Cross-border column

  • Author : Richard Frimston
  • Date : January 2009
Richard Frimston TEP is a Partner at Russell Cooke LLP and Chairman of the STEP Cross Border Estates Group

A  few years ago, when I was young, a brand of whisky was advertised with the line, ‘Don’t be Vague, ask for Hague’. For EU and UK practitioners interested in private client work and private international law (PIL), Hogmanay 2009 must be celebrated.

We have not seen the ratification of a relevant Hague Convention into UK law since the 1985 Hague Trusts Convention by the Recognition of Trusts Act 1987 and before that, the 1961 Hague Wills Convention by the Wills Act 1963. One Convention every 24 years or so should really give enough time for maturation. Most malts are ready much sooner.

The ratification by France of the Hague Convention XXXV on the International Protection of Adults Convention on 18 September 2008 meant that having been ratified by three member states – France, Germany and the United Kingdom – it is effective from New Year’s Day 2009.

However, the UK is rather vague, since it has declared that the ratification only extends to Scotland. This is so, even though the Mental Capacity Act 2005 (MCA) specifically gives effect in England and Wales to Convention XXXV (in so far as the MCA does not otherwise do so) from 1 October 2007, and makes related provision as to English PIL.

The enactment of the MCA has not changed the vagueness and although Convention XXXV is effective in England & Wales, it is still only Scotland of the UK that has actually ratified. The UK Ministry of Justice (we don’t have one for England & Wales yet) has made it clear that ‘England & Wales is committed to extending Convention XXXV as soon as possible. The work for this is under way’.

The MCA does now set out the PIL on incapacity issues in England & Wales and therefore, in addition to setting out the rules for jurisdiction and recognition, it also defines the applicable law and therefore the rules as to which lasting powers (including enduring, durable and other forms of such powers) are or are not valid. A guardianship power validly made in South Australia by a person habitually resident in South Australia is now valid whenever the power was made. An English Enduring Power of Attorney made by a person habitually resident in a state where such powers are not valid, may now be invalid, even if made at an earlier time when the MCA did not apply. Forum shopping between Durable Powers now looks an option.

The ratification by France of the Hague Convention XXXV on the International Protection of Adults Convention on 18 September 2008 meant that having been ratified by three member states – France, Germany and the United Kingdom – it is effective from New Year’s Day 2009

The position in Northern Ireland is that NI Enduring Powers of Attorney (NIEPA) remain valid and can still be created. Since there are, as yet, no new private international law rules in Northern Ireland, a NIEPA will be valid under Northern Irish law, but not under English law if the donor was not habitually resident in Northern Ireland at the time of the making of the NIEPA. If Northern Irish law is clearly specified in the NIEPA (which one can argue is the case in relation to the statutory form) then the NIEPA is valid but only in relation to property situated in Northern Ireland and not to any other property. Northern Ireland will not recognise any form of Lasting Power other than a NIEPA.

The difficulty also remains that Schedule 3 extends Convention XXXV to the applicable law issues of all Lasting Powers and not as under Convention XXXV only to those of adults subject to an incapacity. The problem of how a bank can know whether Doch or Doris does or does not have capacity at any particular time, writ large.

Do you need to down a Scotch?


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