Last week saw the publication of Senior Judge Hilder’s review of the appointment of trust corporations to act as a property and affairs deputy for a protected party, and in particular what information is necessary for the Court to be satisfied that a trust corporation is a fit and proper person to be appointed as deputy. The background to the case has been the growing trend of solicitor’s firms establishing trust corporations to be appointed as deputy, instead of those appointments being taken in the personal name of a senior member of staff as had been the usual practice in the past. This case follows the recent decision in the case of Matrix Deputies, where a trust corporation admitted breaching their fiduciary duties.

The Mental Capacity Act 2005 (MCA) allows for the appointment of a trust corporation as deputy. Such an appointment can have advantages for P such as continuity, availability and professionalism. Where the deputy is a trust corporation P will avoid the costs of appointing a new deputy when an existing deputy retires. A trust corporation appointment ensures that there can always be a decision maker available avoiding delays when a personally appointed deputy is on holiday or ill for example.

The case took evidence from eleven trust corporations, the Office of the Public Guardian (OPG), bond providers and the Solicitor’s Regulatory Authority (SRA). The issues addressed included whether a Trust Corporation can lawfully act as deputy, internal management supervision and external regulation other than that of the OPG.

Having examined these areas Senior Judge Hilder sets out in Schedule 2 to the decision the information that the Court requires to be satisfied about appointing a trust corporation. This includes:

  1. That the trust corporation can lawfully act as such and will notify the OPG if this ceases to be the case;
  2. Confirmation that the trust corporation will comply with the OPG standards for professional deputies;
  3. The trust corporation is either SRA regulated or that all directors are solicitors and the trust corporation has no employees (save for a company secretary); and that it will retain its associated legal practice for the managements of P’s finances and affairs and also that the trust corporation is covered by the professional indemnity insurance of the related legal practice.
  4. If there is any change to the information in number 3 then the trust corporation must notify the OPG immediately;
  5. The trust corporation (or its associated legal practice) must undertake to maintain insurance cover for the work of the trust corporation that meets the SRA minimum terms and conditions; and
  6. The trust corporation will lodge a copy of the insurance with the Public Guardian and will update him immediately if there is any reduction in cover.

The case is a useful round-up of the regulatory and management matters surrounding the appointment of a trust corporation associated with a legal practice and clarifies the Court’s thinking when approaching these appointments.

Mention is also made of those trust corporations which are regulated by other bodies (such as charities and banks) and trust corporations which are formed by businesses with no outside regulation at all. In these cases when an appointment is next sought the OPG may be approached for a report and the Court is also reminded of the (non exhaustive) list of factors to consider when appointing a deputy for P.