Solicitors’ duty of care – capacity – Thorpe v Fellowes Solicitors LLP [2011] EWHC 61

 In Wills

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A trainee solicitor was instructed to sell Mrs Hill’s property in a private sale for £145,000. Originally this was on the basis that her daughter would then join her in buying an alternative property. What onus is there on the solicitor’s firm to establish a person’s capacity to enter into contracts in such circumstances?

The recent case of Thorpe v Fellowes Solicitors LLP [2011] EWHC 61 provides some answers.

The facts

Mrs Hill’s son brought an action on behalf of his mother against Fellowes Solicitors LLP for professional negligence in connection with her sale of her property. His sister had contacted the firm in January 2003 to say her mother wished to sell her property.

In the process of acting for Mrs Hill the trainee solicitor who was allocated the job had written to her, spoken to her on the telephone and met with her face-to-face. An attendance note recorded that Mrs Hill “fully understood what was going on and was adamant that she wants to sell the property and purchase another property with her daughter so that she does not have to deal with any maintenance of the house”.

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Before the sale went through the trainee solicitor had written to Mrs Hill requesting confirmation that she was happy to proceed with the sale of the property at £145,000 even though she had decided to move into local authority housing. Mrs Hill sent in reply a handwritten letter confirming she wished to proceed and gave details of what she said was her Bank account to which she wanted the proceeds of sale paid.

The sale went through in October 2003 and the proceeds were remitted to the specified bank account. However, rather than being Mrs Hill’s account it was in fact her daughter’s account.

Within two months of the sale by Mrs Hill at £145,000 the property was sold on for £186,000.

Mrs Hill lived in local authority housing for two years following the sale before moving into residential care.

The claim

Mrs Hill’s son, on her behalf, claimed the firm was negligent because:

  1. It acted for her without proper instructions as Mrs Hill was suffering from dementi
  2. It allowed the property to be sold at an undervalue
  3. It remitted the proceeds of sale to the daughter’s account instead of to an account in Mrs Hill’s name.

The arguments

Expert evidence made it clear that whilst Mrs Hill had been suffering from a progressive form of dementia throughout 2003 this did not mean that she lacked capacity to instruct the firm in the sale nor that she lacked the ability to exercise free will or that she lacked capacity which would have been evident to a reasonably competent solicitor.

The decision

A solicitor was generally only required to make inquiries as to a person’s capacity to contract if there were circumstances such as to raise that doubt in the mind of a reasonably competent practitioner.

There is a presumption of capacity and only if that was called into question should a solicitor seek a doctor’s report with the client’s consent. There was no duty upon solicitors in general to obtain medical evidence on every occasion upon which they were instructed by an elderly client just in case they lacked capacity; such a requirement would be insulting and unnecessary.

There is no general duty upon a solicitor to advise a seller to obtain an independent valuation of a property and no evidence that it was sold at an undervalue. The simple fact it was subsequently sold for £41,000 more did not establish that it was originally sold at an undervalue.

There was no evidence that the remission of proceeds of sale to the daughter’s account was not in accordance with Mrs Hill’s wishes. There was no evidence she had been abused or to conclude that her daughter had ‘run off’ with her money.

Practice points

If the making of a lifetime gift of what was possibly the most significant asset in the donor’s estate does not impose the same duty of care on solicitors regarding the making of gifts under a Will this is surely odd to say the least.

Whilst I have no wish to impose the increasingly ludicrous ‘golden rule’ on to conveyancing practitioners, clarity as to a solicitor’s duty of care when acting on behalf of elderly clients is desperately needed.

The difficulties faced by the Will draftsman when preparing a Will are legion. As the recent case of Key v Key [2010] EWHC 408 identified, solicitor Will draftsmen are supposed to be experts in spotting sophisticated psychiatric disorders which should encourage the involvement of suitable medical practitioners yet apparently a convenyancing practitioner is only required to make inquiries if there were circumstances which might raise doubt in the mind of a reasonably competent practitioner. Indeed, apparently “there was plainly no duty upon solicitors in general to obtain medical evidence on every occasion upon which they were instructed by an elderly client just in case they lacked capacity; such a requirement would be insulting and unnecessary.”

Contrast this with the Golden Rule In Re Simpson (1977) 121 SOL JO 224, Templeman J. (as he then was) gave advice as to the best way to avoid disputes about testamentary capacity:

“… in the case of an aged testator or a testator who has suffered a serious illness, there is one golden rule which should always be observed, however straightforward matters may appear, and however difficult or tactless it may be to suggest that precautions be taken; the making of a Will by such a testator ought to be witnessed or approved by a medical practitioner who satisfied himself of the capacity and understanding of the testator, and records and preserves his examination and findings.

There are other precautions that should be taken. If the testator has made an earlier Will, this should be considered by the legal and medical advisors of the testator and, if appropriate, discussed with the testator. The instructions of the testator should be taken in the absence of anyone who may stand to benefit, or who may have influence over the testator.

These are no counsels of perfection. If proper precautions are not taken then injustice may result or be imagined, and great expense and misery may be unnecessarily caused.”

What is the solicitor to do?  Appeal to Government to set a sensible balance?  Ask the Law Commission to review and advise?  Watch this space ……..

© Gill Steel LawSkills Ltd

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