Deputy Standards

Given the authority that a Court of Protection Deputyship order might provide to a deputy, the Office of the Public Guardian (OPG) produced a deputy standards guide in 2015. The guide outlines what is expected of a deputy. It is important that the guide is considered by all deputies prior to the discharge of their functions, to ensure the efficient undertaking of duties, as expected by the OPG. It is important that the deputy considers the main points, referring to them in the general management of a protected party’s finances, on an on-going basis. These key points can be summarised as follows:-

  • Identify, review and secure all welfare benefits the client may be entitled to. It will also include submitting claims and lodging appeals at the earliest opportunity.
  • Seek independent financial advice where appropriate. This is to maximise the return of the protected party’s savings, investments and any other assets.
  • Carry out reviews of savings and investment portfolios at least once a year. Where necessary the deputy should seek expert and independent advice.
  • Demonstrate responsible use of assets, rather than asset preservation.
  • Ensure the deputy and all members of staff delegated with deputyship responsibilities have access to appropriate advice and expertise on investments, savings and property.

The above highlights some of the key responsibilities that the deputy needs to consider when managing the financing of the protected party. The guideline also applies to lay deputies and not just professional deputies. If a lay deputy is unsure on their duties they should seek assistance from the OPG, or a professional, at any given time. It should be noted that care needs to be taken when selecting a firm to provide financial advice as many direct discretionary fund managers and other advisors are only able to offer a restricted financial advisory service contrary to the standards outlined by the OPG.

Should a lay deputy require assistance on this specific issue, please contact the Court of Protection team.

Discretionary Trusts For Disabled Persons As A Means Of Ringfencing

Disabled people tend to have limited life chances and income. This means that if they were to receive an inheritance it could provide them with a once-in-a-lifetime opportunity that could make a real difference to their quality of life.

However, many disabled persons are long term recipients of means-tested benefits. If they were to inherit an amount in excess of the means testing capital thresholds outright, the individual may find that they are no longer entitled to support. This might include not only their weekly benefits, but also the social care and some elements of their treatments. Their inheritance would simply replace their subsistence entitlements. This often puts people off leaving a legacy to a disabled person in their will.

We have worked on many cases where a disabled person has been excluded from a will. This problem can be avoided by setting up a discretionary trust in the will which would keep the legacy separate for the purposes of means testing. In such cases, we apply for a variation of the will under the Inheritance (Provision for Family and Dependants) Act 1975.  This ringfences the award for the purposes of means testing and guarantees that the individual receives real substantive benefit from the gift.

It is important that the trust is set up correctly. The trust should be set up first and then the monies should be paid in straight from the estate. If this is not followed, and the person receives monies directly from the estate or before the trust is set up, there may be problems with the DWP deprivation of capital rules.

There are complex qualification rules as to the nature of the trust, such as how income and capital are to be dealt with. The trust deed needs to be thoughtfully drafted and structured to ensure it also qualifies as a disabled persons trust, otherwise substantial tax liabilities will result. This is a complicated area of law and it is essential that the trust is set up correctly.

At Anthony Gold, we have a wealth of experience in this area of law. If you would like our advice, please contact the Contentious Probate Department at Anthony Gold on 020 7940 4000.

Assessing Capacity: How the Mental Capacity Act 2005 Principles are Applied when Assessing P’s Capacity

The law gives a very precise definition of what it means to lack capacity for the purposes of the MCA 2005. Section 2(1) of the MCA 2005 provides that;

a person lacks capacity in relation to a matter if at the material time he is unable to make a decision for himself in relation to the matter because of an impairment of, or disturbance in the functioning of the mind or brain

This definition gives rise to a two-limbed test. The first limb being whether P is unable to make a decision for himself (The Functional Test) and the second being whether that inability is because of an impairment of, or a disturbance in the functioning of the mind or brain (The Diagnostic Test). The starting presumption is always that P has capacity to make that decision and this is fundamental to the Act.

Capacity is decision specific and so although P may have been assessed as lacking capacity to manage their property and affairs which requires the appointment of a deputy, it does not necessarily mean they lack capacity to manage all aspects of their finances. For example, they may be able to make day to day spending decisions but may lack capacity to make more complex decisions such decisions around investments.

Therefore, in order to comply with the MCA the test of capacity will need to be applied to each individual decision and a Deputy making decisions on behalf of P must be satisfied that they have taken all reasonable steps to help P make the decision for themselves, before making a decision on their behalf.

It is not necessary for P to understand every element of what is being explained to them. What is required is a broad understanding and the level of that understanding should not be set too high.

In addition, people who have capacity often make unwise decisions and it is important that a protected party’s freedom to do the same is also not restricted This is a fine balancing act and it is important to be aware of the dangers of associating an unwise decision with the inability to make a decision.

An example of this may be where P does not agree with a professional opinion. This does not necessarily mean that P lacks capacity to make the decision. What would need to be considered here is whether P can weight up, use the information and understand the consequences of their decision making.

Most healthcare professionals will be able to carry out a capacity assessments which is decision specific. They will do so applying the test and principles set down in the MCA. Each assessment is unique and will be carried out specific to P’s circumstances.

It may be the case that another healthcare professional, such as a social worker will know P better than a GP or Consultant. As such they may be in a better position to provide a more thorough capacity assessment. Failure to carry out a detailed capacity assessment can expose substantial risks therefore it is of paramount importance that the principles are applied correctly and the assessment is carried out by the most appropriate person available.

