Day v Harris & Anor

Registration of an enduring power of attorney fixes the scope and operation of the EPA itself. It does not extinguish a separate authority held by the attorney, such as a joint-account mandate. The attorney may therefore make a self-benefiting payment through that separate authority if the donor gives full, free and informed consent.

For a chattel delivered without a deed or declaration of trust, gift or bailment turns on the deliveror’s objectively ascertained intention. Delivery and absence of rejection may complete the gift. A general reference to etc may include all remaining contents of delivered boxes. A will gift of manuscripts may extend to manuscripts held by a third party, and an intended lifetime gift may be perfected when the donee becomes executor.

Two appeals arose from disputes concerning the estate of Sir Malcolm Arnold. The first concerned five payments totalling £36,000 made to Anthony Day from a joint bank account after registration of an enduring power of attorney. The second concerned ownership of musical manuscripts deposited with the Royal College of Music.

His Honour Judge Purle Q.C., sitting in the Chancery Division, held that Mr Day was not liable to account for the payments. He also held that the manuscripts delivered to Katherine Arnold in 1976 had not been gifted to the children, that they were not covered by clause 6 of the will, and that a later imperfect gift to Mr Day was perfected when he became executor. The central issues were the effect of registration of the EPA, the objective intention attending delivery of the manuscripts, the construction of clause 6, and the effect of the 1998 gift document.

Disposition. The money-gifts appeal was dismissed by a majority comprising Lloyd LJ and McFarlane LJ. Rix LJ dissented. The manuscripts appeal was allowed in part, and Mr Day’s Respondent’s Notice succeeded on the construction of the will.

1. Enduring power of attorney. The majority held that section 7(1)(c) of the Enduring Powers of Attorney Act 1985 fixes the scope and operation of the EPA itself. It prevents the donor from extending or restricting that authority, or from altering its legal effect by a later instruction or consent. It does not regulate every separate agency relationship between donor and attorney. Mr Day could therefore continue to operate the joint account under the bank mandate after registration. He could benefit himself only with Sir Malcolm’s full, free and informed consent.
2. Consent and appellate review. The trial judge was entitled to find that Sir Malcolm had capacity to make the gifts, understood their inheritance-tax purpose, and consented to the recurring annual payments. The evidence, including the established pattern of gifts and the relevant advice, provided a proper evidential basis. The Court of Appeal would not interfere with those factual findings.
3. Manuscripts delivered in 1976. For a chattel delivered without a deed or declaration of trust, the relevant intention is the deliveror’s intention objectively assessed from words and conduct. Delivery and the absence of rejection by the recipient were sufficient here. The later dealings did not show Sir Malcolm’s intention and did not establish a clear representation giving rise to estoppel. The word etc in the postcard referred to all the remaining contents of the boxes, including the manuscripts. The children therefore owned the 1976 manuscripts and the Fair Field manuscript.
4. Will and later gift. Clause 6 extended to all manuscripts owned by Sir Malcolm at death, including those deposited with the Royal College of Music. The 1998 document expressed an immediate gift. The proposed catalogue was intended to remove uncertainty, not to constitute an essential condition. Although delivery was initially absent, the gift was perfected under the principle in Strong v Bird (1874) LR 18 Eq 315 when Mr Day became an executor. The 1980 manuscripts and the three manuscripts delivered by Faber Music therefore passed to Mr Day.

Rix LJ would have allowed the money appeal. In his view, registration created a statutory watershed: section 7(1)(c) prevented reliance on Sir Malcolm’s post-registration consent, and Court authorisation under section 8(2)(d) or (e) was required.

• Court of Appeal (Civil Division) In [2013] EWCA Civ 191, the money-gifts appeal was dismissed by a majority. The manuscripts appeal was allowed in part, with the Respondent’s Notice succeeding on clause 6 of the will.
• High Court of Justice, Chancery Division His Honour Judge Purle Q.C. dismissed the challenge to the £36,000 payments and held that the 1976 manuscripts had not been gifted to the children. He held that clause 6 did not include the manuscripts, but that a later imperfect gift to Mr Day was perfected when he became executor.