A very warm welcome to another podcast episode with Warners Law. And today we’re joined by John Mackenzie, who is a Solicitor with Warners Law, and Ellie Norman, who is a Senior Paralegal with Warners Law. And they are both from the Court of Protection team at Warners. So, hi to you both. Hello. Now, Ellie, let’s start with you if I may.
Can you tell us a little bit about your team and the work you do?
As you just said, we are part of the Court of Protection team. So, our focus generally tends to be supporting clients who have lost capacity, be it through something like a mental health diagnosis such as dementia or perhaps people who’ve got an acquired brain injury. So maybe if there’s been an accident or something like that and we just help to manage their finances by way of Lasting Powers of Attorney deputy ships and possibly trust management as well.
So, we work quite closely with various financial institutions to ensure that funds and investments are managed appropriately. we also look after their income and outgoings, so, we ensure that any welfare benefits are claimed where appropriate. And we work very closely with social services and case managers and other healthcare professionals to make sure that care packages are appropriate for our clients and to make sure they’re well supported.
You kind of answered my next question, which is, who do you work for? And obviously, there’s a number of people involved. And following on from that, give me an idea as to your typical client.
That is quite an interesting question because, yes, the majority of our clients do tend to be a bit older and may not necessarily have family or friends to assist them, but we do actually support younger clients as well, and that includes children. They may need a deputy in place to help manage, perhaps maybe a personal injury award that’s been paid to them.
We do tend to see a lot of clients from all different sorts of backgrounds as well. You know, lots of people from different walks of life and they’ve all got kind of different stories, memories, different experiences. And actually, that’s what makes our work so interesting. There is no such thing as a typical day.
So, John, over to you. What is the Court of Protection and what powers does it have?
Well, the Court of Protection is quite a specialised court in England and Wales. It has the power to make decisions and take actions on behalf of people who don’t have the mental capacity to make those decisions for themselves. So, it’s a court that not very many people know about until they need to rely on it. It has a wide range of powers that are just simply aimed at protecting the rights and interests of vulnerable people.
It’s usually split off into two different pathways where it can make decisions about property and financial affairs. And this is sort of the work that we do here at Warners, specifically property and financial affairs, Court of Protection work. The court can make decisions about someone’s property, their finances, and what investments can and cannot be made on their behalf.
More importantly, you can also appoint a deputy so the court can appoint a deputy to make those decisions for that person rather than the court having to always make these decisions. Otherwise, the court would just be inundated with decisions that they have to make so they can appoint a deputy, which in our case is Martin Terrell, who is a Partner in Warners, and he is a deputy for 100 people at the moment.
But the courts can also make health and welfare decisions. It can make decisions about medical treatments, care arrangements, where a person should live who has a right to see that person or who doesn’t. It can resolve disputes. Again sometimes disputes can arise between family members, care providers, and other interested parties. Sometimes, despite best efforts, consensus can’t be reached.
And so they’d have to approach the court for a declaration either way. And finally, it can make declarations of incapacity. Sometimes there might be confusion as to whether this person doesn’t have the capacity to make a decision the person in question might insist that they do. Some family members might support them when they say that, but then there might be healthcare providers who say they feel differently and it’s important to get that question right.
And so sometimes they will go to the courts, who can then make a declaration of incapacity, having taken into account everyone’s submissions.
Can anyone be a deputy? I mean, who does that position?
Yes, pretty much most people can become a deputy; you must be 18 years or older for obvious reasons. You can’t have any criminal convictions and you can’t have a history of bankruptcy. If you’re going to be appointed to manage somebody’s finances, you should have shown that you have a good grip of your own before you’re appointed to manage somebody else’s.
But yes, a deputy comes around as a result of the vulnerable person not having made a Lasting Power of Attorney. When somebody hasn’t made that Power of Attorney and they then lose capacity, sadly, they can’t then make the Power of Attorney. So, the courts will step in and make an order to appoint a deputy.
I mean, in terms of the decisions that a deputy can take, can you summarise that?
