COURT OF PROTECTION: An Introduction

Contributed by David Rees QC, 5 Stone Buildings 

Change is afoot in the Court of Protection hierarchy. Sir James Munby, the President of the Family Division and Court of Protection, retires in July 2018 after five and a half years in that role. He will be succeeded by Sir Andrew McFarlane. The Vice-President of the Court, Mr Justice Charles, retired in February 2018. Mr Justice Charles was a member of the committee that drew up the original Court of Protection Rules in 2007 and has chaired the successive ad hoc Rules Committees since that date. His final contribution was the introduction of the Court of Protection Rules 2017 and accompanying practice directions in 2017. He will be a hard act to follow and his successor has yet to be appointed. Two other judges with considerable Court of Protection experience have been elevated to the Court of Appeal; Lord Justice Peter Jackson was appointed to the Court of Appeal in October 2017 and he will be joined there by Mr Justice Jonathan Baker later in 2018.

For the second year in a row, there has been a noticeable drop in the number of reported Court of Protection cases (27 were published on BAILII between July 2017 and June 2018 as opposed to 38 in the previous year and 74 in 2015/16). Most of these judgments relate to welfare matters and there have been fewer than half a dozen reported property and affairs judgments in the past year. Nevertheless, although few property and affairs cases are reported, it should be borne in mind that these continue to make up by far the largest part of the Court’s workload; 48% of the record 8089 applications received by the Court between January and March 2018 sought the appointment of a property and affairs deputy.

The reasons for the fall in the number of reported cases is not entirely clear; however, in part, it may relate to the rule changes first introduced on a pilot basis in December 2016. These provide for most contested property and affairs applications (particularly LPA and deputyship disputes) to be listed before a judge at an early stage for a without prejudice dispute resolution hearing with a view to seeing whether the case is capable of resolution. This rule change appears to have been successful in its aim of reducing the number of property and affairs cases that come to a final hearing, and has now been placed on a permanent basis by the Court of Protection Rules 2017 and the accompanying practice directions.

A number of the property and affairs judgments that have been published in the past year have touched upon the appointment of professional deputies and the basis upon which they may be remunerated. Applications for the appointment of a trust corporation as a property and affairs deputy have become increasingly common, particularly from solicitors’ firms. Such appointments offer advantages for both the incapacitated person and the deputy’s firm. The appointment of a trust corporation affords flexibility, meaning that decisions do not all have to be taken by a single designated fee earner, making it easier to ensure that the incapacitated person’s affairs are not inconvenienced by the deputy going on holiday, falling ill, taking maternity leave, or retiring. They also offer the opportunity for greater internal controls and protections, for example, the appointment of a trust corporation as deputy can ensure that transactions above a certain value have to be authorised by two directors.

However, notwithstanding these advantages the Court of Protection had adopted a practice of making appointments of trust corporations as deputies limited in time (usually for a year), as it had concerns about their insurance and regulatory position. Eventually 36 such cases involving 11 different solicitor-owned trust corporations were listed for hearing together before Senior Judge Hilder. In her judgment (Re Various Incapacitated Persons and the Appointment of Trust Corporations as Deputies [2018] EWCOP 3) the Senior Judge recognised that the decision to appoint a trust corporation as deputy was a best interests decision to be taken having regard to section 4 of the Mental Capacity Act 2005 checklist on the facts of each individual case. She also accepted that the Court should not seek to impose standard working practices on all trust corporations, and annexed to the judgment a short additional form which should be completed by all trust corporations seeking appointment as a property and affairs deputy. This form provides the Court with the information that it needs to be satisfied of the trust corporation’s regulatory and insurance position. A further decision that will also be of interest to solicitor deputies is the decision of Mr Justice Charles in Re AR [2018] EWCOP 8 which examines the basis upon which a solicitor deputy can be authorised to charge in low value estates.

Sadly, but perhaps inevitably, financial abuse continues to be an ever present element of the property and affairs part of the Court of Protection’s jurisdiction. In media interviews in August 2017 the retired Senior Judge of the Court of Protection, Denzil Lush, highlighted the risks of financial abuse, particularly in relation to enduring and lasting powers of attorney. However, there is evidence that these risks are being taken seriously and addressed. The most recent Public Guardian report shows that in 2016/17 the Public Guardian received 5,327 safeguarding referrals which led to 1,266 formal investigations (a 15% increase on the previous year) and 272 applications to the Court of Protection.

Finally, whilst not a Court of Protection case, the March 2018 decision of Mr Justice Morgan sitting in the Chancery Division in the case of ET v JP and Others [2018] EWHC 685(Ch) is also worthy of note to property and affairs practitioners. This judgment considered the inter-relationship between the respective roles of the Chancery Division of the High Court and the Court of Protection when dealing with applications under the Variation of Trusts Act 1958. The judge held that where a variation needed to be approved on behalf of a child who would lack capacity under the Mental Capacity Act 2005 upon attaining the age of 18, the approval could be provided by the High Court alone without the need to involve the Court of Protection.