It is recommended that a Will should be reviewed every five years to ensure that its contents properly reflect the true wishes and instructions of the person making the Will. Yet, often with age comes decreased mental capacity. Solicitor Jim Grogan gives some practical advice on how to prepare a Will for such circumstance. 

by Jim Grogan

All Members of GSRMA (without wishing to be considered ageist), may be considering a responsible review of their current family situation in the event of an unexpected health issue arising. In particular, they may wish to review any Wills previously made some, or many, years ago, or indeed may not until now have contemplated such a scenario.

It is often said in jest that “where there is a Will there is a relation”. It is very much a truism that should not be lightly disregarded and it is highly recommended that a Will should (on average) be reviewed every five years to ensure that its content properly reflects the true current position of the testator’s (the Will-maker) wishes and instructions, taking account of any changes in life’s circumstances that may have occurred in the interim period.

If a person has not made a Will and dies he/she are said to have died ‘intestate’, not having made a Will providing for their loved ones or disposing of their property in a clean transparent manner.

Issues which commonly arise within the family relationship dynamic include marriage, birth, death, or illness of varying life changing degrees. These factors may require a fresh approach so as to protect and care for family members’ future needs.

It is also strongly recommended that you consider your overall personal and family situation, taking full account of assets and liabilities including any outstanding loans/debts which are not already covered by a loan insurance protection policy. Also it’s important to consider your Will from a tax efficient point of view so as to minimise, where possible, any death duty called inheritance tax that may be due on the death of the testator.

Enduring powers of attorney

Most people in this jurisdiction, up to recent times, only gave consideration to making a Will. However, with more people now living longer lives there is a great risk of mental health-capacity related issues arising. Dementia or loss of one’s capacity to look after every-day affairs will grow exponentially over the immediate years. It is therefore strongly advised that members should give very serious consideration to putting in place a legally binding instruction in a document called an Enduring Power of Attorney.

This area of law is currently governed by the Enduring Powers of Attorney Act 1996. It operates to provide for when the donor (or giver) of the power is (or is becoming) mentally incapable of managing his/her own every-day life affairs. This legislation will be with us 20 years in August 2016.

Most people do not know a lot about this area of law or how it works in practice, and, in particular, from a practical point of view how effective such power of attorney is once registered in the Wards of Court office of the High Court.

It is highly anticipated that the application and registration of EPAs are expected to grow over the next 10-15 years as a result.

Why complete an EPA?

An EPA provides a mechanism to manage the assets and affairs of a person who lacks capacity (and is often vulnerable) with a view to financing their proper care during what is a very difficult time for the maker (donor) of the EPA and their families. Properly advised, the donor can, when creating an EPA, determine the scope and extent of the authority given to the attorney. In addition to the management of the donors assets/affairs there are various options for personal care decisions which may be incorporated into the EPA.

To clarify, mental incapacity means that due to a mental condition the donor is incapable of managing and administering his or her own property and affairs. This doesn’t include debilitating illnesses such as strokes or other serious physical incapacities. This may cause practical problems where a person (e.g. someone who has had a stroke) can’t communicate but isn’t deemed to be suffering from a mental incapacity.

The making of an EPA should be strongly considered while you have full capacity and control over your assets and affairs. Sometimes (like a thief in the night) mental incapacity can creep up leaving you and your loved ones extremely vulnerable and not being in a position to properly and responsibly address healthcare and other important life issues. It is advisable and arguably best practice to consider making an EPA when making or reviewing your Will, particularly when getting older and in retirement.

Mental capacity

Regarding this matter, it’s important that you fully understand and appreciate that we are discussing not capacity in general but a specific kind of capacity and that once it is medically certified that you have lost your mental capacity to order and run your affairs independently, with an EPA you will pass over control of all your assets/affairs to your appointed attorney. The attorney will then be authorised to make all decisions on your behalf regarding your financial assets and possibly your personal care decisions but not healthcare/medical ones.

It is also an important to consider that when completing an EPA that you also review your current Will so that if your assets need to be sold during your incapacity this may directly affect specific bequests contained within the Will. Remember, a Will only operates or speaks from date of death and not before, so if you lose your capacity post making an EPA you may need to consider matters so as to cover (where possible) life changing events which may occur.

There are certain legal procedural issues in making an EPA, including the notification of its making to two people as follows; (a) spouse if living with donor, or, if this is not applicable (b) a child of the donor, or (c) a relative of the donor. None can be the attorney. Once signed by the donor, a medical doctor must then complete his certification as to the capacity of the donor. If the doctor is subsequently advised by a family member or the appointed attorney of a concern relating to the donors  mental incapacity he should visit the donor and be able to confirm and certify the position.

Upon death the attorney’s function ceases and a full inventory must be prepared with updated accounts by the attorney and passed to the legal personal representative/executor of the deceased donor.  I must point out that this is the current legal position in regard to Enduring Power of Attorney. There are changes to the law in this area contemplated by virtue of the Assisted Decision Making (Capacity) Act 2015 which will change the current law. But as I will discuss later, the 2015 Act is not yet operative and will not become operative for some time or until a ministerial order is made bringing it into force either together or in a piecemeal approach. It is anticipated that the Wards of Court Office will be abolished and be replaced by a new office and other executive functions. However, for now this and other expected, and much needed, changes are matters for the future.

Choosing of Attorney

To allow for the making of an informed decision it’s important that you (the donor) are aware that under current law when you lose mental capacity and the EPA is formally registered, your appointed chosen attorney actions are subject to little or no supervision. For this reason appointing two attorneys is, in general, safer than one. Consideration should be given as to whether or not they are to act jointly only or jointly and severally, as by default they are deemed to act jointly.

