Can an Attorney or Deputy transfer the ownership of the Donor’s property into their own name?

A recent case which became before the Court involved a transaction made by a daughter whilst acting under a registered Lasting Power of Attorney (“LPA”) made by her 91 year old Mother.  The daughter had transferred the Mother’s property from her Mother’s name into their joint names.

The England and Wales High Court (EWHC) voided the transaction as agreed with the woman’s son (who was the Executor of his late Mother’s estate) that the transfer was unauthorised under s.12 of the Mental Capacity Act 2005.

This Act restricted gifts of the Mother’s property to include customary occasions (such as birthdays, weddings, anniversaries) and to an amount reasonable in the context of the size of her overall estate unless this had been authorised, in advance, by the England and Wales Court of Protection.

The transfer of the property into joint names was effectively a gift of the Donor’s interest in a half share of the property and needed authorisation and agreement of the transfer, by the Mother, prior to the Land Registry application.

Interestingly in this case of Chandler –v- Lombardi 2022 (EWHC 22 CH) the EWHC did not take into account the Mother’s mental capacity at the time of the transfer as the Attorney had executed this transfer herself

Attorneys, and Court of Protection Deputies, might not be aware that gifts which fall outside the scope of gifting need to be approved by the Court of Protection prior to the gift being made but, if the gift is made without necessary authority this could lead to the Attorney or Deputy being removed or asked to pay any money or gifts back so this is something which should be considered very carefully as the Court are also able to exercise discretion and direct that costs involved are paid by the Attorney or Deputy in order not to deplete the Donor’s own funds.

It is therefore very important that Attorneys and Deputies are aware of this and, if in doubt, then Attorneys or Deputies should take appropriate legal advice and our experienced Court of Protection team at Ellis Jones are happy to assist with this. Please contact the team on 01202 525333.