not so
satisfied it must direct its registration.
     (11)
If the court directs the Public Guardian not to register an instrument because
it is satisfied that the ground in sub-paragraph (9)(d) or (e) is established, it
5
must by order revoke the power created by the instrument.
     (12)
If the court directs the Public Guardian not to register an instrument because
it is satisfied that any ground in sub-paragraph (9) except that in sub-
paragraph (9)(c) is established, the instrument must be delivered up to be
cancelled unless the court otherwise directs.
10
Register of enduring powers
14
The Public Guardian has the function of establishing and maintaining a
register of enduring powers for the purposes of this Schedule.
Part 5
Legal position after registration
15
Effect and proof of registration
15    (1)
The effect of the registration of an instrument under paragraph 13 is that—
(a)
no revocation of the power by the donor is valid unless and until the
court confirms the revocation under paragraph 16(3);
(b)
no disclaimer of the power is valid unless and until the attorney
20
gives notice of it to the Public Guardian;
(c)
the donor may not extend or restrict the scope of the authority
conferred by the instrument and no instruction or consent given by
him after registration, in the case of a consent, confers any right and,
in the case of an instruction, imposes or confers any obligation or
25
right on or creates any liability of the attorney or other persons
having notice of the instruction or consent.
      (2)
Sub-paragraph (1) applies for so long as the instrument is registered under
paragraph 13 whether or not the donor is for the time being mentally
incapable.
30
      (3)
A document purporting to be an office copy of an instrument registered
under this Schedule is, in any part of the United Kingdom, evidence of—
(a)
the contents of the instrument, and
(b)
the fact that it has been so registered.
      (4)
Sub-paragraph (3) is without prejudice to section 3 of the Powers of Attorney
35
Act 1971 (c. 27) (proof by certified copies) and to any other method of proof
authorised by law.
Functions of court with regard to registered power
16    (1)
Where an instrument has been registered under paragraph 13, the court has
the following functions with respect to the power and the donor of and the
40
attorney appointed to act under the power.
      (2)
The court may—
(a)
determine any question as to the meaning or effect of the instrument;

Mental Capacity Bill
Schedule 4 — Provisions applying to existing enduring powers of attorney
Part 5 — Legal position after registration
58

(b)
give directions with respect to—
(i)
the management or disposal by the attorney of the property
and affairs of the donor;
(ii)
the rendering of accounts by the attorney and the production
of the records kept by him for the purpose;
5
(iii)
the remuneration or expenses of the attorney whether or not
in default of or in accordance with any provision made by the
instrument, including directions for the repayment of
excessive or the payment of additional remuneration;
(c)
require the attorney to supply information or produce documents or
10
things in his possession as attorney;
(d)
give any consent or authorisation to act which the attorney would
have to obtain from a mentally capable donor;
(e)
authorise the attorney to act so as to benefit himself or other persons
than the donor otherwise than in accordance with paragraph 3(2)
15
and (3) (but subject to any conditions or restrictions contained in the
instrument);
(f)
relieve the attorney wholly or partly from any liability which he has
or may have incurred on account of a breach of his duties as attorney.
      (3)
On application made for the purpose by or on behalf of the donor, the court
20
must confirm the revocation of the power if satisfied that the donor—
(a)
has done whatever is necessary in law to effect an express revocation
of the power, and
(b)
was mentally capable of revoking a power of attorney when he did
so (whether or not he is so when the court considers the application).
25
      (4)
The court must direct the Public Guardian to cancel the registration of an
instrument registered under paragraph 13 in any of the following
circumstances—
(a)
on confirming the revocation of the power under sub-paragraph (3),
(b)
on directing under paragraph 2(9)(b) that the power is to be revoked,
30
(c)
on being satisfied that the donor is and is likely to remain mentally
capable,
(d)
on being satisfied that the power has expired or has been revoked by
the mental incapacity of the attorney,
(e)
on being satisfied that the power was not a valid and subsisting
35
enduring power when registration was effected,
(f)
on being satisfied that fraud or undue pressure was used to induce
the donor to create the power,
(g)
on being satisfied that, having regard to all the circumstances and in
particular the attorney’s relationship to or connection with the
40
donor, the attorney is unsuitable to be the donor’s attorney.
      (5)
If the court directs the Public Guardian to cancel the registration of an
instrument on being satisfied of the matters specified in sub-paragraph (4)(f)
or (g) it must by order revoke the power created by the instrument.
      (6)
If the court directs the cancellation of the registration of an instrument under
45
sub-paragraph (4) except paragraph (c) the instrument must be delivered up
to the Public Guardian to be cancelled, unless the court otherwise directs.

