ACC & Others  EWCOP 9
Her Honour Judge Hilder, Senior Judge of the Court of Protection, has handed down judgment in Re ACC & Others  EWCOP 9, a test case concerning the conflicts of interest that may arise where a solicitor property and affairs deputy instructs their own law firm to carry out acts or conduct litigation for the person who is the subject of the deputyship order (“P”).
The cases before the Court concerned three individuals, ACC, JDJ and HPP who each lacked capacity to (i) manage their property and affairs, and (ii) conduct litigation. Each had a deputy for property and affairs. None of the relevant deputyship orders contained any express provision either granting or excluding authority for the deputy to instruct solicitors or to conduct any kind of proceedings on behalf of P.
ACC’s deputy was the Irwin Mitchell Trust Corporation Limited (“IMTC”). IMTC sought advice and assistance from a legal team at Irwin Mitchell LLP regarding an appeal against the local authority’s decision to end ACC’s Education Health and Care Plan. The deputy then applied to the Court of Protection for retrospective authorisation of costs incurred.
JDJ’s deputy was a partner of Irwin Mitchell. JDJ’s parents wanted to appeal a decision made by the local authority about JDJ’s education. JDJ’s deputy made an urgent application to the Court of Protection for authority to appeal and to instruct Irwin Mitchell to provide legal representation and advice. The relevant education appeal process involved a tight timeframe, and Irwin Mitchell were instructed before the Court had determined the deputy’s application.
HPP’s deputy was IMTC. A personal injury claim was brought on behalf of HPP, who was represented by Irwin Mitchell in that litigation. A director of IMTC was appointed HPP’s litigation friend. IMTC applied to the Court of Protection for authority for the Senior Courts Costs Office (“SCCO”) to carry out a detailed assessment of the litigation friend’s costs.
The three cases were listed by the Court to be heard at a single hearing, to enable the Court to consider wider issues of costs and conflicts of interest in situations where property and affairs deputies instruct a legal firm (and / or litigation friend) with which they are associated. Additionally, the applications raised the question of whether it is within the scope of a property and affairs deputy’s general authority to instruct solicitors and conduct litigation on behalf of P.
The Official Solicitor was appointed to act as litigation friend of ACC, JDJ and HPP. The Public Guardian (“the PG”) was also joined to the proceedings, his duty to supervise deputies making him an interested party.
HHJ Hilder identified nine questions arising from the applications before her:
1. What authorisation is required to conduct litigation on behalf of P?
2. What about further proceedings in the Court of Protection?
3. To what extent does “general authority” encompass authority to take legal advice on behalf of P?
4. Where is the line drawn between seeking advice and conducting litigation?
5. What about urgent matters?
6. How should conflicts of interest be addressed?
7. What about cases where the deputy is not the instructing party?
8. What about acting as litigation friend?
9. What if P has capacity to give instructions for the work in question?
The judge’s conclusions on these issues were as follows:
• The “general authority” conferred upon a property and affairs deputy does not include authority to conduct litigation on behalf of P.
• In respect of proceedings in the Court of Protection, a property and affairs deputy may make an application to the Court in respect of property and affairs issues without a prior application for authority to do so. However, that deputy does not have the same authority to conduct other proceedings. If a health and welfare issue arises, the deputy should bring the need for welfare proceedings to the attention of the Court and seek further directions, rather than initiating those proceedings him or herself.
• “General authority” does not extend to routine non-contentious legal tasks as a matter of course. However, a property and affairs deputy’s authority to do an act on behalf of P includes such ordinary legal tasks (short of taking proceedings) as are ancillary to giving effect to that exact authority. For example, preparing a tax return is an ordinary part of managing property and affairs, therefore it is within the general authority of a property and affairs deputy. Seeking advice from a tax expert about how to complete the tax return, or delegating the preparation of the tax return, may be an appropriate step within the general authority of a deputy.
• “General authority” may also include authority to take some legal advice in respect of some contentious litigation. Again, a distinction must be drawn between the contemplation of litigation in the realm of property and affairs, and the contemplation of other litigation. The latter is unlikely to fall within the general authority of a property and affairs deputy, and so would require specific authority from the Court. Even in the case of property and affairs litigation, a deputy would only be permitted to go as far as writing a Letter of Claim and receiving a Letter of Response before requiring specific authority to proceed further.
• Where matters are so urgent that authority to litigate cannot reasonably be obtained before taking action to protect P, the deputy proceeds initially at his own risk as to costs, but may make an application to Court for retrospective approval and authority to recover costs from P. There is no presumption that such an application will be granted.
• The judge declined the Applicants’ invitation to prescribe an annual limit up to which a property and affairs deputy acting under a standard deputyship order could incur legal costs without further Court approval. However, she provided guidance on the required approach to addressing conflicts of interest. This included the following:
o A proposed property and affairs deputy should consider, when seeking appointment, whether there is a realistic prospect that they may wish to instruct their own firm in relation to legal tasks raised by the deputyship and, if there is, they should seek specific authority to do so within the deputyship order;
o In other cases where a property and affairs deputy wishes to instruct his own firm to carry out legal tasks, the deputy must (i) obtain three quotations for the work proposed (including one from the deputy’s own firm) (ii) make a best interests decision as to which of the providers to instruct (properly documenting the decision-making process) (iii) if the anticipated costs exceed £2,000 + VAT, apply to the Court for specific authority to incur the costs; and (iv) set out legal fees so incurred in the annual account submitted to the PG by the deputy.
• Specific authority is required for a property and affairs deputy to use P’s funds to pay a third party’s costs, even if that third party is a family member.
• If P has capacity to give instructions on a particular matter, he or she will also have capacity to agree the costs of that matter.
• The Official Solicitor extended an offer to act as litigation friend to P without charge in any case where her usual criteria for appointment are met. In view of this, HHJ Hilder did not address the question as to whether a different litigation friend may charge for acting as such.
The judge helpfully included a summary of her conclusions as an appendix to her judgment. The judge made the orders sought in all three of the applications before her, but warned that nothing in her decision should encourage property and affairs deputies to consider that future applications to authorise litigation after the event will achieve a similarly positive result. The judgment makes clear that there is a continuing expectation that deputies will consider in detail the limits of their own specific authority and address any potential conflicts of interest with each step that they take.
To see a copy of the judgement please click here