Mental Capacity Bill

House of Commons

Session 2004 - 05
Internet Publications
Other Bills before Parliament

Mental Capacity Bill

Mental Capacity Bill
Part 1 — Persons who lack capacity
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Lasting powers of attorney
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Lasting powers of attorney
(1)
A lasting power of attorney is a power of attorney under which the donor (“P”)
confers on the donee (or donees) authority to make decisions about all or any
of the following—
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(a)
P’s personal welfare or specified matters concerning P’s personal
welfare, and
(b)
P’s property and affairs or specified matters concerning P’s property
and affairs,

and which includes authority to make such decisions in circumstances where
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P no longer has capacity.
(2)
A lasting power of attorney is not created unless—
(a)
section 10 is complied with,
(b)
an instrument conferring authority of the kind mentioned in subsection
(1) is made and registered in accordance with Schedule 1, and
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(c)
at the time when P executes the instrument, P has reached 18 and has
capacity to execute it.
(3)
An instrument which—
(a)
purports to create a lasting power of attorney, but
(b)
does not comply with this section, section 10 or Schedule 1,
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confers no authority.
(4)
The authority conferred by a lasting power of attorney is subject to—
(a)
the provisions of this Act and, in particular, section 4 (best interests),
and
(b)
any conditions or restrictions specified in the instrument.
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Appointment of donees
(1)
A donee of a lasting power of attorney must be—
(a)
an individual who has reached 18, or
(b)
if the power relates only to P’s property and affairs, either such an
individual or a trust corporation.
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(2)
An individual who is bankrupt may not be appointed as donee of a lasting
power of attorney in relation to P’s property and affairs.
(3)
Subsections (4) to (7) apply in relation to an instrument under which two or
more persons are to act as donees of a lasting power of attorney.
(4)
The instrument may appoint them to act—
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(a)
jointly, or
(b)
jointly and severally.
(5)
If it does not specify whether they are to act jointly or jointly and severally, the
instrument is to be assumed to appoint them to act jointly.
(6)
If they are to act jointly, a failure, as respects one of them, to comply with the
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requirements of subsection (1) or (2) or Part 1 or 2 of Schedule 1 prevents a
lasting power of attorney from being created.

Mental Capacity Bill
Part 1 — Persons who lack capacity
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(7)
If they are to act jointly and severally, a failure, as respects one of them, to
comply with the requirements of subsection (1) or (2) or Part 1 or 2 of Schedule
1—
(a)
prevents the appointment taking effect in his case, but
(b)
does not prevent a lasting power of attorney from being created in the
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case of the other or others.
(8)
An instrument used to create a lasting power of attorney—
(a)
cannot give the donee (or, if more than one, any of them) power to
appoint a substitute or successor, but
(b)
may itself appoint a person to replace the donee (or, if more than one,
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any of them) on the occurrence of an event mentioned in section
13(6)(a) to (d) which has the effect of terminating the donee’s
appointment.
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Lasting powers of attorney: restrictions
(1)
A lasting power of attorney does not authorise the donee (or, if more than one,
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any of them) to do an act that is intended to restrain P, unless three conditions
are satisfied.
(2)
The first condition is that P lacks, or the donee reasonably believes that P lacks,
capacity in relation to the matter in question.
(3)
The second is that the donee reasonably believes that it is necessary to do the
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act in order to prevent harm to P.
(4)
The third is that the act is a proportionate response to—
(a)
the likelihood of P’s suffering harm, and
(b)
the seriousness of that harm.
(5)
For the purposes of this section, the donee restrains P if he—
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(a)
uses, or threatens to use, force to secure the doing of an act which P
resists, or
(b)
restricts P’s liberty of movement, whether or not P resists,

or if he authorises another person to do any of those things.
(6)
Where a lasting power of attorney authorises the donee (or, if more than one,
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any of them) to make decisions about P’s personal welfare, the authority—
(a)
does not extend to making such decisions in circumstances other than
those where P lacks, or the donee reasonably believes that P lacks,
capacity,
(b)
is subject to sections 24 to 26 (advance decisions to refuse treatment),
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and
(c)
extends to giving or refusing consent to the carrying out or
continuation of a treatment by a person providing health care for P.
(7)
But subsection (6)(c)—
(a)
does not authorise the giving or refusing of consent to the carrying out
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or continuation of life-sustaining treatment, unless the instrument
contains express provision to that effect, and
(b)
is subject to any conditions or restrictions in the instrument.

