OPG v DJN

In this case, the Office of Public Guardian applied to the Court of Protection to revoke a Lasting Power of Attorney that had been made by P, which appointed his son (DN) as his attorney. He subsequently lost capacity and concerns were raised as to whether or not P had the appropriate level of capacity at the time it was prepared. It had been investigated and concerns were raised that DN had not acted in the P’s best interests by selling his residence and transferring the majority of the proceeds to himself and mixing the finances by operating a joint account.

In December 2017, a district judge suspended the operation of the LPA and directed the appointment of an interim deputy. This order was formalised shortly after.

DN contested the substantive application. He maintained that P had capacity at all relevant times and denied any wrongdoing.

At the final hearing on 17 and 18 June 2019, the OPG’s application was dismissed, DN’s attorneyship was restored and the appointment of the interim Deputy was discharged.

DN sought an order for costs of £82,000 and argued that the hostile approach taken by the OPG was wrong. A detailed skeleton argument in support of the point that the OPG had behaved unreasonably in the matter was submitted for the court to justify departing from the normal costs rule.

The OPG rebutted this with arguments that its approach was not hostile but simply fulfilling its duties under s58 MCA 2005 and the Lasting Powers of Attorney, Enduring Powers of Attorney and Public Guardian Regulations 2017.

The Counsel for the OPG stated “In the alternative, if the court concluded that a costs order would leave P with insufficient funds, the court should make no order for costs. This would mean that the Public Guardian would bear his own costs and DN’s costs would be met from the monies he received from P.” Whatever position the court adopted, Ms Rich said that “this was certainly not a case where the Public Guardian should be made to pay the other party’s costs.”

Rule 19.2 of the Court of Protection Rules 2017 states that where proceedings concern P’s property and affairs, that the costs of the proceedings shall be paid by P or charged to P’s estate.

Rule 19.5 provides that: (1) the Court may depart from rules 19.2-19.4 if the circumstances so justify, and in deciding whether departure is justified the court would have regard to all the circumstances including; (a) the conduct of the parties.

The Public Guardian adopted what seemed to be a standard approach to litigation based on his approach to other cases. This was a serious failure especially when rule 1.4 COPR 2017 expects litigants to comply with the overriding objective. This obligation applies equally to the Public Guardian.

The judge concluded that there was good reason to depart from the usual costs rules as a result of the OPG failing to review the capacity evidence appropriately prior to commencing proceedings. Had this been done, the “obvious deficiencies” would have been noted.

Having consideration to the relevant law and the parties’ submissions, the order made was that the Public Guardian was not entitled to be paid his own costs from P’s funds and that he should pay 50% of DN’s costs (which shall include the costs of the appeal hearing) all of which shall be assessed at the Senior Courts Costs Office by a Costs Judge.

If you have any queries please contact Bridie Sanderson at bridie.sanderson@clarionsolicitors.com or 0113 336 3350.

What are classed as ‘assets’ in COP cases?

Practice Direction 19B stipulates that fixed costs must be used in the event the Protected Party (P) does not have over £16,000 of assets on the anniversary date. The pertinent issue faced by many Deputies is what is included in the classification of ‘assets’.

When considering whether the P’s matter is what is widely known as a ‘hardship case’, you must consider whether P initially has cash or other liquid assets which total £16,000. If not, does P own a property? If P owns a property in which he/she or a dependent resides, this will not be counted towards the total asset value for this purpose. However, if it is a vacant or rental property, the value of the property can be included in calculating the total assets.

In the event that there is ligation ongoing in which the liability has been admitted and the funds are anticipated, or there is an ongoing property sale, income or inheritance in which funds will be received from, these may be classed as pending assets and you may not be limited to the fixed cost. We recommend checking the particular scenario with the Office of the Public Guardian beforehand.

Section 9 states “where the net assets of P are below £16,000, the professional deputy for property and affairs may take an annual management fee not exceeding 4.5% of P’s net assets on the anniversary of the court order appointing the professional as deputy.” You are not entitled to take interim payments whereby the assets fall below £16,000.

You must charge in line with the client asset amount on the anniversary date of the court order. If the assets are above £16,000 on the anniversary date then the 4.5% rule does not apply.

If the assets are above £16,000, deputies should know that Section 6 of PD19B states that “where professional deputies elect for detailed assessment of annual management charges, they may take  payments on account for the first three quarters of the year, which are proportionate and reasonable taking into account the size of the estate and the functions they have performed. Interim quarterly bills must not exceed 25% of the estimated annual management charges – that is up to 75% for the whole year. Interim bills on account must not be submitted to the Senior Courts Costs Office. At the end of the annual management year, the deputy must submit their annual bill to the Senior Courts Costs Office for detailed assessment and adjust the final total due to reflect payments on account already received.”

To bring this into context for when your bill of costs is being prepared, the SCCO are interested in the value of the assets of the P to enable accurate consideration for the proportionality of the bill. If your client owns any properties, vehicles, rental properties or businesses providing an income then it is appropriate for this to be highlighted within the narrative of your bill of costs. In addition, the details of the net assets value including the value of any shares and general investments held should be provided. It has been evidenced in the assessed bills returned from the SCCO that this information assists in the Cost Officer providing a just and reasonable assessment.

