30 September 2020 - Events
Like many jurisdictions around the world, Hong Kong faces the demographic trend of an ageing population. According to the Census and Statistics Department of the Hong Kong SAR, out of a current population of about 7.5 million, 17.7 per cent is over 65 years of age and this figure is expected to double by 2036. Unsurprisingly, there is also a corresponding increase in the number of people with dementia, with an estimated increase of 222 per cent from 2009 to 2039.
An ageing population presents challenges for the society not only in economic terms (e.g. a shrinking labour force and increased expenditure on health care) but also in legal terms (e.g. loss of mental capacity to make legally effective decisions and the need for protection for mentally incapacitated persons (MIP)). In this regard, it is important to promote the use of planning tools available to our elderly citizens in preparation for mental incapacity. In Hong Kong, the Mental Health Ordinance (Cap. 136) (MHO) and the Enduring Powers of Attorney Ordinance (Cap. 501) (EPAO) are two pieces of legislations governing the law in this area.
Legally, there are two main actions that individuals can take to protect themselves whilst they have capacity. The most obvious one is to prepare a will. The benefits of making a will have long been recognised and include: (i) avoidance of intestacy; (ii) enjoyment of one’s testamentary freedom; and (iii) the relatively low costs of having one prepared.
The second is to prepare an Enduring Power of Attorney (EPA), which enables an individual (the donor) to appoint a trusted person (the attorney) to exercise specific powers over specified properties and financial affairs in the unfortunate event that the donor becomes mentally incapacitated at a later date. However, the attorney’s powers to take significant steps (such as making gifts and executing a will) is limited without the Court’s involvement. The advantages of making an EPA are that it is possible for an individual to have control over his/her choice of attorney and the extent of the attorney’s powers can be tailored according to the circumstances of each case. To protect the donor, the EPAO provides that the attorney’s duties towards the donor are of a fiduciary nature and requires the EPA to be registered with the High Court such that it is kept on the register available for inspection by the public. An attorney can only deal with the donor’s assets after the EPA is registered. As the EPA is such a powerful instrument, the EPAO also requires the execution of an EPA to take place before a solicitor and a medical practitioner.
Unlike the Lasting Power of Attorney in England & Wales and in Singapore, a Hong Kong EPA unfortunately covers only matters relating to properties and financial affairs of the donor and cannot deal with healthcare and welfare decisions. Decisions relating to the healthcare and welfare of an MIP must be made by a guardian who is appointed by the Guardianship Board under Part IVB of the MHO upon an application by a relative of the MIP, a social worker, a registered medical practitioner or a public officer of the Social Welfare Department. The application usually takes three to nine months to process and must be supported by written reports of two registered medical practitioners. Although the MIP cannot choose his/her guardian, in determining the application, the Guardianship Board would take into account a social enquiry report prepared by the Social Welfare Department that sets out the views and wishes of the MIP to the extent they may be ascertained. Once appointed, the guardian may make decisions such as the MIP’s residence and medical treatment and would be empowered to withdraw up to HKD17,000 per month from the assets of the MIP for his/her maintenance or benefit.
Where healthcare and welfare expenses of the MIP exceed the statutory limit of HKD17,000 (which is often the case), an application for committeeship under Part II of the MHO would become necessary. The appointment of a committee is also needed where provisions for the MIP’s dependents are required. Under Part II of the MHO, the Court may appoint a committee of an estate if it is satisfied that the person who is alleged to be mentally incapacitated is incapable, by reason of mental incapacity, of managing and administering his/her property and affairs. A relative, a member of the legal profession or the Official Solicitor may be appointed as the committee of the estate of an MIP in this regard. A committee has significant powers over the MIP’s estate, including the acquisition of property on behalf of the MIP, execution of a will on behalf of the MIP and even conducting legal proceedings in the name of the MIP. An application for committeeship under Part II of the MHO, however, takes about six to nine months (possibly longer if contested) to determine.
Another (but less commonly used) tool available to elderly citizens in Hong Kong to deal with healthcare and/or medical treatment is an advance directive (also known as a ‘living will’ or an ‘advance decision to refuse medical treatment’ in England & Wales). An advance directive enables an individual (also referred to as a donor), whilst capacitated, to give directions on the healthcare and/or medical treatment he/she would like to receive in the event that he/she subsequently becomes mentally incapacitated. An advance directive could be given by way of a prescribed form prepared by the Hospital Authority to be used by an individual to specify whether life-sustaining treatment should be given to him/her in certain situations such as terminal illness, persistent vegetative state, or other end-stage irreversible life limiting conditions. It is important to note that an advance directive does not currently have legal status in Hong Kong and, in practice, medical practitioners may still prefer to consult the patient’s next of kin.
As outlined above, there are a number of planning tools available to elderly citizens in Hong Kong to manage mental incapacity and the community should be encouraged to make use of these tools. Although the best interests of the MIP will always be an important consideration for the Guardianship Board and the Court in determining guardianship and committeeship applications respectively, it is clearly preferable for an individual to exercise his/her decision-making ability while he/she has the capacity to do. This helps to avoid disputes among family members on the handling of properties and financial affairs of the MIP and healthcare and welfare decisions. Litigating disputes on these issues, as we have seen again and again, not only takes years but is also detrimental to family relationships.
This article was first published in STEP’s Winter 2020 Newsletter.