New guidance for deputies

Re ACC and Others [2020] EWCOP 9

The senior judge of the Court of Protection (COP) issued a judgment on 27 February 2020, called ‘ACC and Others’ which will affect the way in which deputies should act. The Office of the Public Guardian (OPG) expects deputies to comply with this new guidance by 1 April 2021.

The judgment provided helpful guidance on two key issues:

1. managing conflicts of interest that may arise where a solicitor property and affairs deputy instructs their own law firm to carry out acts or to conduct litigation for the person who is the subject of the deputyship order (P); and
2. which legal costs fall within the deputy’s general authority and which do not?

1. Managing conflicts of interest

The court provided the following helpful guidance on how to manage conflicts of interest.

Where a property and affairs deputy wishes to instruct his own firm to carry out legal tasks, the deputy should follow the below steps to address the conflict of interest:

1. When seeking appointment, a prospective professional deputy (PPD) should consider whether there is a realistic prospect that they may wish to instruct their own firm to carry out legal tasks. If so, they should seek specific authority to do so within the deputyship order;
2. In considering whether to instruct their own firm, a PPD should consider whether their firm does provide the service that is likely to be required. If so, the PPD should then include in the COP1 application a request for specific authority to instruct his own firm (subject to a specified limit as to costs);
3. When considering the application, the judge will make a decision about whether or not it is in P’s interest, the period in which the authorisation may be exercised, and the limit on the level of expenditure;
4. If the anticipated costs exceed £2,000 plus VAT, the deputy must seek prior authority from the court;
5. The deputy should set out the legal fees incurred in the annual account submitted to the Public Guardian.

Where a deputy is seeking advice / ordinary legal tasks which fall within a deputy’s authority, but no specific authority to instruct a deputy’s own firm has been granted, a deputy must follow these four steps:

1. Obtain three quotations for the work from legal services providers and one of these may be from the deputy’s own firm;
2. Make a best interests decision as to who to instruct and document the decision-making process;
3. If the decision is to instruct the deputy’s own firm and the anticipated costs exceed £2,000 plus VAT, make an application for specific authority; and
4. Set out any legal fees incurred to the Public Guardian and append the notes of the decision making process.

2. Which legal costs fall within the deputy’s general authority and which do not?

General authority: Within the authority of property and financial affairs deputies, it was confirmed that the ‘general authority’ granted by the standard deputyship order includes ordinary ‘non-contentious’ tasks which are required to administer P’s estate efficiently, in particular:

• property conveyancing;
• managing leases;
• business and associated employment contracts;
• preparing tax returns;
• taking advice on tenancy liabilities; and
• arranging care.

Outside the general authority: It was confirmed that specific authority is required to:

• conduct litigation on behalf of P, except where the contemplated litigation is in the COP in respect of a property and financial affairs issue; and
• use P’s fund to reimburse a third party instructed to act on behalf of P (even if that third party is a member of P’s family).

A clear warning on litigation costs

The court also provided a clear warning in respect of applications to authorise litigation after the event:

‘Nothing in this decision should encourage property and affairs deputies to consider that there will be on other occasions a similarly positive determination of applications effectively to authorise litigation after the event… Appropriate authorisation should be secured in advance’.

Effectively, unless there is good reason, deputies must seek approval in advance of litigation or otherwise they may risk being unable to seek retrospective approval and potentially become personally liable for those costs.

Overall implications

The judgment confirms that there is a continuing expectation that deputies will thoroughly consider the limits of their own specific authority and to address any potential conflicts of interest in the way prescribed by the court.
A key implication of this judgment is that it is likely to invite a flurry a new applications to ratify historic decisions on costs which will cause further delay at the already over-stretched COP. The court’s current ability to deal with urgent applications is already under a great deal of pressure and it is currently struggling to meet its own timescale of five working days to deal with urgent applications.

Further guidance

Further guidance has been produced by a group of practitioners from the Law Society, Solicitors for the Elderly, the Court of Protection Practitioners Association, STEP and the Professional Deputies Forum – please see link here. On page 4 of this guidance, there is a helpful flowchart to assist practitioners when navigating these new requirements for deputies.