If you are unsure of the position in relation to P’s net assets and what should or should not be included, we recommend contacting the OPG for guidance.

However, you should have any further queries, or simply wish to discuss any costs queries you may have, please don’t hesitate to contact bridie.sanderson@clarionsolicitors.com.

Tips for Recoverability

All COP Lawyers know that the SCCO Guideline Hourly Rates can be frustrating when trying to recover all of your costs as opposed to other areas of law in which higher rates can be charged. As a result, some believe it to be unreasonable that a Costs Officer ca reduce the costs down even further on assessment. Here are some things that we have seen helps improve the recoverability of your fees.

Using 3 minutes to arrange and make payments. I know you’re told this on every assessment you’ve had back from the SCCO but ignoring it isn’t going to make your recoverability any better. The Costs Officer isn’t going to change their mind. Arranging payments are viewed as an office overhead so its best practice for you to delegate this work to a Grade D fee earner and limit the time spent and charged for to 3 minutes. The Costs Officer is going to see the effort being made and as a result, this will help with your reputation with the Court and will improve your Bill assessment outcomes.

You, like all other COP Lawyers dislike the low guideline rates that you’re restricted to. If there are any matters of complicated work, outline this to us or your other Costs Draftsperson and request enhanced rates on that particular issue. We have found that there is a higher chance of success for an enhanced rate when it is applied specifically to a complex and difficult issue than when it is applied to the whole bill. Doing this allows the Costs Officer to see specifically what was difficult and justifies why you are requesting the additional fees. We are often proactive in applying these for you when a complex matter arises, such as jurisdictional differences, the requirement of language interpretations, abusive Clients etc.

The Costs Officer will reduce or remove a second fee earner attendance at a meeting in accordance with the decisions made within the Matter of Garylee Grimsley (December 1998). Therefore, it is incredibly important for your recovery that the dual attendance is explained and justified in your attendance note. Just a line to outline why the second person was required will do, were they the main fee earner alongside the Deputy? Did the Client or Client’s family request they be present? Was the Client abusive or dangerous? It may be allowed at a reduced rate however it is

As simple as this one may sound, keep your file in chronological order and easy to get through. The last thing you want to do is make the Costs Officers life difficult when they’re assessing your costs.

Furthermore, ensure that you accurately time record your work. We appreciate that different firms have differing levels of technology available, but this need not be the most complex and time consuming system. If you do have the option to tag your time entries, this will help all parties involved when it comes to the costing of the work. Bulk time recording will cause difficulties so avoid this as much as possible. Also, ensure that the time spent is reasonable from the outset and delegate where appropriate. However, please don’t self-edit your time because if this is later reduced on assessment you will have doubly been reduced where not necessary.

Additionally, including details of the Client’s financial position assists the Costs Officer in ensuring the work undertaken is in proportion to the level of assets held and increases the chances of your time being recovered, especially in circumstances where the Client’s assets are significant and various financial schedules and reviews are required. See https://clarionlegalcosts.com/2015/06/09/how-valuable-is-the-protected-partys-estate/ for further information on this point.

I hope this helps and if you have any further suggestions or questions I would be happy to hear and discuss them further at bridie.sanderson@clarionsolicitors.com

The Senior Court Costs Office Guide – how to get paid for your work!

A recent publication of the Senior Courts Cost Office Guide was produced as a result of various changes in the way legal costs are being assessed. However, in respect of Court of Protection costs, not a great deal has changed since its inception. As a result, the 2018 guide brings the perfect opportunity to review the position on Court of Protection costs, getting paid for your work and the rules to follow.

Initially, Section 25 of the Mental Health Act 2005 created the weight of the Court of Protection, which protects the property and financial affairs of persons who lack the capacity to manage their own.

There are three methods for recovering your costs; Agreed costs, Fixed costs and Summary Detailed Assessment of costs.

Most Orders will contain a clause entitling the professional Deputy to be paid for the work undertaken. It will provide the option of taking fixed costs or having the costs assessed, subject to the terms of the Order.

Agreed Costs

As set out in the Guide, Agreed Costs are not generally available and would only be necessary in the circumstances that fixed costs do not cover the work undertaken and it would not be appropriate to undertake a costs assessment. For example, following the death of a Protected Party, they are often required to attempt to agree their costs to bring the matter to a smooth conclusion.

Fixed Costs

Practice Direction 19B supplementing Part 19 of the COP Rules 2017 sets out fixed costs that may be claimed by Solicitors and office holders in public authorities acting as Deputy for the Protected Party. However, the Court has the discretion to apply the rules to other professionals such as accountants and case managers acting as Deputy. The general rule is that the costs of the proceedings should be paid by the pp1 or their estate unless a Court Order provides for an alternative. Where a Court Order or direction provides for a detailed assessment, the Deputy can choose to take fixed costs in lieu.