Mental Capacity Bill
Part 1 — Persons who lack capacity
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Scope of lasting powers of attorney: gifts
(1)
Where a lasting power of attorney confers authority to make decisions about
P’s property and affairs, it does not authorise a donee (or, if more than one, any
of them) to dispose of the donor’s property by making gifts except to the extent
permitted by subsection (2).
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(2)
The donee may make gifts—
(a)
on customary occasions to persons (including himself) who are related
to or connected with the donor, or
(b)
to any charity to whom the donor made or might have been expected
to make gifts,
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if the value of each such gift is not unreasonable having regard to all the
circumstances and, in particular, the size of the donor’s estate.
(3)
“Customary occasion” means—
(a)
the occasion or anniversary of a birth, marriage or the formation of a
civil partnership, or
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(b)
any other occasion on which presents are customarily given within
families or among friends or associates.
(4)
Subsection (2) is subject to any conditions or restrictions in the instrument.
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Revocation of lasting powers of attorney etc.
(1)
This section applies if—
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(a)
P has executed an instrument with a view to creating a lasting power of
attorney, or
(b)
a lasting power of attorney is registered as having been conferred by P,

and in this section references to revoking the power include revoking the
instrument.
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(2)
P may, at any time when he has capacity to do so, revoke the power.
(3)
P’s bankruptcy revokes the power so far as it relates to P’s property and affairs.
(4)
But where P is bankrupt merely because an interim bankruptcy restrictions
order has effect in respect of him, the power is suspended, so far as it relates to
P’s property and affairs, for so long as the order has effect.
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(5)
The occurrence in relation to a donee of an event mentioned in subsection (6)—
(a)
terminates his appointment, and
(b)
except in the cases given in subsection (7), revokes the power.
(6)
The events are—
(a)
the disclaimer of the appointment by the donee in accordance with
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such requirements as may be prescribed for the purposes of this section
in regulations made by the Lord Chancellor;
(b)
subject to subsections (8) and (9), the death or bankruptcy of the donee
or, if the donee is a trust corporation, its winding-up or dissolution;
(c)
subject to subsection (11), the dissolution or annulment of a marriage,
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or civil partnership, between the donor and the donee;
(d)
the lack of capacity of the donee.
(7)
The cases are—
(a)
the donee is replaced under the terms of the instrument,

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Part 1 — Persons who lack capacity
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(b)
he is one of two or more persons appointed to act as donees jointly and
severally and, after the event, there is at least one remaining donee.
(8)
The bankruptcy of a donee does not terminate his appointment, or revoke the
power, in so far as his authority relates to P’s personal welfare.
(9)
Where the donee is bankrupt merely because an interim bankruptcy
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restrictions order has effect in respect of him, his appointment and the power
are suspended, so far as they relate to P’s property and affairs, for so long as
the order has effect.
(10)
Where the donee is one of two or more appointed to act jointly and severally
under the power, the reference in subsection (9) to the suspension of the power
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is to its suspension in so far as it relates to that donee.
(11)
The dissolution or annulment of a marriage or civil partnership does not
terminate the appointment of a donee, or revoke the power, if the instrument
provided that it was not to do so.
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Protection of donee and others if no power created or power revoked
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(1)
Subsections (2) and (3) apply if—
(a)
an instrument has been registered under Schedule 1 as a lasting power
of attorney, but
(b)
a lasting power of attorney was not created,

whether or not the registration has been cancelled at the time of the act or
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transaction in question.
(2)
A donee who acts in purported exercise of the power does not incur any
liability (to P or any other person) because of the non-existence of the power
unless at the time of acting he—
(a)
knows that a lasting power of attorney was not created, or
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(b)
is aware of events, facts or circumstances which, if a lasting power of
attorney had been created, would have terminated his authority to act
as a donee.
(3)
Any transaction between the donee and another person is, in favour of that
person, as valid as if the power had been in existence, unless at the time of the
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transaction that person has knowledge of a matter referred to in subsection (2).
(4)
If the interest of a purchaser depends on whether a transaction between the
donee and the other person was valid by virtue of subsection (3), it is
conclusively presumed in favour of the purchaser that the transaction was
valid if—
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(a)
the transaction was completed within 12 months of the date on which
the instrument was registered, or
(b)
the other person makes a statutory declaration, before or within 3
months after the completion of the purchase, that he had no reason at
the time of the transaction to doubt that the donee had authority to
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dispose of the property which was the subject of the transaction.
(5)
In its application to a lasting power of attorney which relates to matters in
addition to P’s property and affairs, section 5 of the Powers of Attorney Act
1971 (c. 27) (protection where power is revoked) has effect as if references to
revocation included the cessation of the power in relation to P’s property and
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affairs.

