Case digest

Public law

Acting in the best interests of a mentally impaired adult who did not fall within the Mental Health Act 1983 definition of mental impairment.
A LONDON BOROUGH v (1) MR B S (2) S (An adult by her Litigation Friend THE OFFICIAL SOLICITOR) (2003)
[2003] EWHC 1909 (Fam), FAM (Wall J) 31/7/2003

The case concerned a women aged 33 (Miss S) who had moderate/ severe learning disability. She also had atypical (some symptoms) autism and epilepsy. A consultant psychiatrist (Dr C) provided evidence that Miss S had a mental impairment. She had significant sub-average functioning and poor social-economic skills. She had a poor attention span and her level of comprehension and cognitive function was limited. Her understanding of events was dependent on contextual and situational cues and was unable to recall past events. She was unable to express her views or comprehend and retain any information material to her future. She was unable to make an evaluation of facts to be able to make a choice. In short, she did not have the capacity to decide where she should live and who should look after her.

S’s mother died in April 1995 and since then her father (Mr S) had been Miss S’s sole carer. On 9 November 2002, Mr S was alleged to have struck Miss S, which led to the local authority instituting adult protection measures and then making a without notice application to the court on 20 December 2002. Johnson J, exercising the court’s inherent jurisdiction, made interim declarations rendering it lawful for the local authority to (1) place Miss S in a residential placement for adults with learning disabilities; (2) to prohibit Mr S from removing her from that placement and (3) limiting contact between Miss S and Mr S to supervised contact.

On 15 January 2003 Hughes J continued the interim declarations and ordered that the official solicitor be appointed as Miss S’s litigation friend; a medical report be obtained by Dr C and an independent social work report be obtained to advise as to Miss S’s best interest in respect of where she lives and whether she should have contact with her father. The local authority sought declarations that: (i) Miss S lacked the capacity to decide where she should live and who should provide her with care; (ii) it was lawful as being in her best interests for her to reside at accommodation arranged for her by the local authority; (iii) that Miss S lacked the capacity to decide whether to have contact with her father; and (iv) it was in her best interests for contact with her father to be agreed with the local authority.

HELD:

This case was an example of a local authority inviting the High Court to exercise its inherent jurisdiction to determine the best interests of mentally impaired adults. This followed the identification of a gap in the mental-health legislation by the Court of Appeal in Re F (Adults: Court’s Jurisdiction) [2000] 2 FLR 512 (and known as Re F (No.2).)
S did not fall within the definition of mental impairment in s.1 (2) Mental Health Act 1983 and qualify for guardianship because mental impairment is defined by the Act as: “A state of arrested or incomplete development of mind (not amounting to mental impairment), which includes significant impairment of intelligence and social functioning and is associated with abnormally aggressive or seriously irresponsible conduct on the part of the person concerned.”
Unlike care proceedings under the Children Act 1989, the exercise of the jurisdiction over mentally incapable adults was not dependent upon any threshold criteria apart from the fact of incapacity. The court was quite satisfied that the instant case fell within the principles set out in Re F (No 2) (supra) that there was “a serious justiciable issue”, which required the court’s adjudication.
The welfare of the mentally disabled person was paramount. Although the facts, which gave rise to Miss S being taken into care, were disputed, the question the court needed to address was which outcome would best serve Miss S’s interests. The court decided that question by drawing up the balance sheet identified by Thorpe LJ in Re A (Medical Treatment: Male Sterilisation) [200] 1 FLR 549.
There had to be good reason for local authority intervention in a case such as the present. In each case, the four essential building blocks were: (a) was mental incapacity established; (b) was there a serious justiciable issue relating to welfare; (c) what was it; and (d) with the welfare of the incapable adult as the court’s paramount consideration, what were the relevant balance-sheet factors.
In this context professional evidence was crucial. Both the jointly instructed consultant psychiatrist and the independent social worker concluded that the local authority’s proposals met Miss S’s needs better than returning to her father’s care. The court agreed with that analysis. Viewed from Miss S’s perspective, her best interests required the declarations sought by the local authority to be made.

