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Thomas Mundy

Email: thomas.mundy@wrigleys.co.uk

Telephone: 0114 267 5588

Position: Solicitor

Can deputyship appointments be inherited by successive office holders of approved organisations?

A qualified person can be appointed as deputy for property and financial affairs by virtue of holding an office in an approved organisation. The appointment will continue even if the office holder is replaced by another person. The Office of the Public Guardian should be informed of a change in office holder or other relevant circumstances.

Background

An application was made for the Head of Business Development and Client Finance of Focus Independent Adult Social Work (Focus) to be appointed as property and financial affairs deputy for SH. SH was seventy-one years old at the time of the application and lacked capacity to manage her property and affairs due to a persistent delusional disorder. Evidence surrounding SH’s lack of capacity was not disputed. SH had one son, MH, who was notified of the proceedings but played no part in them.

SH’s assets were modest (totalling less than £10,000). Her only source of income at the time of the application was her state pension.

The application sought the appointment of the Head of Business Development and Client Finance, rather than a named person. The application form was signed by Miss Sarah Hawker (the current Head of Business Development & Client Finance).  The COP4 declaration accompanying the application also gave details of and was signed by Miss Hawker.  Miss Hawker changed her name to Mrs Savage during the application.

The Court was initially sceptical of the application and asked the Public Guardian to address the following:

– Whether Howdens (the Court’s bond provider) had satisfied themselves that Focus was a suitable organisation to be bonded;
– Whether the way Focus was formed empowered them to carry out the functions of a deputy;
– Whether Focus had sufficient insurance in place to act as deputy in this case and any other cases Focus was dealing with;

The Public Guardian’s answers to the above did not placate the Court.  Following further statements by the Applicant and Public Guardian, Her Honour Judge Hilder initially identified that there would appear to be

– No advantage over the appointment of an office holder versus a named individual, and;
– A lack of transparency of who is actually acting as deputy at the time of the appointment and subsequently.
An attended hearing in front of HHJ Hilder resulted in the Applicant and the Public Guardian filing further submissions. Their respective positions were as follows:

The Applicant’s position

The deputyship work Focus managed was previously administered by North East Lincolnshire Council. Sarah Savage herself was previously part of the council’s deputyship team which had subsequently restructured.  As a result, Focus was launched as a separate entity to become a community interest company limited by guarantee.

Focus was to take on the functions of deputy appointments still in the name of the authorised officer North East Lincolnshire council.  Focus was, for all intents and purposes, acting as the local authority deputy.  The bond provider began to require bonds to be taken out in the name of ‘Head of Business Development and Client Finance” so Focus began to seek the appointment in those terms.

Focus was not a regulated entity and the holder of the post of Head of Business Development and Client Finance need not be a regulated professional. Focus complied with the Office of the Public Guardian’s professional standards requirements and was audited by North Lincolnshire Businesses Connect. It is also a member of the Association of Public Authority Deputies. Focus felt it “should be treated as part of the public authority”.

The Applicant claimed that the Court could and should appoint the holder of a specified office as deputy and that any subsequent change to the holder of the position will not affect the deputyship appointment.

The Applicant appreciated that a change in office holder might affect the Public Guardian’s assessment of risk and did not object to having to notify the Public Guardian following a change. Any future post holder would likely have similar qualities and experience to the current post holder. As such, the Court would likely be satisfied of any suitability. A requirement for a formal application to the Court would only add cost for the protected person without adding any real benefit.

The Applicant initially maintained that it was within their powers as a company to act as deputy and that the Public Guardian had confirmed satisfaction with their insurance cover.  It subsequently transpired that the Applicant would not be covered for any error or omissions in respect of investments of client’s funds.

Public Guardian’s position

The Public Guardian did not object to the individual appointment of Sarah Savage in a personal capacity. He did however object to the appointment of the office holder without specifying the name of the individual holding such post at the time of appointment.

Appointing an unnamed office holder would deprive the Court of the opportunity to make a best interest decision on who the new deputy should be, if or when the current post holder leaves.
The specific requirement to return to Court if the office holder at the date of the appointment ceased to hold that office would diminish the Public Guardian’s concerns.  This would however have a financial impact on P. The Public Guardian was satisfied in taking a supervisory role and to be informed on any subsequent change of office holder. If the Public Guardian felt it appropriate they could then refer the matter to the Court of Protection.

The Public Guardian suggested that the Court should take into account the limits of that company’s professional indemnity insurance when determining the level the bond should be set at.

Outcome

Following submissions by the Applicant regarding the drafting of the Mental Capacity Act 2005, HHJ Hilder interpreted section 19 (2) of the MCA 2005 as allowing an office holder to be appointed as deputy.  That appointment should remain affective when the office holder at the date of appointment is replaced. The Court agreed with the Public Guardian’s concerns about the need to consider the suitability of successive office holders.  The proportionate way to do this was part of the Office of the Public Guardian’s ongoing supervision requirements.

HHJ Hilder was satisfied that Focus was a suitable organisation and the current holder of the Head of Business Development and Client Finance was a suitable person to be appointed as property and affairs Deputy for SH. The appointment included provision for remuneration of Focus at the public authority rate.

The appointment was to continue with successive holders of the office. The Order specifically included the requirement that:

“…the holder of the post of Head of Business Development and Client Finance at the date of the appointment notifies the Public Guardian forthwith if:

(a) She ceases to hold that post; and/or
(b) There is any change to the competence of Focus IASW to carry out the function of Deputyship by variation of its articles association or otherwise.”

The Court was concerned that sufficient professional indemnity insurance was not in place and set the level of the security bond to that of SH’s known assets. No order for costs was made due to an agreement between the parties to bear their own costs.

Focus’ articles associations did not specifically provide for acting as deputy. The Court felt that it was not the appropriate place for a determination of matters of company law and therefore required Focus to confirm by way of a statement that it did have the authority within its articles association to act as deputy.

Comment

Following submissions by the Applicant regarding the drafting of the Mental Capacity Act 2005, HHJ Hilder interpreted section 19 (2) of the MCA 2005 as allowing an office holder to be appointed as deputy.  That appointment should remain effective when the office holder at the date of appointment is replaced. The Court agreed with the Public Guardian’s concerns about the need to consider the suitability of successive office holders.  The proportionate way to do this was part of the Office of the Public Guardian’s ongoing supervision requirements.  The office holder was ordered to inform the Public Guardian of any change in the position or the competencies of the company.

This approach offered advantages of transparency “because in any organisation, it should be clear at any given time who holds the relevant office, and therefore who discharges the function of deputyship”.

It is interesting to note the position of the Court that where insufficient professional liability insurance is in place, the deputy will be bonded at the same rate as a lay deputy.

The outcome of this approach will hopefully be that P’s estate is not subject to the unnecessary costs of making additional applications to the Court of Protection in similar circumstances in the future. Saving costs to P was clearly important in the Court’s reasoning however It might be that in higher value cases, the Court take a different approach.

 

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