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Court of Protection applications

6 Dec


Court of Protection applications


What do the Court do?  The Court of Protection have one remit, that is to make decisions on behalf of people who lack capacity to make them for themselves.  If they are found to have capacity on any particular issue, the Court lacks jurisdiction.


They make simple deputyship orders for people who lack capacity and did not make LPAs before they lost it or perhaps the person has always had an impairment.  These are relatively straightforward applications and within the Court, might be considered by a senior administrator rather than a judge, as they are considered sufficiently straightforward.


So, what are the more complicated matters they will deal with?  They make decisions that involve and an attorney or deputy that is considered “self-dealing”, which is when the person in charge of the money wants to purchase or sell an asset to themselves.  It could also be about investing money in the attorney or deputy’s business, something where the transaction has a financial link to the deputy or attorney.


The Court also want to look at requests for gifting.  There have been a number of cases recently following which the Court has tried to provide guidance on what is acceptable gifting and what isn’t, which helps with what needs to be reviewed by the Court as being something that is more than just basic modest gifting.  The Court will grant orders for gifts more than just something very basic, but there needs to be a good reason to do so.  The Court needs to be persuaded that it in the best interests of the person whose money it is, to give it away and is therefore not available to them for their own needs.


The Court will deal with fraud cases, where someone has used the money inappropriately and was way beyond their authority to use the money or they have simply stolen it.  The Court will seek to recover the money for the person if they can and will also replace the attorney or deputy with someone more suitable to manage their affairs.


The other thing that they consider is disputes, which covers all kinds of things from financial to health decisions and some issues that cover both.  This has arisen because two sides don’t agree about something and usually each of them thinks that they are right and that what they want is in the best interests of the person.  The Court will hear both sides and make their ultimate judgement.


These applications that are more than just simple deputyship for finance can be difficult to do, they require lots of forms and the arguments have to be structured in a way that will make a difference to the Court.  There is legislation that deals with people who lack capacity and the Court needs to be persuaded that this legislation is not sufficient to deal with the current situation and something different needs to happen.  There is often a long delay between submission of the forms and the order being granted, so if there is a requirement for the case to be seen promptly, then this is another challenging aspect of these kinds of cases.




Managing the affairs of someone else – A professional appointment – Health and Welfare Decisions – Part2

22 Nov


Managing the affairs of someone else – A professional appointment – Health and Welfare Decisions – Part 2


I have had quite a bit of feedback on the article I wrote on this subject, so I thought it worthwhile to go into some more detail about this issue.


In any one day, we make thousands of individual health and welfare decisions, including such things like how much porridge to put on the spoon each time we take a separate spoon full and how big a gulp or sip of tea we have each time we drink our tea.  The vast majority of these decisions no attorney or deputy would get involved with, they would happen with the carer on hand without the deputy sitting there saying that the tea is too hot by 1 degree or there is 10ml too little milk in the coffee!  So, whilst that sheds light on what as a professional I won’t do, it still doesn’t necessarily assist with what I would do.


It is also important to appreciate that the level of understanding that we have for any given situation as an able person is often quite low, yet we don’t question capacity.  The House of Lords undertook a post legislative scrutiny of the Mental Capacity Act (MCA) in 2014 and they found that in general, health professionals are “paternalistic” and social services are “risk averse” and as such the MCA was not working as well as it was envisioned.  Life is full of poor decision making and bad judgement by all of us sooner or later!  How many times has anyone been asked to discuss liver disease and its full gamut of health consequences when ordering their third cocktail and a detailed assessment of the impact on their immediate family!


Generally, the key decisions that someone wants their attorney to make are around life sustaining treatment and where they live.  There can also be some other key decisions that are important to that one person, but are not necessarily generically important, such as ensuring that the person always has a particular brand of chocolate in their room or a drink of wine (which in one case I dealt with had to be thickened to make it like a jelly sweet!).


Life sustaining treatment is not just CPR (Cardiopulmonary Resuscitation) otherwise known as chest compressions, it can be anything that sustains life, including in some circumstances food, fluid, antibiotics or trips to hospital.  Most people want these important decisions reserved back to their family or someone who is not going to make a risk averse decision.  I met an elderly man recently and what he wanted was to live at home in his last few days / weeks / months with his dog, he was in hospital and he missed his dog.  There was risk in him going home in his poorly state of health, but he was less concerned about the risk and more concerned about being with his dog.  This is where the high level of understanding is then expected of a person with an impairment, yet this same high level of understanding is not necessarily expected of able bodied people and all the detailed consequences of the decisions they make.  This is where principle 3 of the Mental Capacity Act is relevant “A person is not treated as unable to make a decision merely because it is an unwise decision”.