The court did not find that Mr S had struck Miss S as alleged and hoped that it was possible for a partnership to be developed between Mr S and the local authority for his daughter’s care.

Public law case digest compiled by Caroline Bielanska, a solicitor, TEP and freelance consultant. She can be contacted at: caroline.bielanska@ntlworld.com.

Private law

Curnock (personal representative of Curnock, deceased) v IRC (Re SpC 265, FTI23 2003 – 15 May 2003)
A cheque uncleared before death was a failed gift and not a debt on the deceased’s estate for inheritance-tax purposes.

On 21 December 2001, the attorney for the deceased under an EPA, drew a cheque for £6,000 in favour of the attorney’s son by way of gift, intended to use the annual exemption for that year and the previous year. On the same date, the attorney paid in
the cheque on behalf of his son but on the following day the deceased died. The deceased’s bank agreed to pay the cheque but it was only cleared five days after the date of death. The Revenue issued a notice of determination, which stated that the intended gift had failed as a result of the death of the deceased before the cheque had been cleared by the bank and that the £6,000 was an asset of the estate of the deceased immediately before his death for the purposes of inheritance tax. The appellant appealed on the grounds that:

There was a completed gift before the date of death;
If not, the cheque was a debt of the estate;
If not, the Revenue should have made a concession.

The Revenue contended that there was no completed gift and additionally that the cheque was not a debt in the estate as it was not a liability incurred for consideration in money or monies worth under Section 5(5) IHTA 1984. The Revenue also rejected the argument that this was a donatio mortis causa.

The special commissioners held, following 1926 and 1949 cases, that the cheque was no more than an order to deliver money and if not acted upon in the lifetime of the person who gives the order, was worth nothing. As the cheque was not cleared before the death of the deceased, it could not be a completed gift, which would require a cleared cheque. Although the bank agreed to pay the cheque after the death of the deceased, this was an act in the administration of the estate. The balance in the bank account before the £6,000 vested in the personal representatives on the death of the deceased and it was that balance that was liable to inheritance tax. This was not a donatio mortis causa and, therefore, cases on this were not relevant.

Additionally, the cheque did not create a debt in the estate for inheritance-tax purposes as Section 5(5) IHTA 1984 required that the liability incurred by the transferor should be taken into account only to the extent that it was incurred for consideration in money or monies worth, which was not the case here.

Chappell v Somers & Blake (A Firm) – judgment 8 July 2003 (The Times, 2 September 2003).

It was not correct for solicitors who failed to administer an estate to escape liability for damages simply because there was a difference between the person who instructed them and could claim against them for breach of duty (the executrix) and the beneficiary who had suffered the alleged damage.

The claimant was the sole executrix of the will under which residue was left to a parochial church council. The residue included two properties. The executrix instructed Somers & Blake in 1996 to act on her behalf to administer the estate. She terminated that instruction in 2001 and claimed against Somers & Blake alleging they did nothing at all regarding the administration of the estate during the time they were instructed. As a result, the executrix claimed that the estate had been deprived of income from the properties (either rental income or from proceeds of sale). The judge refused Somers & Blake’s application to strike out the action and they appealed.

Mr Justice Neuberger held that it would be wrong, as a matter of general policy, for solicitors to escape liability for damages simply because there was a difference in legal personality between an executrix (who was entitled to claim against them for breach of duty) and the parochial church council (who as a residuary beneficiary suffered the alleged loss of income from the properties). Further, it was right to treat the executrix as representing the interests of the owner of the properties and, therefore, the person entitled to recover damages. The properties were vested in the executrix during the relevant time and she would also be accountable to the parochial church council for any damages received in respect of the loss. The executrix was, therefore, entitled to maintain a cause of action for damages for loss of income from the properties. Appeal dismissed.

Private law case digest compiled by Julia Abrey, a partner at Withers LLP.
She can be contacted at: julia.abrey@withersworldwide.com.