Distributing a Donor’s Jewellery – Top Tips for Attorneys
Distributing a Donor’s jewellery to Relatives
Can a Donor’s jewellery be passed to beneficiaries named in the Donor’s Will?
This is an interesting point that attorneys often ask me questions about. There are many reasons why attorneys might want to give a Donor’s jewellery away – storage issues are a common reason.
Of course, it’s not always safe to leave valuables such as jewellery in the Donor’s own home and if you store them in your home it can lead to all sorts of problems.
You might think passing items of jewellery to beneficiaries named in the Donor’s Will would be a neat solution to the storage problem, especially if the Donor is mentally incapacitated. But you first need to consider whether you’re allowed to give away the Donor’s possessions.
Does a Will give attorneys authority for distributing a Donor’s jewellery?
If a Donor has specified gifts of jewellery or other valuables in their Will, the attorneys sometimes use that as justification to distribute the Donor’s personal possessions. Attorneys who do that often claim they’re following the Donor’s expressed wishes… just a bit early.
The legal position is that a Will only applies to a person’s estate after death. Attorneys have no authority in respect of a Donor’s Will. The attorneys’ authority comes from the power of attorney that appoints them. Attorneys can’t rely on the Donor’s Will as legal authority to start distributing the Donor’s possessions to other people.
Distributing a Donor’s jewellery might be justified…
It’s important to remember that the Mental Capacity Act 2005 Section 1 imposes an obligation on attorneys to act in the best interests of the Donor.
The Mental Capacity Act 2005 permits attorneys to make gifts on behalf of a Donor in very limited circumstances. Any gifts must be in the best interests of the Donor. There may be circumstances in which making gifts of the Donor’s jewellery could be considered to be in the Donor’s best interests.
If the cost of insuring and storing the jewellery is relatively high there could be an argument for an attorney distributing the Donor’s jewellery to reduce the financial burden of keeping it safe.
Another justification for distributing the Donor’s jewellery before the Donor dies might be if the value of the jewellery is quite low in proportion to the value of the Donor’s total assets; especially if the cost of storage or insurance would be relatively high.
Here are some tips for distributing a Donor’s jewellery to relatives.
Top Tips for Attorneys on Gifts of Jewellery:
- Check whether the gift is within the Mental Capacity Act rules about permitted gifts;
- Consider getting the jewellery valued;
- Loaning the jewellery to the intended beneficiary may be a solution but use a written agreement;
- Record the reasons for your decision to distribute the jewellery;
- If the jewellery is very valuable apply to the Court of Protection for authority to give away the jewellery to be sure you’re authorised.
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