For reference, the core principles of the Mental Capacity Act are as follows;

s.1(2): P must be assumed to have capacity unless it is established that he lacks capacity;

s.1(3): P is not to be treated as unable to make a decision unless all practicable steps to help him to do so have been taken without success;

s.1(4): P is not to be treated as unable to make a decision merely because he makes an unwise decision;

s.1(5): an act done, or decision made, under this Act for or on behalf of a person who lacks capacity must be done, or made, in his best interests; and

s.1(6): before the act is done, or the decision is made, regard must be had to whether the purpose for which it is needed can be as effectively achieved in a way that is less restrictive of the person’s rights and freedom of action.

 

* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*

Making an urgent application to the Court of Protection

It has not been defined when an application should be classified as “urgent”.

Consensus is that an urgent application is where the court would need to deal with an application as soon as possible, usually within 24 hours.

It is usual for urgent applications to be made within court hours and dealt with at the court itself. On rare occasions, an application can be made out of hours by contacting the court by telephone and explaining the purpose of the application.

If made by telephone, the court will require an undertaking (a formal promise to do something) that the application form in the terms of the oral application will be filed at court.

An urgent order can be used for a variety of reasons such as:

  • Where there is a real risk of assets being lost, subject to financial abuse.
  • Access to funds in order to pay nursing home or care fees.
  • To meet a liability to pay the maintenance of a dependent.

A unique feature of an urgent application is that the court has discretion to disregard the filing of a COP3, the all-important capacity of assessment form. One may think this is odd given the role of the Court of Protection is to be satisfied that P does in deed lack capacity. However, in order to ensure that there is no loss to P, the court will usually waive the need for medical evidence, but limit the application to an interim (temporary) order for a set period. This would therefore ensure that the full application would still be considered at a later stage.

For the court to make such an order there would usually be directions to serve notice on the following:

  • Every party to the proceedings.
  • Anyone named as respondent in the application.
  • Any other person that the court directs.

Everyone should therefore be alive to the notion that the court does have wide discretionary powers in order to “jump” the queue, but it must be justified. The court could award a wasted costs order if the application is without merit.

Should you require assistance on such an application please contact the Court of Protection team at Anthony Gold.

* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*

Can I claim a refund via the Lasting Power of Attorney Refund Scheme?

Last year the Office of the Public Guardian (OPG) admitted that the fees it was charging for registering powers of attorneys were higher than the cost it actually incurred processing the applications.

As such the fee for registering an LPA was reduced in April 2017 from £110 to £82 and the OPG have launched a refund scheme so that those who paid the higher amount can apply for a partial refund.

A donor or attorney can apply for a refund if an application to register a power of attorney was made from 1 April 2013 to 31 March 2017.

How much is refunded will depend on when the fees were paid however the refund will also include interest at 0.5%.

The refund amounts are as follows:

When you paid the fee Refund for each power of attorney
April to September 2013 £54
October 2013 to March 2014 £34
April 2014 to March 2015 £37
April 2015 to March 2016 £38
April 2016 to March 2017 £45

 

It may take up to 12 weeks for a claim to be processed and the scheme will run until 31 January 2021.

Only a donor, attorney, deputy or a personal representative (where the donor has died) can make the claim and receive the refund.

Those seeking a refund can apply online or call the OPG on 0300 456 0300. Deputies and PRs must claim by phone. More guidance for completing the refund claims process can be found on the Gov.uk website, click here.

* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*

 

Fraud and the vulnerable – professional duties

It is a sad fact that the vulnerable are far more susceptible to fraud than the capable. One would assume therefore that professionals would owe a higher duty of care, when advising vulnerable people. This is especially so in relation to transactions.

However, this is not expressly set out in the 24th Edition of the Conveyancing Handbook for 2017. The Conveyancing Handbook, at Section 1.6.3, states that the Money Laundering Regulations 2007 (SI 2007/2157) apply to transactions. Those regulations require lawyers to take a risk-based approach to customer due diligence. However, being vulnerable is not listed as a risk factor. This may be due to problems in defining the vulnerable and concerns around discrimination.

Despite this, case law is full of examples of the vulnerable having been victims of not only fraud but also undue influence and professional negligence. This shows the vulnerable are clearly more at risk than the capable. As such they need additional assistance. Despite that, advice is often not as good as it should be. Some are not even aware of basic safeguards, such as only proceeding with a conveyance under a Lasting Power of Attorney, once they have received an office copy of that power from the Office of the Public Guardian (see Handbook at E2.11.6).

Part of their vulnerability stems from the fact than some are challenging people to deal with. The vulnerable are often isolated people with difficulties with communication and understanding financial issues. Many transactional lawyers operating on a fixed fee, find such clients taking up more time than others.  They become a client to avoid, not a client to invest considerable extra time in.

Despite having worked for many years with vulnerable people, either directly or on behalf of the Official Solicitor, Local Authorities or the Court of Protection, it is my view that such clients do require additional time and support. The Law Society guidance to the profession – meeting the needs of vulnerable clients sets out many good practice points, however all of them require additional thought and time. There is no shortcut to effective communication. Unless this is factored into the work, some vulnerable people will continue to experience problems.

A further risk factor is that once a problem has occurred some vulnerable people can find it difficult to raise issues in a timely fashion. This reduces the chances of correcting mistakes and mitigating losses. They are then faced with making a claim to recover losses. Again, this process will be difficult for them. Whilst, for those who lack capacity the usual limitation rules do not apply, some will miss out on recovery, unless they find specialist advice.

Given the ever-growing population of elderly and vulnerable people, this real need should be seen not as an additional risk, but as an opportunity to add value.  Equally those advising vulnerable persons should appreciate that they do require additional support and time.

* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*