In the court case, two deputies were found to have made very large unauthorised gifts to themselves and others from their elderly aunt’s money. Auntie was a frail childless widow living in a residential care home in Derbyshire. In 2010, the court appointed her two nieces as her deputies. Their role was to manage their aunt’s savings because severe dementia prevented her from doing this herself. Her life savings came to about £500,000. In 2011, an official from the court made a routine visit to the nieces to check how they were getting on with managing the money, and this is what he found:- in less than a year, the nieces had given away over £277,000. They had given approximately £68,000 cash to family members, donated £57,000 to various charities, bought expensive Vivienne Westwood handbags and football season tickets for their grandchildren and treated themselves to jewellery, watches, perfume, cars, computers and designer handbags as well as large sums of cash. They appear to have thought this was entirely acceptable.
The court official recommended that the nieces apply to court for retrospective approval of the gifts, as they had not obtained the court’s approval in advance. In court, the women described the jewellery and watches as “heirlooms” acquired in their aunt’s memory, with the intention that they would be passed down through the family from generation to generation. The women explained that the reason they had bought a new car each from their aunt’s money was that they needed these to be able to visit their aunt. They claimed that they needed the new computers to be able to keep an eye on their aunt’s investments online.
There was no evidence of the extent to which Auntie had given presents to them and other family members in the past. However, she was said to have made occasional cash gifts which tended to be in the region of £20, and the court heard that she paid the entrance fees whenever they went somewhere on a day’s outing. Apparently, she once bought a fan heater for one of the niece’s grandchildren. Before she became too ill to manage her own finances, she set up a monthly direct debit for £20 payable to the National Deaf Children’s Society. Surprisingly, this was not one of the many charities to which the nieces made a substantial donation on her behalf. The nieces did not discuss any of their gift making proposals with their aunt.
After hearing all the evidence, the judge said:
“I do not accept that the gifts they made were in (Auntie)’s best interests. They are completely out of character with any gifts she made before the onset of dementia. There was no consultation with her before they were made and there was no attempt to permit and encourage her to participate in the decision-making process, or to ascertain her present wishes and feelings.
Nor do I accept the applicants’ argument that they believed that the order appointing them allowed them to make gifts on such an extensive scale. They should have been aware of the law regarding their role and responsibilities. Ignorance is no excuse.
The fact that (Auntie)’s remaining assets were in the names of one or other of the applicants, rather than in (Auntie)’s name, is a further example of what is, at best, ignorance, and, at worst, stealth.
I realise that (the two nieces) are the only visitors that (Auntie) receives, but this does not give them a licence to loot, and I was unimpressed by the veiled threat that, if the court were to remove them as deputies, they would find it difficult to continue seeing (Auntie).”
The court approved the donations to charity and £16,000 of the cash gifts to family members. The nieces were ordered to repay the rest of the money. The court revoked their appointment as deputies and recommended that an independent solicitor be appointed as deputy instead.
The court also took the opportunity to set out much-needed guidance on how to determine whether gifts are reasonable.