The other key decision is about where someone lives, which in the context of being an attorney is usually relevant when the person is in hospital and wants to leave, usually to go home or when there is a question that they might need to go into care and they want to stay at home.  When there is a bed shortage in hospital there can be pressure on the attorney to find a suitable care home for the person to go to within a very short space of time.  I have been involved in a few cases where the suitable bed meant a delay of a couple of days to the right care home and when threatened with moving out to an available bed, as attorney they can refuse to allow that person to be discharged to the available bed, if it is unsuitable, to ensure that the few days for the appropriate bed is waited.  The decision can also be about whether or not the person goes into care or stays in their own home.


Attorneys who take reckless chances are at risk of someone applying to the Court of Protection for their removal, but there is a difference between taking a measured risk and being reckless.  This is the balance between length of life and quality of life and where the divide between those two things exists.  The answer to that issue lies with a discussion with the donor of the power of attorney and with those who know the person well and then finally onto the broad by necessity shoulders of the attorney to take responsibility for the decisions that they make.


Managing the affairs of someone else – A professional appointment – Health and Welfare Decisions

25 Oct


Managing the affairs of someone else – A professional appointment – Health and Welfare Decisions


There are two ways in which a person can be appointed as an ongoing basis to manage the affairs of someone else and this is by appointing them under a power of attorney or the Court of Protection appointing them under a deputy application.  A person can appoint their loved ones or a professional whilst they retain the capacity to do so.  The Court of Protection will appoint someone if this has not happened, they lose capacity and need someone to support them or take over. Health and welfare decisions can only be made when that person lacks capacity to make decisions for themselves, so they are always relying on the decision making of the attorney to make decisions that they would be happy with.


In general, a professional appointment of a solicitor tends to be for finances only, as it is generally accepted that loved ones would know the person well enough to make health and social care decisions, but it would be hard to make decisions against medical advice for a professional who doesn’t know what the individual would want.  It is for this reason that the Court of Protection would be very unlikely to grant a health and welfare deputyship order to a solicitor.


So, there are limited circumstances in which I will agree to act as either deputy or attorney for health and welfare.  The circumstances are either when they have no suitable family member to act and I have had an opportunity to sit down with them and go through their medical history and have an in-depth discussion about their care priorities.


The other circumstance that I will act is where I am co-attorney with a family member who lives further away and needs someone to be “on hand” to deal with the issues that arise.  I would always defer to the family member who knows the person better, however with my experience, I can make suggestions to the co-attorney about how the persons care can be best managed.  This arrangement works well, I stay in communication with the family member and they are able to effectively support their loved one from a long distance away.  The attorneys and the person themselves know that the role will be undertaken professionally and that their distant loved one is supported in their attorney role, which can be distressing with an added element of feeling helpless through the distance in which they live away.


This is work that I love, I get to meet the person and make sure that they are cared for in a manner that is best suited to them and that their loved ones are informed, but still able to maintain their own lives.  It is a great outcome for all!

Managing the affairs of someone else – A professional appointment – financial affairs

11 Oct


Managing the affairs of someone else – A professional appointment – financial affairs


Following on from my last blogs about managing the affairs of another person, what should the person do if they have no-one to do that or if they don’t get on with their family?  They can appoint a professional like me and I act for a number of individuals in some cases for both the finance and health and welfare.  I can also be appointed by the Court to be deputy (which is similar to the authority of an attorney), but these appointments are usually for financial affairs only.


My appointment is no different from the appointment of the family member, with the one exception that I charge a professional fee for the work that I do.  How much the fee is, depends on the complexity of the matter and in particular where they live, as if they live in care and they require the payment of their care fees and an annual welfare visit, the cost is far less than someone who lives in the community and due to issues arising I have to visit every few months.


I have a duty to maximise the estate for the benefit of that person, which means that I have an obligation to ensure that the funds are appropriately invested to ensure that there is an income.  I need to give consideration to the income and how the money is being spent, as someone who has only a couple of hours care a week or even a day, will spend less money than someone who has a full time live in carer.  How the estate should be managed has to have all the relevant information taken into account so that a bespoke strategy is achieved.  I even have to consider how much money is kept in one bank, as if the bank goes bust only the first £85,000 is insured and the rest could be lost.  I have to consider moving the excess to protect the client, if the worst happens.


I might be asked to make gifts and I have to consider whether that is reasonable.  I might have to take control of high value assets, so jewellery might need to go into a safety deposit.  If they have a safety deposit box, then I will need to know what is in it.


It is also useful to know what is in the Will, so that I don’t sell anything that is specifically gifted in their Will, such as jewellery or property.  If the donor leaves their house to someone and I’ve sold it, the disappointed beneficiary will not be happy with me and this is a circumstance that a statutory Will might be appropriated, so that the Court of Protection will grant a new Will giving a share of the estate that equates to the value of the property to that beneficiary.  So if there is a house worth £200,000 and cash worth £100,000, when the property is sold, whoever receives the cash will get £300,000 if there is only cash, but the Statutory Will would give 2/3 to the person who would have had the property and 1/3 to the person who would have had the cash.