Yes, from our perspective, we do the property in financial affairs aspects of things, so we make financial decisions. When someone’s, for example, going into care, they are more often than not liable for their care fees. So, we would have to decide which investment to cash in. We sell or purchase a property to raise funds for their care so they can stay where they are if that is in their best interests.
It should be said everything that a deputy does it’s underpinned by the framework of the Mental Capacity Act 2005. And a very key part of that is doing what is in the best interest of that vulnerable person, having taken into account their wishes and feelings as far as they can be obtained and the wishes and feelings of people who care for them, for example, family members, and care providers.
So, there’s definitely a financial acumen that needs to be applied within the decision-making role.
Yes. And the deputyship order can be quite specific. The deputy is authorised to go and take financial advice. So, the client is quite young and there’s a lot of money available for one reason or another. The onus is on the deputy to take good financial advice to maximise that capital for as long as they can and make it available for that person’s needs.
So, there is scope not just for a deputy to make decisions by themselves but also to take into account professional advice from other people as well.
And if you need to change a deputy, is that a simple process?
Well, yes and no. It involves an application to the court. So, you would have to prepare all the paperwork. You’d have to have a good reason as to why the deputy would be changed; as I’ve said before, a deputy is bound by the mental capacity to act in the best interests of that person and if that person or people around them feel the deputy is not quite doing what they should be doing, or if as a conflict of interest for any reason, an application can be brought to the court for that deputy to be removed and for another to be appointed in their place. Changing a deputy can be quite a lengthy process.
All parties have the right to make their submissions to the court and to be heard. And if there are conflicts, it could end up in a court hearing, so legal advice would have to be taken just to ensure the application is made correctly and in a timely manner.
What is a personal injury trust and what advantages are there of using one?
Well, personal injury trust is set up, usually, when somebody has just received compensation for a personal injury, it’s a bare trust. So, it’s the simplest kind of trust. Usually, two trustees would be appointed, and it can be the person who’s received the money and somebody else, like a family member. But the main purpose of putting funds into a personal injury trust is to protect means-tested benefits.
So, a compensation payment, let’s say you get £25,000. That’s a big lump of capital, which, if you are means tested by the DWP for some benefits like income support or housing benefit, that compensation can take you over the limit and you wouldn’t qualify for those benefits anymore, which can seriously prejudice quite a lot of people.
But if it’s in a trust, that personal injury award, then it’s not taken into account when assessing eligibility for means-tested benefits so that capital can then be called upon a year from now, two years from now, however far down the line. And I suppose the hope is that they would use it to purchase something important.
If it’s perhaps a car to help them get to wherever they need to go or anything like that. And it’s just quite flexible and can be changed over time. Some of the terms of the trust can be changed. But yes, the primary advantage of it is to protect means-tested benefits.
Okay. Thanks for clarifying that, John. Now a question for both of you. Tell us about an interesting or unusual case that you’ve worked on recently. Who wants to go first?
We did have one very interesting case whereby Martin was appointed as a panel deputy. So that is when a deputy can’t be agreed on by anyone close to the protected party. So, for the person who needs it, the court can appoint one for them. And Martin does get some very interesting cases through that. And with this particular person, we didn’t know too much about her, her background, or her finances.
So, it turned out she had quite the property portfolio that hadn’t quite been managed particularly efficiently for quite a while. And she also had pigeons living on the third floor of her house and various other critters as well. I think that’s probably the most polite way of saying it. So, she had pigeon friends taking up residence with her.
Most of the properties were not in a good state either. That was one that we had to be creative with for the various solutions that we were coming up with to try and fix some of the problems. This was because a few of the properties were tenanted as well and because of the terms of the order, they were quite specific decisions that needed to be made. So that was very much a multidisciplinary approach.
When it comes to the properties, the deputyship order itself doesn’t give us (the deputy), the authority to sell a property or to place a charge over the property to take a mortgage out. We’d have to go back to the court to make applications for that specific authority.
The reason is, interfering with someone’s property, whether it’s an investment property or their home, it’s part of their estate. And so, it will fall under their will at some point when they pass away. And so, the children, more often than not, will take issue with anything we might do with the property. So, we have to go to the court and say, why is this in that person’s best interests?
