Deputies – Property and Financial Affairs
In this case the District Judge had to consider a “bulk application” for approval (retrospective and prospective) of its charges for deputyship functions.
The long and impressively detailed judgment reveals a muddle. The Friendly Trust (‘TFT’) is a charity that, amongst other functions, takes on the role of deputy of small estates especially where the relevant local authority wants to outsource such work.
It seems, though much judicial digging was needed to establish this, that TFT had been charging at least in some cases the fixed charges that solicitors can charge under PD19B rather than the lower fixed charges allowed to local authority deputies. It also seems that officers in the OPG may have allowed that practice to persist.
Section 19(7) MCA provides for a deputy’s remuneration. He is allowed reimbursement of reasonable expenses and, if the court so directs, remuneration out of P’s estate for carrying out deputy functions.
Rules 167 and 168 make further provision. The court can fix an amount (rare), allow a specified rate, fix fees according to a schedule in a practice direction or order a detailed assessment (usually reserved for larger or more complex estates).
PD19B makes yet further provision. It provides for fixed fees for solicitors and lower fixed fees for public authority deputies. It also provides that solicitors have no right to a detailed assessment unless the court so orders and public authorities have none unless the estate is worth over
£16,000. From February 2011 the PD included a paragraph that specifically dealt with not for profit deputies and other professionals, stating that the court could apply its provisions to them.
Thus, if the order appointing the deputy is silent as to remuneration, the deputy is entitled to none. Some of the orders in this case were in this form.
Some of the orders simply provided for fixed costs. The District Judge stated that orders should specify the rate (solicitor’s or public authority’s), see 93 (e) unless the appointee is a solicitor or a public authority.
Where the order is silent or in relation to new orders and the appointee is not a solicitor but is taking over public authority work (as here) the starting point is that the rate is that allowed to public authorities, see 94 (a) to (c) as P should not put at a disadvantage because of a local authority decision to outsource work, but the appointee can apply for a higher rate with suitable justification, see 93 (d).
The District Judge also considered the question of accountants, saying that where they are appointed, the appropriate fixed fees are likely to be those of a solicitor with the right to seek an assessment. It is interesting to note at this point that in the SCCO report it was revealed that accountants’ bills were usually lower than solicitors’ because of lower charging rates and a greater propensity to delegate.The District Judge then considered individual cases. In relation to prospective charging in new cases, he ordered fixed fees on public authority rates with, in a few cases, the right to seek a detailed assessment.
In relation to existing cases, he made preliminary orders. Where there had been no provision for remuneration, he proposed an amendment to allow remuneration at public authority fixed rates. Where the appointing order allowed fixed fees but did not specify which, he proposed an amendment to clarify that the rate was that of a public authority. In such cases, if that meant there had been an overcharge, he directed TFT to quantify the excess and state why the excess should not be repaid.
In some cases, the appointing order allowed a detailed assessment. The District Judge expressed the view that such a provision may or may not be appropriate.
Finally, at 132, the District Judge emphasised that the original “bulk application” which envisaged a paper disposal by an authorised court officer without individual notification was inappropriate (although this had been at the OPG’s suggestion and the ACO had also acceded to the view that notification was unnecessary). He considered that as the Ps’ estates stood to be affected, it was necessary that each affected P be notified to comply with section 4 MCA and the rules of natural justice.
This case underlines the need for the appointing order to be clear about remuneration and the approach that the court is likely to take to cases where remuneration is sought above public authority rates in out sourced cases, namely that
P should be at no disadvantage. It also presages an amendment to PD19B which will expressly state that in respect of out sourced deputyships, it is expected that no more will be charged than if the public authority had carried out the work.
In the case of professional guardians holding five or more financial guardianships, in future the Office of the Public Guardian will no longer undertake a full annual account review in every case. Instead, random samples will be selected. If the outcome of the audits of these is satisfactory, for all other guardianships and other years the Office of the Public Guardian will accept a covering one-page summary sheet only.