Sarah Young
Solicitor and a director of Ridley & Hall
Elizabeth Darlington
Barrister at 1 GC|Family Law
Hackett v Hicken demonstrates that meritorious claims can and should be pursued and the amount in dispute is not necessarily a determinative factor
From a legal point of view, the question can be a difficult one, in the sense that when seeking to recover misappropriated money or property, the amount in dispute is often a stumbling block to a potential claimant. This is because civil cases involving financial abuse generally involve an allegation of presumed undue influence. Each case turns on its own facts and gathering evidence can be expensive and time consuming. Whether the abuse relates to a one-off transaction such as a transfer of land, or a series of transactions, eg, ‘gifts’ of money from an account over a period of time, investigating the claim and proving it on the balance of probabilities can be difficult.
Proving that a gift is not in fact a gift, especially when the victim is elderly, or has passed away, means that, especially where the perpetrator is a family member, there may not be much in the way of documentary evidence. The version of events put forward by the claimant will most likely be hotly contested by the perpetrator, who will have justified their behaviour to themselves and others often over a long period of time. Feelings of shame, anger, guilt and embarrassment can also affect how the case is perceived by those involved in it.
As a rule of thumb, it is not unreasonable to estimate costs to trial of a financial abuse case at somewhere in the region of £70,000. Often the costs risk of litigating will exclude low value claims from court.
However, as the following case demonstrates, it is possible to bring a successful undue influence claim, even where the value is relatively modest. Hackett v Hicken is a presumed undue influence claim heard by Her Honour Judge Jackson at the County Court in Leeds on 8 and 9 June 2022, in which the claimant was represented by the authors of this article. It is considered that this case provides a useful and typical example of a situation that is, sadly, all too common.
The defendant, Stuart Hicken, was the stepson of Doreen Hicken, who died on 17 December 2018 at the age of 88. Over a five-day period in April 2016, Doreen transferred a total of £26,000 to Stuart, who subsequently repaid £10,000 into her bank account. Although Doreen suffered from dementia, it was not in dispute that she had mental capacity at the time of the transactions. By the time proceedings came to be issued, she had lost capacity and was unable to provide a statement. She sadly passed away a few months after the issue of the proceedings. Doreen’s daughter, Susan Hackett, pursued the claim to trial as her mother’s personal representative.
In 2016, Doreen, who was a widow, had been living on her own and independently in Bridlington. It was becoming clear to her family that she was confused and vulnerable and she agreed with Susan that she should move into a care home. The transactions in dispute took place very shortly before that move and only came to light when the local authority made enquiries into Doreen’s finances in relation to her care home fees. Susan was horrified to find out that a substantial proportion of her mother’s lifesavings had vanished from her account. Stuart, when challenged, denied any wrongdoing—he said that £15,000 was a gift from Doreen to him to share equally with his brother and sister, and that the remaining £1,000.00 in dispute had been spent by Doreen on a short break.
To succeed in the claim, it had to be proved that Doreen placed trust and confidence in her stepson and relied on him in the management of her finances. The transactions had to be proved to be to her manifest disadvantage and to call for an explanation. If the court was satisfied that the £16,000 could be presumed to have been procured by undue influence, then the burden of proof would shift to Stuart to prove otherwise.
The court had to investigate the way in which Doreen’s intention to enter into the transactions was secured. Her Honour Judge Jackson found in favour of the claimant. On the issue of a relationship of trust and confidence, the defendant did not challenge that such a relationship existed between himself and his stepmother; although Doreen was “relatively independent in respect of her finances on a day-to-day basis”, it was accepted that “she did place trust and confidence in the Defendant in relation to financial matters”.
In relation to the next element of the claim as to whether the transaction called for an explanation, the judge said: “There is no suggestion on the evidence before me that Mrs Hicken had a history of making grand financial gestures or even that she made modest or insignificant financial gifts to the Defendant and his siblings.”
The original transaction of £26,000 “represented virtually all of Mrs Hicken’s life savings”.
The judge went on to say: “Whilst £26,000.00 or £15,000.00 may be regarded by some as relatively modest, here it was substantial. It was the money from which Mrs Hicken needed to fund the remainder of her life.”
The judge found that the transfer required an explanation and was not reasonably explainable by reference to the ordinary conduct of Doreen’s life. The burden of proof shifted to the defendant, who was unable to satisfy the court that Doreen entered into the transaction freely.
It was clear from the evidence that Doreen was asked on each occasion that she made a transfer of money at the bank why she was doing so. The explanations provided to bank staff were that the money was needed due to her move. There was no mention made of gifts.
The judge said: “It was not a decision freely made by her, in full knowledge of the circumstances and freed from influence.”
Of central importance to the judgment was the rejection by the court of the evidence of the defendant. In order to discredit him, it was necessary to consider Doreen’s GP notes and hospital records, both before and at the time of the transfers of money, in detail, in order to paint as clear a picture as possible of her mental state. It was also necessary to consider in detail the relevant bank statements and records. The contemporaneous documents demonstrated that the defendant’s account lacked credibility and where there was contemporaneous evidence before the court, the judge preferred it to that of the defendant.
While the authors do not consider that this decision will open the floodgates in relation to low value presumed undue influence claims, it does nonetheless demonstrate that meritorious claims can and should be pursued and the amount in dispute is not necessarily a determinative factor. As a matter of public policy, we can and should protect the vulnerable in society from financial abuse. This includes groups such as the elderly, former cohabitants and others who are vulnerable by reason of disability or illness. This decision sends a strong message to potential perpetrators that the law can be used to recover ill-gotten gains.
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