Mental Capacity Bill
Schedule 4 — Provisions applying to existing enduring powers of attorney
Part 6 — Protection of attorney and third parties
59

Cancellation of registration by Public Guardian
17
The Public Guardian must cancel the registration of an instrument creating
an enduring power of attorney—
(a)
on receipt of a disclaimer signed by the attorney;
(b)
if satisfied that the power has been revoked by the death or
5
bankruptcy of the donor or attorney or, if the attorney is a body
corporate, by its winding up or dissolution;
(c)
on receipt of notification from the court that the court has revoked
the power;
(d)
on confirmation from the court that the donor has revoked the
10
power.
Part 6
Protection of attorney and third parties
Protection of attorney and third persons where power is invalid or revoked
18    (1)
Sub-paragraphs (2) and (3) apply where an instrument which did not create
15
a valid power of attorney has been registered under paragraph 13 (whether
or not the registration has been cancelled at the time of the act or transaction
in question).
      (2)
An attorney who acts in pursuance of the power does not incur any liability
(either to the donor or to any other person) because of the non-existence of
20
the power unless at the time of acting he knows—
(a)
that the instrument did not create a valid enduring power,
(b)
that an event has occurred which, if the instrument had created a
valid enduring power, would have had the effect of revoking the
power, or
25
(c)
that, if the instrument had created a valid enduring power, the
power would have expired before that time.
      (3)
Any transaction between the attorney and another person is, in favour of
that person, as valid as if the power had then been in existence, unless at the
time of the transaction that person has knowledge of any of the matters
30
mentioned in sub-paragraph (2).
      (4)
If the interest of a purchaser depends on whether a transaction between the
attorney and another person was valid by virtue of sub-paragraph (3), it is
conclusively presumed in favour of the purchaser that the transaction was
valid if—
35
(a)
the transaction between that person and the attorney was completed
within 12 months of the date on which the instrument was
registered, or
(b)
that person makes a statutory declaration, before or within 3 months
after the completion of the purchase, that he had no reason at the
40
time of the transaction to doubt that the attorney had authority to
dispose of the property which was the subject of the transaction.
      (5)
For the purposes of section 5 of the Powers of Attorney Act 1971 (c. 27)
(protection where power is revoked) in its application to an enduring power
the revocation of which by the donor is by virtue of paragraph 15 invalid
45
unless and until confirmed by the court under paragraph 16—

Mental Capacity Bill
Schedule 4 — Provisions applying to existing enduring powers of attorney
Part 7 — Joint and joint and several attorneys
60

(a)
knowledge of the confirmation of the revocation is knowledge of the
revocation of the power, but
(b)
knowledge of the unconfirmed revocation is not.
Further protection of attorney and third persons
19    (1)
If—
5
(a)
an instrument framed in a form prescribed as mentioned in
paragraph 2(2) creates a power which is not a valid enduring power,
and
(b)
the power is revoked by the mental incapacity of the donor,

sub-paragraphs (2) and (3) apply, whether or not the instrument has been
10
registered.
      (2)
An attorney who acts in pursuance of the power does not, by reason of the
revocation, incur any liability (either to the donor or to any other person)
unless at the time of acting he knows—
(a)
that the instrument did not create a valid enduring power, and
15
(b)
that the donor has become mentally incapable.
      (3)
Any transaction between the attorney and another person is, in favour of
that person, as valid as if the power had then been in existence, unless at the
time of the transaction that person knows—
(a)
that the instrument did not create a valid enduring power, and
20
(b)
that the donor has become mentally incapable.
      (4)
Paragraph 18(4) applies for the purpose of determining whether a
transaction was valid by virtue of sub-paragraph (3) as it applies for the
purpose or determining whether a transaction was valid by virtue of
paragraph 18(3).
25
Part 7
Joint and joint and several attorneys
Application to joint and joint and several attorneys
20    (1)
An instrument which appoints more than one person to be an attorney
cannot create an enduring power unless the attorneys are appointed to act—
30
(a)
jointly, or
(b)
jointly and severally.
      (2)
This Schedule, in its application to joint attorneys, applies to them
collectively as it applies to a single attorney but subject to the modifications
specified in paragraph 21.
35
      (3)
This Schedule, in its application to joint and several attorneys, applies with
the modifications specified in sub-paragraphs (4) to (7) and in paragraph 22.
      (4)
A failure, as respects any one attorney, to comply with the requirements for
the creation of enduring powers—
(a)
prevents the instrument from creating such a power in his case, but
40
(b)
does not affect its efficacy for that purpose as respects the other or
others or its efficacy in his case for the purpose of creating a power
of attorney which is not an enduring power.