Mental Capacity Bill
Part 1 — Persons who lack capacity
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(6)
Where two or more donees are appointed under a lasting power of attorney,
this section applies as if references to the donee were to all or any of them.
General powers of the court and appointment of deputies
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Power to make declarations
(1)
The court may make declarations as to—
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(a)
whether a person has or lacks capacity to make a decision specified in
the declaration;
(b)
whether a person has or lacks capacity to make decisions on such
matters as are described in the declaration;
(c)
the lawfulness or otherwise of any act done, or yet to be done, in
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relation to that person.
(2)
“Act” includes an omission and a course of conduct.
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Powers to make decisions and appoint deputies: general
(1)
This section applies if a person (“P”) lacks capacity in relation to a matter or
matters concerning—
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(a)
P’s personal welfare, or
(b)
P’s property and affairs.
(2)
The court may—
(a)
by making an order, make the decision or decisions on P’s behalf in
relation to the matter or matters, or
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(b)
appoint a person (a “deputy”) to make decisions on P’s behalf in
relation to the matter or matters.
(3)
The powers of the court under this section are subject to the provisions of this
Act and, in particular, to section 4 (best interests).
(4)
When deciding whether it is in P’s best interests to appoint a deputy, the court
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must have regard (in addition to the matters mentioned in section 4) to the
principles that—
(a)
a decision by the court is to be preferred to the appointment of a deputy
to make a decision, and
(b)
the powers conferred on a deputy should be as limited in scope and
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duration as is reasonably practicable in the circumstances.
(5)
The court may make such further orders or give such directions, and confer on
a deputy such powers, as it thinks necessary or expedient for giving effect to
an order or appointment made by it under subsection (2).
(6)
Without prejudice to section 4, the court may make the order, give the
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directions or make the appointment on such terms as it considers are in P’s best
interests, even though no application is before the court for an order, directions
or an appointment on those terms.
(7)
An order of the court may be varied or discharged by a subsequent order.
(8)
The court may, in particular, revoke the appointment of a deputy or vary the
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powers conferred on him if it is satisfied that the deputy—

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Part 1 — Persons who lack capacity
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(a)
has behaved, or is behaving, in a way that contravenes the authority
conferred on him by the court or is not in P’s best interests, or
(b)
proposes to behave in a way that would contravene that authority or
would not be in P’s best interests.
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Section 16 powers: personal welfare
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(1)
The powers under section 16 as respects P’s personal welfare extend in
particular to—
(a)
deciding where P is to live;
(b)
deciding what contact, if any, P is to have with any specified persons;
(c)
making an order prohibiting a named person from having contact with
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P;
(d)
giving or refusing consent to the carrying out or continuation of a
treatment by a person providing health care for P;
(e)
giving a direction that a person responsible for P’s health care allow a
different person to take over that responsibility.
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(2)
Subsection (1) is subject to section 20 (restrictions on deputies).
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Section 16 powers: property and affairs
(1)
The powers under section 16 as respects P’s property and affairs extend in
particular to—
(a)
the control and management of P’s property;
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(b)
the sale, exchange, charging, gift or other disposition of P’s property;
(c)
the acquisition of property in P’s name or on P’s behalf;
(d)
the carrying on, on P’s behalf, of any profession, trade or business;
(e)
the taking of a decision which will have the effect of dissolving a
partnership of which P is a member;
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(f)
the carrying out of any contract entered into by P;
(g)
the discharge of P’s debts and of any of P’s obligations, whether legally
enforceable or not;
(h)
the settlement of any of P’s property, whether for P’s benefit or for the
benefit of others;
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(i)
the execution for P of a will;
(j)
the exercise of any power (including a power to consent) vested in P
whether beneficially or as trustee or otherwise;
(k)
the conduct of legal proceedings in P’s name or on P’s behalf.
(2)
No will may be made under subsection (1)(i) at a time when P has not reached
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18.
(3)
The powers under section 16 as respects any other matter relating to P’s
property and affairs may be exercised even though P has not reached 16, if the
court considers it likely that P will still lack capacity to make decisions in
respect of that matter when he reaches 18.
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(4)
Schedule 2 supplements the provisions of this section.
(5)
Section 16(7) (variation and discharge of court orders) is subject to paragraph
6 of Schedule 2.
(6)
Subsection (1) is subject to section 20 (restrictions on deputies).