Detailed Assessment

Professional Deputies should lodge a request for Detailed Assessment with the SCCO by way of N258b form. Accompanied by:

  1. the Bill of Costs
  2. the document giving right to Detailed Assessment
  3. copies of the Court Orders
  4. any fee notes of Counsel and/or expert as claimed within in the bill
  5. Written evidence of any other disbursement exceeding £500
  6. The relevant lodgement fee (currently £225.00 for detailed bills over £3,000, £115.00 for short form bills under £3,000)
  7. A copy of the OPG105 relating to the time period claimed within the Bill of Costs

In cases with costs exceeding £100,000.00, they are to be dealt with by a Master, and the relevant papers in support of the bill must only be lodged when requested.

It should be noted that, unlike litigation costs, a Court of Protection bill MUST NOT be filed electronically.

Once the assessment has taken place, you have 14 days from the date of receipt of the assessed bill to raise an appeal if dissatisfied. If following the review, you remain dissatisfied at the outcome, the SCCO will arrange a date for a oral hearing before a Master. In practice this is usually by telephone or letter.

After completion of the assessment, the Professional Deputy must complete the bill summary on the bill certifying the castings as correct, returning the original bill to the SCCO to enable them to issue the Final Costs Certificate, which is your authority to be paid.

Payments on account

Section 6 of the COP Practice Direction 19B states that Professional Deputies who elect for detailed assessment of the annual management charges can take payments on account for the first, second and third quarters of the year which are both proportionate and reasonable to the size of the estate. The interim bills must not exceed 25% of the estimated charges, so no more than 75% for the annum. The details of the interim bills received must be outlined within the Bill of Costs submitted to the SCCO.

If you require any further information, please contact bridie.sanderson@clarionsolicitors.com or call me on 0113 336 3350

Court of Protection denies Official Solicitor the recovery of costs

“In 2017, the NHS Dorset Clinical Commissioning Group launched what were intended to be four test cases seeking clarification of the law concerning the deprivation of liberty of mentally incapacitated adults. For various reasons, however, all of those applications, or in some cases that part of the application relating to the deprivation of liberty issue, were withdrawn, but not before the Official Solicitor had agreed to act for two of the respondents with the benefit of publicly-funded certificates and had incurred some legal costs. Subsequently, the Official Solicitor has applied for all or part of those costs to be paid by the applicant.” [2018] EWCOP 7 (http://www.bailii.org/ew/cases/EWCOP/2018/7.html)

This is the opening of the judgement delivered by Mr Justice Baker before rejecting the application by the Official Solicitor to recover the costs incurred in dealing with the test cases that were eventually dropped in relation to the Deprivation of Liberty of mentally incapacitated adults.

The four test cases mentioned were to seek clarification on whether mentally incapacitated adults whom lived at home with care plans devised and administered by the applicant, were being deprived of their liberty. In each application the applicant sought a declaration from the Court of Protection that the respondent was not being deprived of their liberty.

In respect of two of the four cases the Official Solicitor declined to accept the invitation, that by reason of their means, they did not qualify for public funding. It was considered not appropriate to utilise their own funds to support a test case and therefore it was agreed these two cases would be stayed. In respect of the remaining two respondents who qualified for public funding, the application continued. Inter-party discussions led to the Official Solicitor withdrawing the applications for declarations and instead sought consequential directions in all four cases.

The grounds for withdrawal were; reconsideration in light of the Official Solicitor’s analysis, difficulties and delays meant only one of the four cases was capable of proceeding on the preliminary issues and the recent publication by the Law Commission reduced the justification of the declaration sought.

The two publicly funded cases, by this point had amounted costs of approximately £30,000.00. The Official Solicitor applied for all or part of the costs accrued to be the responsibility of the applicant by arguing that the case should not have been viewed as a typical welfare case but more as a civil claim. For various reasons, this was rejected.

When considering the Applicants conduct in the matter, it was successfully pointed out that three of the four test cases were unsuitable to be included from the outset which should have been identified. The remaining test case was not pursued due to the ineligibility of public funding, it was viewed by the Court that the applicant should have funded the matter. The Law Commission’s report in which the Official Solicitor relied upon when responding to the application was published prior to the case management hearing so the outcome of the Official Solicitors response should have been reasonably considered. Thus, rendering the costs incurred by the Official Solicitor in responding for the most part as unnecessary.

In response, the Applicant submitted that the application was in good public interest due to the uncertainty of the area of law in respect of the Cheshire West’s “Acid Test”, that withdrawing the application was justified due to the lack of a “sufficiently broad range of facts to give the applicant sufficient guidance to the 100+ incapacitated adults for whom it is responsible for providing healthcare services at home” and the budget constraints which made funding the application without public assistance unattainable.

It was concluded that a costs order against the applicant in this matter was inappropriate save as to those of the Official Solicitor’s costs that were publicly funded.

Bridie Sanderson is a Paralegal in the Costs and Litigation Funding Department.

You can contact Bridie on 0113 336 3350, or alternatively email at bridie.Sanderson@clarionsolicitors.com