Advising Deputies and Attorneys

The main duty of a Deputy is to safeguard the individual's assets and meet their day to day financial needs.  The Deputy will work closely with the family and other professionals such as financial advisors and case managers.

The Deputy must always keep the Mental Capacity Act 2005 in mind when making decisions.  A key principle of this Act is that the individual is presumed to have capacity unless proved otherwise and must be consulted in all decision making.

We can assist you with ensuring you comply with your duties and obligations as a Deputy or Attorney.

Our top tips include:

1. Attorneys/Deputies should keep the incapacitated person (P)’s monies separate from their own or anyone else’s. As well as being completely transparent, it does assist with completion of the Deputy Return.

2. Investments should be made in P’s name, with the Attorney/Deputy noted as a signatory.  If for some reason it is not possible to be made in P’s name, the Attorney/Deputy should execute a Declaration of Trust or some formal record acknowledging beneficial interest in the assets.

3. You must make an application to the court if you wish to carry out any of the following:

a. Gifts that exceed the Authority given by the Order appointing you as a Deputy or for Attorneys the authority contained in section 12 of the Mental Capacity Act (MCA) - this basically covers small gifts on customary occasions and gifts to charities. 

b. Loans to the Attorney/Deputy or to members of the Attorney/Deputy’s family.

c. Any investments in the Attorney’s/Deputy’s own business.

d. Sales or purchases at an undervalue.

e. Any other transactions in which there is a conflict between the interest of P and the Attorney/Deputy.

4. Be aware of the law regarding your role and responsibilities.  Ignorance of the law is no excuse for misconduct.  This involves awareness of the MCA and Code of Practice.

5. Be aware of the terms of your appointment and any restrictions.  For example are there any restrictions in the Lasting Power of Attorney (LPA) or for Deputies in the Order appointing you.  For example some Deputies will not be given authority to sell P’s property without further application to the court.

6. Take proper advice regarding investment of P’s assets.  Have regard to the Trustee Act 2000 which sets out the standard investment criteria and the obligation to take and consider proper advice.

7. When taking advice regarding investments be clear about budgets for the short, medium and if necessary long term.  Know what you are likely to need to spend and when.  This is not an exact science but it is helpful to provide your advisor with a list of income and general expenditure to ensure that appropriate recommendations can be made.

8. Do check whether P was preparing Tax Returns and/or whether they will be required to now.  Penalties will be payable in respect of late returns and late tax.

9. Do consider a Statutory Will for P especially if P’s Will is outdated or there is no Will in existence and the intestacy rules will bring about undesired results.

10. Remember that you are not entitled to see P’s current Will just by virtue of your role as Attorney/Deputy. You will need to make an application to the court for disclosure.  It is sensible for deputies to include this in their initial application to become appointed.

11. Do try to encourage P to make decisions for themselves to the extent that they are able.  Take into account that even if they cannot make big decisions about their property affairs they may be able to make some decisions.  Remember that individuals are entitled to make what you may feel are bad or unwise decisions as long as they have the requisite capacity.

12. Remember that your authority as Attorney/Deputy generally does not give you authority over any of P’s Trustee functions.  The law in this area is complex.  It is possible to execute a Trustee Power of Attorney but this will end if P loses capacity.  It is important to consider the Trust Deed carefully and an application to court may be necessary for P to be removed.   This also includes any property where P is a joint owner.  It is a good idea to take advice in respect of this.

Solicitors

Holly Algar
Associate
Private Client
Southampton
023 8082 0515
Private Client

Paralegals

Rachel Kent
Paralegal
Private Client
Salisbury
01722 426991
Private Client