My overall aim is to ensure that the wishes of the person are carried out as far as is possible to achieve, so if the client doesn’t want to go into care and it is possible to arrange their care in such a way to achieve that, then I do so.  If their primary concern is to be safe and cared for, then admission into care in some circumstances might be the right decision for them.  How I deal with their money depends on what their financial needs are, what their income is and what their capital is.


The firm that I work for has to insure the client’s money as part of their liability insurance, so within the firm there are safeguards to ensure that the clients’ money is safe from fraud or theft, including from me!  It is for this reason that I would not act with a co-attorney for financial matters, as I remain also responsible for the running of their affairs, including the fraud by co-attorney.


Having authority over another’s affairs is a big responsibility, which I take very seriously to ensure that the person is cared for as best as is possible to achieve and in the way that they want.


Managing the affairs of someone else – Financial Affairs

20 Sep


Managing the affairs of someone else – Financial Affairs


Following on from my last blog about managing the health and welfare decisions of another person, how do you manage the financial affairs of another person?


The starting principles are the same as with the health and welfare, what did the person themselves do before they became ill?  This should form a very important part of your decision, but you are not there to make their decisions, you make your own.  The question is what is in their best interests and all aspects of this issue should be taken into account when making this decision.


With regards to finances though, there are some rules around what can and cannot be done, as access to money puts the person at risk of fraud and theft.


Firstly, the attorney and donor should not have mixed finances, the funds should be clearly separated out into different accounts, so what money belongs to whom is clear.


If there is a large sum to invest, such as the proceeds of the sale of a property, then the investment strategy should be undertaken with the advice of a financial advisor, who will carefully look at the situation and work out what the investment risk profile of this person should be.  Depending on the circumstances, including the health issues and life expectancy of the donor and the amount of money involved, there could be lots of different scenarios to consider in financial terms.


The donor should not make investments into the business of the attorney, to provide financial support for them.  This is considered gifting, rather than investing and there should be a great deal of care taken over gifting.  This is also an issue of mixed finances, which again, should not happen.


Gifting is a big issue and I get asked lots of questions about this.  Can the attorney make gifts?  There is no simple answer, the phrase that is used regarding gifting is that it should be “on occasion” and “reasonable in all the circumstances and in particular to the size of the estate”.


What does on occasion mean?  It is birthdays, Christmas, graduation, house warming etc, gifting should be done at these specific times for specific religious, family or cultural reasons, not just because someone is short of money or has seen something in the shops that they fancy!


What about “reasonable in all the circumstances”?  The gift must be one that the donor either did or would have made had they been well.  There is no reason that they would gift anything to an estranged family member, if they hadn’t done in the years preceding their illness.  A plant or toaster is a suitable house warming present, the gift itself must be suitable for the occasion.


The other key part of the phrase about the gift being reasonable, is that it must be reasonable in particular to the size of the estate.  The Court of Protection has said that if the estate is over the value of the nil rate band, which is currently £325,000, then if there is nothing unusual about the estate, then the attorney can give away the £3,000 per year that is exempt for inheritance tax.  Where the size of the estate is smaller, part of the consideration will be what gifting that person made when they were well, such as £10 for the birthdays and Christmas of their two children will cost £40 per year, which would be reasonable for a modest sized estate.  When in doubt, the emphasis is to be less generous rather than more or to not make the gift at all.  Any gifts larger than the £3,000 discussed above or loans to the attorney would need specific Court approval.  The Court’s general view is that money is for the donor and not for anyone else, so there needs to be a good reason to gift it, but thinking fondly of someone is considered a good reason.


Managing the affairs of another person can be challenging, often because it comes at a time when the family is in distress anyway, because their loved one is unwell.  I am happy to provide support to those attorneys who need some advice.


Managing the affairs of someone else – Health and Welfare

6 Sep


Managing the affairs of someone else – Health and Welfare


In the past I’ve discussed creating LPAs, so that you can appoint another person to manage your affairs, if you become unable to do so.  It is probably worthwhile looking at this from the other angle, how do you manage the affairs of another person?


I’m going to take these subjects one blog at a time, starting with how to make health and welfare decisions for another person.


The only time that you can ever make decisions about another person’s health and social care decisions is when they lack capacity to make decisions themselves.  Each decision is different, it relates to the complexity of that individual decision and the time in which it needs to be made.  So people can lack capacity for complex decisions (such as what care to have or where to live) and still have capacity for simple decisions (such as whether they are thirsty or want to eat chocolate).  We almost all have something that is a pleasure to us, it becomes a habit, it might be a certain piece of clothing or a certain food (chocolate is a good example) and so people know for a long time that they like that thing, even when they lack insight into the bigger picture of their situation.


