Whitney v National Australia Bank Ltd
[2007] QSC 397
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- Notable Unreported Decision
- Whitney v National Australia Bank Ltd[2007] QSC 397
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Whitney v National Australia Bank Ltd[2007] QSC 397
Whitney v National Australia Bank Ltd[2007] QSC 397
SUPREME COURT OF QUEENSLAND
CIVIL JURISDICTION
LYONS J
No BS11650 of 2007
TIMOTHY CLIFTON WHITNEY | Applicant |
and |
|
NATIONAL AUSTRALIA BANK LIMITED ABN 12 004 044 937 | Respondent |
BRISBANE
..DATE 21/12/2007
ORDER
HER HONOUR: This is an application by Timothy Whitney for declarations that on a proper construction of the Enduring Power of Attorney made by Mrs Shirley Murphy on the 17th of March 2003, and in view of the events which have occurred, the Enduring Power of Attorney may be exercised by the applicant and his co-attorney Ross Walker.
This application is brought pursuant to Sections 110 and 113 of the Powers of Attorney Act.
On the 17th of March 2003, Mrs Murphy made an Enduring Power of Attorney, and there is no question of her capacity to execute that document at that time. On the 16th of October 2007, the attorneys appointed by that document, namely Timothy Whitney and Ross Walker, signed that Enduring Power of Attorney accepting their appointment.
On the 20th of November 2007, the respondent bank, the National Australia Bank, notified the applicant that:
"The Bank was not prepared to rely upon the Power of Attorney because of the execution of the Power of Attorney. We note that the Power of Attorney has been signed by Ms Murphy in 2003 and this was not accepted by yourself or the other attorney until 2007. The Bank was aware that Ms Murphy had dementia prior to you signing the Power of Attorney. For this reason, the Bank considers that Ms Murphy did not have the capacity at the time you signed the Power of Attorney to grant a Power of Attorney."
It is clear that Ms Murphy lost capacity at sometime between 2003 and 2007 and did not have capacity on the 16th of October 2007.
The question that arises in this application is whether an attorney may accept an appointment under and exercise power pursuant to an Enduring Power of Attorney if the principal loses capacity between the date the enduring document is made and the date the attorney accepts the appointment. Clearly, in the circumstances, the answer to this question is in the affirmative.
Under Section 41(1) of the Powers of Attorney Act 1998, the principal is required to have capacity when the Enduring Power of Attorney is made. The formal requirements for making the enduring document are set out in Section 44. Sections 44(1) and (3) state that it must be in the approved form, it must be signed by the principal and it must be signed and dated by an eligible witness.
“44 Formal requirements
(1)An enduring power of attorney must be in an approved form.47
…
(3)An enduring document must—
(a)be signed—
(i)by the principal; or
(ii) if the principal instructs—for the principal and in the principal’s presence, by an eligible signer;48
and
(b)be signed and dated by an eligible witness.49
47An approved form is a form approved by the chief executive under section 161—schedule 3 (Dictionary).
48See section 30 (Meaning of eligible signer).
49See section 31 (Meaning of eligible witness).
It is advisable for the witness to make a written record of the evidence as a result of which the witness considered that the principal understood the necessary matters. For a power of attorney—see section 41 and for an advance health directive—see section 42.”
Accordingly, it is clear that an Enduring Power of Attorney is made when those requirements are met. I am satisfied they were met in the present case on the 17th of March 2003. If no later time is specified in the enduring document, the power thereby granted is exercisable once the Enduring Power of Attorney is made, and that is set out in Section 33(2).
In the present case, it is clear that the enduring document was to begin immediately. Therefore, the power granted could, subject to acceptance by the attorneys, be exercised by the attorneys at any time thereafter.
An Enduring Power of Attorney is not revoked by the principal losing capacity after it is made. That is set out in Section 32(2) of the Act. That is, the authorisation to the attorneys is not withdrawn or nullified if the principal loses capacity after the document is executed. That authorisation is to do anything in relation to financial matters which the principal could lawfully do.
“32(2) An enduring power of attorney 34 giving power for a matter is not revoked by the principal becoming a person with impaired capacity for the matter.”
34An enduring power of attorney made under the Property Law Act 1974 and of force and effect before the commencement of section 163 is taken to be an enduring power of attorney made under this Act—section 163.”
Although the authorisation remains available for acceptance by the attorney, the attorney may only exercise it after the attorney has signed the enduring document signifying acceptance of that position, and that is set out in Section 44(8) which provides:
“(8)An enduring document is effective in relation to an attorney only if the attorney has accepted the appointment by signing the enduring document.
The authorities clearly indicate that the giving of a Power of Attorney is a unilateral act. The decision of Abbott v UDC Finance Limited states clearly that:
"It is a unilateral act and the validity of a Power of Attorney does not depend upon acceptance by the attorney, although the act of the attorney is necessary to exercise the authority which the power confers."
The decision of the Queensland Full Court in Blacksell v Commissioner of Stamp Duties also states:
"A power or less of attorney or authority are not any the less of those descriptions because the donee of the power or person authorised chooses not to act upon them. They are complete when they are brought into existence."
Furthermore, the text "Powers of Attorney" by Collier and Lindsay provides, once again, that a Power of Attorney is simply a unilateral grant of authority by the donor to the donee to enable him or her to act on behalf of the donor.
Clearly, then, the declaration sought by the applicant should be made and the Enduring Power of Attorney executed by Mrs Murphy on the 17th of March 2003 was clearly valid despite the acceptance after the donor lost capacity and prior to the acceptance of those positions by the attorneys.
The only question which remains is the question as to costs. I consider in all of the circumstances that the respondent should pay the applicant's costs of this application on the standard basis. I do not accept that the Bank had valid reasons for not accepting the validity of the Enduring Power of Attorney.
The respondent states that the delay between the execution of the Enduring Power of Attorney and the acceptance by the attorneys was unusual and requires careful explanation before the enduring document could reasonably be expected to be accepted by the Bank.
However, it would appear that the Bank did not ask the applicant to explain the delay. It is clear that the respondent took the position they took without any reference to decided authorities on the point, and they simply took the position that they unequivocally refused to accept the Enduring Power of Attorney.
I do not consider that the other reasons advanced by the respondent in this application were reasonable in the circumstances. Accordingly, I will make the costs order that I have indicated.
...
The order of the court is that:
1.On a proper construction of the Enduring Power of Attorney made by Shirley Sylvester Murphy on 17 March 2003 the Enduring Power of Attorney may be exercised by the applicant and his co-attorney, Ross Collins Needham Walker.
2.The respondent shall pay the costs of and incidental to this application, to be assessed on the Supreme Court scale by a costs assessor.
3.The respondent shall immediately notify the Toombul branch of the respondent of this Order.
...