Court protects woman’s finances from spendthrift husband

Thousands of people set up lasting powers of attorney (LPA) each year to protect their interests in case they lose mental capacity later in life.

LPAs work by enabling you to appoint someone you trust to be your deputy and make decisions on your behalf should you ever lose the ability to manage your affairs. The growing problem of dementia as the population ages makes LPAs more important than ever.

The vast majority of LPAs work perfectly well without any hitches. However, problems can sometimes arise and in those circumstances, the Public Guardian and the Court of Protection can step in to ensure the LPA is not abused.

A recent case illustrates how this works. It involved a woman who set up an LPA and named her husband as her deputy to manage her finances for her if she became unable to do so herself.

The woman, who cannot be identified for legal reasons, later developed alcoholism and by the time she was in her 70s, she was unable to cope so her husband started managing her financial affairs.

However the husband, who was by then in his late 70s, became infatuated with a woman aged 42.

He used some of his wife’s money to lavish gifts on his new lover and to buy her a flat.

The Public Guardian, who looks after the interests of vulnerable people, stepped in and applied to the Court of Protection to have the husband’s power of attorney revoked.

The judge described the woman as “the principal villain of the piece” and ruled that the husband could no longer retain control of his wife’s finances. Instead, the wife’s sister and daughter were appointed to replace the husband as the wife’s lawful deputies.

Judge Denzil Lush said: “By his own admission, he has breached his fiduciary duty and taken advantage of his position as attorney by using his wife’s money to pay off his debts and to replenish his account.

“Having regard to all the circumstances, I am satisfied that the husband is unsuitable to be his wife’s attorney.

“By appointing deputies there is an obvious shift in the balance of power which is necessary for two reasons: to ensure that the wife’s affairs are managed in her best interests and to ensure that any decisions regarding her affairs are free from the influence that his lady friend exerts over the husband.”

Lasting powers of attorney are very rarely abused by family members but, as this case illustrates, on the rare occasions when something does go wrong, the Public Guardian and the Court of Protection can act to put things right.

Please contact Nicki Denton-Masih if you would like more information about lasting powers of attorney or the Court of Protection.