When a widow gave a power of attorney to her solicitor in 1985, she also executed a conveyance over the property in which she lived which made her son the beneficial joint tenant of the property. Under such an arrangement, each of the joint tenants is the owner of the whole property and, on the death of one, the ownership of the property passes to the surviving joint tenant(s). As the woman’s son was in need of money, she also took out a mortgage of £23,000 on the property and gifted that sum to him. The actual conveyance was executed by her solicitor, using the power of attorney, as she was on holiday in Canada at the time this was being done.
The mortgage was later repaid. A charge over the property was then given to the Midland Bank to secure further borrowings, which were also subsequently repaid. When the woman died in 2008, the property was debt free.
Shortly before she died, the woman executed a will which stipulated that her property should be sold and the proceeds divided equally between her children. However, ownership of the property passed to her son by operation of the joint tenancy.
The other family members claimed that the original conveyance had been a mistake. It was their contention that the property had been intended to be owned by their mother alone, and it was not her intention that their brother should acquire any beneficial interest in it. They went to court to have the conveyance ‘rectified’.
Initially, the court declined to make the order, because the conveyance had been executed under a power of attorney. Since there was no question that the power of attorney was valid, the court held that the conveyance could not be challenged, despite the fact that the woman had ‘never intended to give, and never thought that she had given, a beneficial interest in the property’.
The family appealed against that decision.
The Court of Appeal considered that it was the ‘subjective intention’ of the woman that was important. Since the outcome that was effected by the conveyance was not the outcome she intended – which was that once her son had repaid the borrowed money, the property would be hers again – the Court ordered that the title to the property should be restored to her estate.