And in this particular case, some properties were in such bad states that they were almost unsafe to live in. And one of those properties was her main property. We couldn’t borrow against her property because it was in an un-mortgageable state. So, we had to try and make some funds available to renovate one of the other properties and then ask the court for permission to borrow some money against that property so that we could do up another property and kind of do that for several properties.
So, it was very complicated, and it ended up with Martin and I drafting the application and it took the whole day. Going over witness statements for a whole day and trying to make it all makes sense is quite tiring and quite time-consuming. But it’s part of what we must do. We can’t always just do whatever we want as deputy, there are things we have to do that we have to go back to the court for permission to do.
One case we’ve had recently is a gentleman who’s in a civil partnership, and his husband has now decided that he doesn’t want to be married anymore. And so, he served divorce papers on Martin as deputy. And so, we had to go back to the court, and we had to say, ‘Are we okay to act for this gentleman in the family court in these divorce proceedings?’ There isn’t much precedent for this kind of thing because what is the capacity to divorce?
What do you have to understand to be able to enter into a divorce? The idea is that, obviously, you’ll never be romantically linked with this person, and you won’t see them again theoretically. But then also there are financial issues. It’s the settlement that you have when you divorce. Our client can’t consent to any financial agreements severing their assets. And so, Martin has to get specific authority to do that.
So, it can be very wide-ranging, the various things we have to do.
I just wanted to add on there as well. With the capacity to divorce, it runs so close to health and welfare and social things as well, which, of course, Martin wouldn’t have the authority to deal with. So that’s where it comes in that we need to look to other people in social services for assistance.
Well, you learn, don’t you, by this case. I did ask for unusual cases for you to come up with, and you certainly did. Thank you for that. Very interesting. So, before we wrap up, John, just one final question. What is the difference between the Power of Attorney and deputyship?
So, in the Powers of Attorney and deputyship, the outcome is essentially the same in that a person is appointed to manage the affairs of somebody who does not have the capacity to make those decisions. However, a Power of Attorney is what we call a Lasting Power of Attorney these days. It’s authorised by the person in question, so I can make a Power of Attorney and appoint Eleanor as my attorney because I have the capacity to enter into that arrangement now.
I understand that it is a very important decision making and that the ramifications are quite severe. She can take ownership of my bank accounts and manage my affairs for me so I can make that decision because, theoretically, I trust Eleanor. But when it comes to deputyships, the person in question does not have the capacity to enter into any kind of arrangement like that.
And so the court has to be the one who makes the order appointing a deputy. So, it’s essentially, the person in question doesn’t necessarily choose who their deputy is, whereas they can choose who their attorney is. There’s also an accountability issue. An attorney under a Power of Attorney wants the Power of Attorney to be registered, it’s up to the attorney to do the right thing and to always act in the best interests of the donor.
And that sometimes can go quite wrong. And we sometimes take over cases where attorneys have been removed because they haven’t acted in that donor’s best interest, whereas a deputy is accountable to the court and the Office of the Public Guardian. And we submit reports every year which detail all the money that’s come into the estate and all the money that’s gone out.
And if things don’t match up or if the OPG thinks that we haven’t been doing our job properly, they can send somebody around and question us. For that to happen to an attorney, it requires the carers or other family members to blow the whistle and get in touch with the OPG, which sometimes they don’t do and sometimes they do.
A Power of Attorney is generally less expensive to set up, which is always why, you know, we encourage people to do them sort of at the same time when they do a will. It’s one of those things it’s just best to set up now and forget about. And so, you need it because going to court is more expensive.
And time-consuming as well.
Well, thank you very much, Ellie and John, thank you for joining me today. Giving up your time for this Warner’s Law podcast. Many thanks. So today, I was joined by Ellie Norman, a senior paralegal at Warners Law, and John McKenzie, a solicitor with Warner’s Law. And please do check out the other podcasts in this series and you can gain extremely good legal advice from other lawyers from the podcasts at Warners Law.
I’m Paul Harvey. Please join me next time.