By Philip Warford

“My mother is becoming really forgetful, I think she might have dementia.”  Words that might strike fear into the heart of any adviser, especially if you are mid-transaction.  But what does that really mean to you?  And what are your options?

The Mental Capacity Act

It’s extremely important to have an understanding of the Mental Capacity Act (MCA) 2005 when, as a professional, you are put in this type of situation. The MCA applies to everyone involved in the care, treatment and support of people aged 16 and over living in England and Wales who are unable to make all or some decisions for themselves.  Our previous blog on Mental Capacity – supporting your clients to make decisions, outlines the key principles of the MCA and this can be viewed here.

What are you trying to achieve?

Our starting point is always to consider what exactly you are trying to do, in other words, what are the decisions your client needs to make?  This is reflected in the MCA by saying that the consideration of mental capacity is transaction and time specific.  If your client does not have the mental capacity to deal with the transaction in hand then we need to consider the options available to you, most likely, seeking assistance from the Court of Protection.

At this point it might also be useful to remind you that if your client does have mental capacity right now then it would always be prudent to recommend that your client puts in place Lasting Powers of Attorney. This is always going to be quicker, simpler and cheaper than going to the Court of Protection.

It’s important to note that a Lasting Power of Attorney cannot be made on behalf of someone.  A person must have the mental capacity to make their own Lasting Power of Attorney.

The Court of Protection

If your client is not able to make a Lasting Power of Attorney and there is a need to make decisions on behalf of your client then there is likely to be no other option but to apply to the Court of Protection – “The Court of Protection in English law is a superior court of record created under the Mental Capacity Act 2005.  It has jurisdiction over the property, financial affairs and personal welfare of people who it claims lack mental capacity to make decisions for themselves.”

So what’s the process?

The Court of Protection process may not be as onerous as some people think.  The Courts’ procedure is very prescriptive with defined time scales.

You might need to consider applying to the Court for a one off decision or, more commonly, for the appointment of someone to act as a Deputy for your client.  A Deputy is a person appointed by the Court to take decisions on behalf of a person who cannot make decisions for themselves.

Where do you start?

The starting point is to seek an assessment that your client does not have the mental capacity to make decisions for herself.  The Court needs this as it has to be sure that your client does not have capacity before it does anything.

The assessment can be from a number of professionals including medical practitioners, nurses, occupational therapist and a social worker.

You then put in your application to the Court for what you need, i.e. what are you asking the Court to give you permission to do?

The Court considers your application.  If it is satisfied that your application should proceed, there is a process of notifying certain people linked to your client.  The purpose of this is to give someone who knows your client the chance to have a say on your application proceeding – rather more so to say that the person applying to be the Deputy is not an appropriate person to act.  The people who are notified are, usually, close relatives.

When this all goes through, the Court will make the Order in favour of the Deputy.  If it relates to the appointment of a Property & Affairs Deputy then there will also be a need to take out a kind of insurance policy based on the risk of the Deputy running off with your client’s money.

As regards to timescale and costs, if we use a Property & Affairs Deputy Order as our example, it usually takes around 6 months for this to come through (from the time the process is started by sending the assessment and application forms to the Court) and the application fee is £400.

What’s your position if you fail to ignore what your client’s daughter says to you?

One important point to remember with all of this is that if you proceed with decision making, without considering your client’s mental capacity, and it is later found that your client did not have capacity at the time the transaction took place, the transaction could be void or voidable.  And the result of this is – you may end up getting sued!  A scary prospect, so it’s extremely important to have an understanding of each individual client and their circumstances.

If you would like to discuss a specific client’s situation in confidence or would like some advise about applying to the Court of Protection for a particular client, please do not hesitate to contact us.

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