Posted: Tuesday, 7 May 2024 @ 09:11
What is
the Law of Elderly Fraud?
If there was a Lasting Powers of Attorneys(LPA) you need to consider the obligations connected with the LPA
attorney who must:
- follow
any instructions the donor included in the LPA
- consider
any preferences the donor included in the LPA
- help the
donor make their own decisions as much as they can
- make any
decisions in the donor’s best interests
- respect
their human and civil rights.
The
general rule for deputies and attorneys about giving gifts is simple: apart
from some exceptions, the law says you must not make gifts from the person’s
estate.
For attorneys acting under a
registered property and financial affairs LPA, these exceptions are set out in
section 12(2) of the MCA 2005.
To count
as an exception, the gift must satisfy all three points below.
It
must be:
1. given
on a customary occasion for making gifts within families or among friends and
associates (for example, births, birthdays, weddings or civil partnerships,
Christmas, Eid, Diwali, Hanukkah and Chinese new year)
2. to
someone related or connected to the person or (if not a person) to a charity
the person supported or might have supported
3. of
reasonable value, taking into account the circumstances in each case and, in
particular, the size of the person’s estate.
The Law
of Presumed Undue Influence
One of
the key legal issues is there is a presumption of undue influence for lifetime
gifts where there is:
- a
relationship of trust and confidence is assumed in some incidences, namely that
between parent and child, solicitor and client, medical practitioner and
patient or trustee and beneficiary;
and
- a
transaction is of such a size or nature that it calls for an explanation.
Once
these requirements have been satisfied, the burden of proof shifts to the
person seeking to uphold the transaction to show that on the balance of probabilities
the transaction was entered in to by the influenced person independently and
free from influence.
If undue
influence is proved, then the transaction is declared void.
A presumption
of influence in certain categories of relationship, for reasons of public
policy, there is a legal presumption of influence (as opposed to
merely an evidential one).
A
significant gift made by an elderly and/or vulnerable individual, particularly
where that gift is substantial in the context of the individual’s other assets
is often a warning in these types of cases.
The law
presumes that the person in the dominant position may have taken advantage of
the other person’s vulnerability or dependence.(ascendancy)
The person claiming to be influenced does not need
to prove the undue influence; they merely need to prove the existence of the
relationship and that it was one of trust and confidence.