Various Lasting Powers of Attorney, Re [2019] EWCOP 40

Several applications were brought by the PG where the common theme across these applications was the expression by the donor, in the Lasting Power of Attorney, of an intention that the appointed attorney use the donor's funds to benefit someone other than the donor. ​

The PG brought the applications because it appeared to him that the provisions which expressed the donor's intention that the attorney(s) use the donor's funds to benefit someone other than the donor ("The Provisions") may be "ineffective as part of a lasting power of attorney" or may "prevent the instrument from operating as a valid lasting power of attorney.

Specifically, the Public Guardian asked the court to determine whether The Provisions are:
a) invalid, as purporting to authorise gifts in contravention to section 12 of the Act; or
b) valid, as instructing attorneys to provide for persons whom the donor has a legal obligation to maintain; or
c) valid.
Where the person intended to benefit from The Provisions is also the attorney, the Public Guardian further asked the court to determine if The Provisions are:
d) invalid, since attorneys owe fiduciary obligations which would normally preclude them from benefitting on the basis that this would give rise to a conflict; or
e) valid, because any conflict has necessarily been authorised by the donor and the attorney must in any event act in accordance with the donor's best interests.

The court ruled as follows:

a) No, provisions within an LPA that provide for attorneys to use the donor's funds to benefit persons other than the donor are not invalid as purporting to authorise gifts in contravention of section 12 of the Act, as long as they are not linked to a 'customary occasion' as defined by s12(3) of the Act;
b) No, provisions within an LPA that provide for attorneys to use the donor's funds to benefit persons other than the donor are not valid if and because they relate to provision for a person whom the donor has a legal obligation to maintain;
c) Yes, provisions within an LPA that provide for attorneys to use the donor's funds to benefit persons other than the donor may be valid as a written statement of the donor's wishes as long as they are expressed in precatory terms, but they would be ineffective as part of a lasting power of attorney if they were expressed in mandatory terms;
d) No, provisions within an LPA that provide for attorneys to use the donor's funds to benefit the attorney themselves, are not invalid because of fiduciary obligations;
e) Yes, provisions within an LPA that provide for attorneys to use the donor's funds to benefit the attorney themselves are valid because any conflict has been authorised by the donor and the attorney must in any event act in accordance with the donor's best interests.

​Read the full text of the judgment on Bailii