Brother's authority over 86-year-old sister's legal affairs rescinded by judge
In SINGAPORE, an elderly woman, aged 86, appointed her 90-year-old brother as the decision-maker in her Lasting Power of Attorney (LPA) due to her dementia diagnosis. However, the woman's 60-year-old son filed a court application to revoke the LPA, arguing that his mother lacked the mental capacity to sign it.
The underlying issue centers around the Mental Capacity Act, which sets out the requirements for individuals to have mental capacity while signing LPAs. The act states that an individual is deemed to have mental capacity if they can understand, retain, use, and communicate their decisions.
In the woman's case, a psychiatrist certified her competency, but a Family Justice Courts judge noted concerns about the woman's understanding of her estate's extent, her familiarity with the LPA contents, and the lack of consultation with her son before the documents were signed. Judge Shobha Nair deemed that the woman's capacity did not meet the necessary requirements, and the son's application was granted.
Persons with neurodegenerative diseases face increased vulnerability when signing LPAs. Judge Nair highlighted the LPA form section that relates to the donee's powers, which was not adequately explained by the assessing psychiatrist.
Additionally, questions arose about the woman's awareness of the statutory declaration's contents. She signed based on information her brother provided, raising concerns that she may have been taken advantage of.
The woman, a British national and Singapore permanent resident, has a vast estate, featuring multiple bank accounts, a substantial securities portfolio, and other assets. Unfortunately, her only child and brother, who both live abroad, are now embroiled in a dispute over the woman's management and ownership of these assets.
Furthermore, the woman's brother's nephew has been named as a successor donee, which the judge found puzzling, given that their relationship was not properly explained. As both men live abroad, it may be prudent to appoint a professional deputy to manage the woman's affairs.
To avoid similar situations, consider getting proper valuations of properties and ensuring that all parties are consulted before signing legal documents. Ensuring that LPAs are performed in an informed and transparent manner can help prevent financial exploitation by relatives.
In a related scenario, a 'divorcing' couple attempted to hide their $12 million from creditors, but their attempt failed due to legal restrictions on hiding assets. Likewise, a mother's $500,000 gift to help her children buy a home was ruled to be equally split in the divorce settlement. Both cases underline the importance of understanding and complying with legal requirements, especially when dealing with significant assets.
- In light of the complexities surrounding Lasting Power of Attorneys (LPAs), it might be beneficial to seek advice from professionals in areas such as science, health-and-wellness, and finance to ensure a comprehensive understanding of one's estate and the implications of LPAs.
- Given the increased vulnerability of individuals with neurodegenerative diseases when signing LPAs, it is crucial to adhere to the Mental Capacity Act's requirements and strive for transparency and fairness, ensuring all parties are consulted and that the contents of legal documents are adequately explained, avoiding potential financial exploitation.