So the things to consider when making a decision is what would the person want?  That doesn’t necessarily mean that this is the decision that you will make, but it has to be a big influence on your decision.  Sometimes what people want isn’t possible (most people don’t want to go into care, but it might become necessary).  They might not want to make a fuss and accept what is going to happen, but that also might not be the right thing for them.


When making a decision you have to look at all the factors, the pros and cons of any situation and in the end you make the decision yourself, if you are attorney or deputy for health and welfare.  It must be an individual decision taking into account all the information that you know about this person, it should not be a generic decision about someone of the same age, race, gender, disability etc.  People have the right to make an “unwise choice” and should not be deemed to lack capacity because they do so and this also goes for attorneys, but the unwise choice must be in their best interests.  The primary purpose of the decision should not be to end or shorten their life, even if that is the case, there need to be another motivation to make a decision to shorten someone’s life, around why it is in their best interests.  This is to overcome the potential conflict of interest that arises when an attorney is a beneficiary of the estate and will ultimately inherit, so the shortening of life will hasten the inheritance.


Whatever you decide, you are responsible for the decision and the reasons behind the making of that decision, so if this is ever questioned by a family member of the authorities, the attorney will be able to stand by their decision and the reasons that they made it.  If the decision is not in their best interests, such as discharging a very poorly person from hospital to their home with no package of care, it would be considered neglect and an application to the Court of Protection to have that person removed could be made.


I’ve been consulted about lots of these kinds of matters and they are often around going into care, the continuation of medication etc, however I’ve also had the point raised by a client that they were a football supporter and did not want to wear the football strip of their rival team.  Universally the important decisions are often where someone should be cared for and their end of life decisions.  In order to help your potential attorneys, it is useful to have a conversation about these issues, so that they know your views.


Protecting your home from care home fees?

23 Aug


Protecting your home from care home fees?


I’ve recently been asked a few times about what can be done to stop the property having to be sold to pay for care home fees.  The irritating answer is – it depends and possibly not much!


It is entirely understandable that people who have worked hard to save their money and own their house want to be able to pass it on to their loved ones.  However Local Authority care is means tested and in Plymouth the cost of social care is about three quarters of the entire Local Authority budget and resources are limited.  The Local Authority cannot avoid its statutory obligation, to care for individuals within their area who are in need of their support, so this means that the Local Authority will look closely at the cases where they consider that people have intentionally deprived themselves of assets in order to avoid paying for care.


Whilst I fully understand the issue about wanting to pass on wealth, I do not understand why someone would prefer to lose choice and potentially quality as well for the care that they might need, just so their relative can benefit!


So, let’s go through some of the rules:


If the property is occupied by a spouse, partner, relative over 60 or disabled relative, then the property is exempt anyway.  If the property is jointly owned and the co-owner refuses to sell, then the only thing that could be sold is a half share and this has little value on the open market, which effectively exempts the share of the property.


The requirement for care must be “reasonably foreseeable”, due to existing poor health and people often think about doing something with their property once they are in poor health.  However if someone gifts their property when they are in good health, then this might exempt it, if they need care in the future, but since they may never need care, gifting the house and the costs involved might be unnecessary, particularly since only around 20% of people end up in care.


If a sole owner of a property gives it away, which these days, is often done by putting it into a trust, then that person has to continue without the need of residential care for a period of 5 years, or under the Care Act, the Local Authority can pursue that asset and undo the transaction, which defeats the object of doing it in the first place.


If the gift is made an absolute gift to a family member, which would be very unwise, then the person can find themselves homeless, if the family member gets divorced, gets into debt or dies.  If they get divorced, their entire asset portfolio would be taken into account, which would include the gifted property and this might need to be sold to deal with the issues relating to the divorce.  If they get into debt, their assets are realised to pay their debt and finally, if they die and leave the property to someone else, that person can serve notice and the donor of the gift finds themselves homeless.


So what if they give the property away and put it into a trust?  Trusts are taxable in their own right and are subject to Capital Gains Tax (CGT), Income Tax (IT) and Inheritance Tax (IHT).  Depending on the drafting and set up of both the trust and the assets, on the sale of the property to purchase a different one, the donor can find themselves having to pay CGT on the sale of their home, when if they owned it, they would not have had to pay.  There are also 10 yearly charges to IHT for trust assets over £325,000 at 20%, however the detail of calculating the tax is complicated!  Trusts require Trustees to care for the assets and depending on the kind of trust, may require minuted annual meetings and registration of the Trust with HM Revenue & Customs.


So I revert to my original answer of what can you avoid paying fees – it depends and possibly not much!  But I would also that it’s complicated and you might end up with something that you don’t intend, such as an unwanted tax bill!