When is a deputy appointed?
In short, the Court will appoint a deputy if a person (in this theoretical example an elderly relative) loses the capacity to manage their property and affairs and / or make personal welfare decisions. A deputy is usually only appointed should the person who has lost capacity have not made an Enduring Power of Attorney or Lasting Power of Attorney previously (although this does not necessarily prohibit the appointment of a deputy if it is thought to be in the person’s best interests to change the Attorney).
There have been a lot of “horror” stories in the press and on television shows (such as The One Show) over the past two or three years in relation to the appointment of a deputy. In practice, it is not as problematic as the media have made out although undoubtedly the easier option is for the person who lacks capacity to have already made a Lasting Power of Attorney. Our advice to all clients is to make a Lasting Power of Attorney so that you can retain your own autonomy in who you appoint to look after you affairs should you not be able to. However, the following is a summary of some of the applications that can be made to the Court of Protection and the likely cost and time scale involved in doing so.
The appointment of a deputy
- Time scale
Q: Time scale
The appointment of a deputy is a fairly lengthy process. The first thing that can delay matters is the need for medical evidence from a medical professional stating that the person in question lacks the capacity to manage their own affairs. Once this is obtained (and this can be at a cost) then the application to Court can be made. From experience, and unless there are grounds for an expedited application, the Court will usually take at least three months to issue an Order allowing the deputy to act.
The application itself attracts a number of fees. The first is the application fee to the Court itself which is £400. Once a deputy is appointed there will also be an appointment of deputy fee owing to the Office of the Public Guardian (OPG) of £100.
A deputy has to take out an insurance policy over their actions as deputy. The level of security for the insurance premium is set by the Court. It is usually based on a figure that is two thirds of the incapacitated person’s total assets. As an example, if an elderly relative had total assets worth £500,000 the typical annual insurance premium payable by the deputy (using the incapacitated person’s funds) would be £660.
A supervision fee is also payable to the OPG each year of £350.
Finally, the application would attract legal fees. The Court allow for a fixed fee of £850 plus VAT. This is the absolute minimum the application would cost. More realistically, we find that these applications attract fees on average between £1,200 and £1,500 plus VAT.
Statutory Wills and Gifts
The Court of Protection have the power to make a brand new Will for somebody who lacks the capacity to do so themselves or alter an existing Will they have already made. They also have the power to order that gifts can be made from a person’s estate for, for example, Inheritance Tax purposes.
These are possibly the most difficult and most expensive of all of the applications to Court. They will almost certainly involve the appointment by the Court of someone called the Official Solicitor to effectively act as a referee and represent the interests of the incapacitated person. The Official Solicitor’s involvement increases the cost of these applications and inevitably adds to the time scale.
- Time Scale
Q: Time Scale
Realistically, and unless there are grounds for expediting the application (which would involve medical evidence saying that the person who lacked capacity was at risk of passing away) these applications will take at least four months and sometimes longer depending on complications and whether the application is contested by any other party who is adversely affected. As an example, anybody who was named in an existing Will would be joined as a party and given the opportunity to make their own representations if their entitlement under the Will was proposed to be altered.
This depends on the complexity of the application and, as above, how contentious it becomes in terms of a contested hearing. At the bare minimum, legal fees for applications of this nature would be £3,000 plus VAT. There would also be the application fee payable to Court of £400 and the Official Solicitor’s fees which typically would be around £1,000 to £1,500 plus VAT. The actual costs can be much greater than this should the matter become problematic.
Contested Applications to Court
We often find that relatives will complain about an Attorney (who is acting for an elderly relative) stating that they are unsuitable for the position and / or that they are taking advantage financially of the elderly client. We are also consulted when relatives have been notified of an application by somebody else to be appointed as deputy for an incapacitated relative who they feel is unsuitable to carry out the role.
In these circumstances it is prudent to take legal advice as to whether to make an objection to these people acting.
We find that clients are often put off by the perceived costs to them with an application such as this. However, if we consider the objection to be valid it is highly likely the Court will make a final Order stating that the objector’s costs are paid from the estate of the incapacitated person or, in more extreme circumstances, by the party who has made the application in the first place if they have been acting unethically.