The Attorney’s Authority

If no restrictions are imposed the EPA may give general authority to do on behalf of the donor anything the donor can lawfully do without an attorney. You might wish to impose certain restrictions on the power of the attorney. For example, if you are concerned about the welfare of a spouse in relation to the family home, you may not wish to restrict the sale of it.

However, if it arises that the family home needs to be sold, and the EPA has not included the necessary power to sell/dispose of the home, this may frustrate the purpose of the EPA and trigger an application for “wardship”.

It is about finding a balance in making provision for the various family members into the future and for your own needs in the event of incapacity. The EPA can also give authority to attorney to make any specified personal care decisions (but not medical care) on your behalf with or without a proviso to consult certain specified persons as to your wishes and what would be in your best interests.

Assisted Decision Making

Signed into law on 30 December 2015, the Assisted Decision Making Act 2015 has not yet commenced but the required Ministerial Order is likely to be signed this year, in consultation with the Minister for Health.

In relation to this new Act and in particular regarding decision making, capacity is defined as;

1. The ability of the decision maker to understand the information at the time the decision is made.
2. The ability to retain that information long enough to make a voluntary choice.
3. The ability to use or weigh the information as part of the process of making that decision and to be able to communicate that decision.

In terms of assessing a person’s capacity to make a decision, the old or traditional way was a cognitive test called the mini mental state examination test (called an all or nothing test) regarding soundness of mind. Under this new intentioned regime there will be a functional test as to a person’s capacity being issue specific and time specific. Just because you do not have capacity for one particular task does not mean you have or lack it for the other matter.

The difference between this new and the older test system is that now you will be obliged to do everything to enhance the ability of the individual taking due account of the deficit in capacity so that where possible they can make a good decision.

Guiding principles are also enshrined in this new Act to safeguard the autonomy and dignity of the person with impaired capacity. There is a presumption in law the person has capacity unless shown to the contrary. No intervention is to occur unless or until all necessary and practical steps have taken place.

Three types of support the Act provides:

1. a) Assisted Decision Making.
2. b) Co-decision making.
3. c) Decision by a court or by a decision making representative appointed by a court.

Assisted decision making

Where a person considers their capacity is or may be in decline they can appoint a Decision Making Assistant (family member/carer) to help in accessing information or assist in making decisions about their welfare, property or affairs. The assistant will not make the final decision but will help/assist the person to make the decision in question at any one time.  Every facility is to be afforded the person whose capacity is/may be in question to maximise their ability. A formal agreement will be entered into in writing which can be revoked at any time by either party or changed once agreed by both parties.

Co-Decision making

Where a person considers their capacity is or may be in decline they can appoint a person to jointly make with them one or more decisions about their welfare, property or affairs. The new legislation speaks of a suitable co-decision maker as being somebody who is a relative or friend with whom the person has built up a trust over time and who can carry out the role as suggested. The point here is that the decision(s) must be made jointly rather than assistant alone.

The appointed person will obtain all necessary information and explain all alternatives relevant to the decision to be made jointly so as to enhance the ability and dignity of the affected individual. This agreement must be signed and witnessed by two people in like manner as a Will. It must be registered within five weeks of its execution with the Director of the Decision Support Service. No pay is allowed to the co-decision maker except for properly-vouched and reasonable expenses. Notice of intention to register the agreement must be given to certain parties like an EPA.

Decision Making Representative

In this case an application may be made to Court to appoint this representative where it’s thought the court should appoint somebody else to the role, called a court friend. If no suitable court friend is available then the Director of the Support Service can be asked to nominate someone from the panel. The court will first assess the capacity of the person and if decided capacity is lacking it may declare by Order that a co-decision maker should be appointed or a decision making representative whose function will be to acquire the wishes if possible of the relevant or affected person.

Advance Healthcare Directive

What is it? It is an expression made by a person with capacity which contains their will and preferences relating to medical treatment decisions that may arise if the person were to subsequently lose that capacity or be unable to express that preference (if they were in a coma, for example). It can be a stand- alone Directive or a person may appoint a Designated Healthcare Representative to exercise such powers as are conferred by the person under the Directive.

The AHD relates to a specific refusal of treatment and is as effective as if made at the time by a person with capacity. A person, 18 or over, with capacity can refuse treatment for any reason even if it were to result in death.

It will be valid if the person lacks capacity at the time of the treatment where the treatment is identifiable within the AHD, the circumstances in which the refusal takes place is identified in AHD.

The AHD may specify a request for certain type of treatment in certain circumstances but this isn’t legally binding and the doctor must confirm the reasons for non- compliance with the request. The AHD must be in writing and signed by both parties to it (if a Designated Healthcare Rep is being appointed) and witnessed by two people. A person with capacity can revoke or alter an AHD in writing duly witnessed by 2 people.

I hope this update will offer some guidance and be of probative assistance to the GSRMA and its members. I am available at any time to assist members in any way to create a Will or EPA or for any estate planning advice (including tax inheritance) to ensure their needs are responsibly met.

For further information email groganlaw@gmail.com or visit www.jimgrogansolicitors.ie
Tel: 021 4270840; Mob: 087 9066568; Fax: 021 4270825

 

Jim Grogan is a solicitor and trust estate practitioner, as well as a GSRMA member. He is also a full member of the Society of Trust Estate Practitioners. His office is located at 27 Cook Street, Cork.