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A Mutual Dependence

David Ross v A (by her litigation friend, the Official Solicitor) [2015] EWCOP 46 - a decision of Senior Judge Lush handed down on 7 July 2015. This is a nice case that arguably raises some new issues concerning gifts from P’s (protected person) assets by a deputy, in particular where those assets derive from a personal injury or clinical negligence award.

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The case concerns A (for ease we’ll adopt the name Amy), an 18 year old female who suffered an anoxic brain injury at the age of 10 weeks following a failure by her GP to diagnose. As a result of the injury, Amy suffered cerebral palsy, epilepsy and cortical blindness, as well as severe mental impairment and behavioural problems. Amy’s clinical negligence came to trial in 2010 and the case settled for £5,000,000, a compromise due to a marked disagreement on life expectancy. Of note, this was a lump sum payment only. The GP was indemnified by the Medical Defence Union, who was, in the words of Senior Judge Lush, ‘either unwilling or unable’ to provide periodical payments.

In 2012, Amy’s property and affairs deputy, Mr David Ross, a solicitor experienced in Court of Protection proceedings and the role of deputies, made an application to the Court of Protection for authorisation to use some of Amy’s assets to pay for her younger brother’s school fees. The basis for the application was that her younger brother (‘Billy’), who was 14, had suffered detrimentally in his formative education years due to the family attention that was, understandably, focused on Amy’s complex needs. He had failed to gain a place at the local grammar school. The only state funded alternative was several miles away. The family were therefore faced with the necessity of finding a local school at short notice that would meet Billy’s needs whilst allowing the family to continue to care for Amy, untroubled by travel arrangements for Billy. The solution appeared to be a local independent school.

Unfortunately, once Mr Ross’s application papers reached the court, the trail went cold, so to speak, and the matter did not receive judicial attention until July 2014, with a hearing eventually listed before Senior Judge Lush in April 2015. In the meantime, Amy’s deputy had been paying the school fees from Amy’s assets in the hope that the court would ratify the gifts retrospectively.

Counsel for Amy’s deputy made inter alia the following points:

  1. The cost of the school fees represented only 3% of Amy’s estate and could be funded out of income;

  2. Paying Billy’s school fees would allow Amy to recognise the obligation that she had to a loving brother whose education had been limited as a result of her needs and the litigation;

  3. The hampering of Billy’s education might negatively affect his and Amy’s relationship in the future;

  4. Ensuring that Billy is happy alleviates a stressful family situation and allows the parents to focus on Amy;

  5. The case was different from Re JDS [2012] COPLR 383 because Amy would feel a direct and immediate benefit in her lifetime (as opposed to by her beneficiaries after her death) and the payment was far more affordable than in that case.

The Official Solicitor, who had been appointed as Amy’s litigation friend, did not agree. He took the view that the arrangements appeared to be in Billy’s best interests, not Amy’s. There was no moral obligation on Amy towards Billy. Also, the compromised damages award had to last a lifetime of substantial care; any excess income should be invested carefully for the future. The Official Solicitor then went a step further and suggested that the payments to date had been at the deputy’s own risk and that Mr Ross should repay Amy’s estate. He said ‘the deputy’s principle function is to protect and conserve the fund’.

Senior Judge Lush did not agree and observed that, in dealing with vulnerable persons, many professionals, the court included, can be drawn towards a conclusion that is over protective or simply risk averse. The judge described the Official Solicitor’s approach as ‘intrusive and hostile’, involving a microscopic scrutiny of expenditure and condemnation of the extent to which the family is dependent on Amy’s award. It was also ‘cautious, paternalistic and risk averse’. The Official Solicitor’s solution that the deputy repays Amy was described as ‘crudely opportunistic’.

In dealing with the law, and the Official Solicitor’s approach, Senior Judge Lush made some interesting observations.

Mutual dependence

Senior Judge Lush observed that due to the sacrifice of careers by parents in order to care for a disabled child, most families are as dependent upon a damages award as the recipient of the award is dependent on their family. In Re B (deceased) [2000] 1 All ER 665 it was acknowledged that this mutual dependence was ‘natural and inevitable’. Allowing the mother’s appeal on an Inheritance (Provision for Family and Dependents) Act claim against her deceased child’s estate that derived from a damages award, Walker LJ stated:

‘In this case it must have been obvious to the officials at the Court of Protection who were taking decisions about Louise’s funds that her funds (and her 75% share in the house) were to be used in a way that met Mrs Bouette’s financial and material needs, so as to enable Mrs Bouette to look after her daughter’s physical and emotional needs’.

It would therefore be impossible to consider Amy’s interests in isolation from those of her family as a whole. In considering her best interests, the decision-maker must take a holistic approach and consider her welfare in the widest sense, not just financial, but social and emotional.

Discretion conferred upon a professional deputy

Because of the existence of mutual dependence in cases of this kind, Senior Judge Lush confirmed that it is generally preferable for a professional deputy to be appointed. He noted that in most orders appointing the deputy, the court confers a broad discretion which gives the deputy considerable flexibility and freedom in making decisions. In principle, professional deputies are well-placed to know what is in a particular client’s best interests and to make decisions accordingly. Section 4(7) of the MCA 2005 requires the court to take into account a deputy’s views. Where, as in this case, an experienced professional deputy had gone through the checklist of factors in section 4 of the MCA and has considered all the relevant circumstances and had concluded a particular course of action is in P’s best interests, the court should be reluctant to interfere with his decision unless it is plainly wrong.

Deputy’s authority to provide for others

In addition to all that has been said thus far, Senior Judge Lush went on to make the observation that there is power for deputies to make provision for those connected with P, despite no express provision in the MCA 2005, citing Baker J in Re X, Y and Z [2014] COPLR 364:

‘I accept that the court has power under the 2005 Act to approve payments for the maintenance or other benefit of members of P’s family, notwithstanding the absence of an express provision to that effect in the Act, provided such payments are in P’s best interests. Such payments might be called ‘altruistic’, but are more characterised as falling within the broad meaning of the concept of ‘best interests’ under the Act’.

Indeed, Senior Judge Lush pointed out that in this case clause 2(d) of the order appointing Mr Ross as Amy’s deputy provided that:

‘The deputy may make provision for the needs of anyone who is related to or connected with Amy if she provided for, or might be expected to provide for, that person’s needs by doing whatever she did, or might reasonably be expected to do, to meet those needs.’

Senior Judge Lush went on to say that the court has, of course, wider powers than a deputy or attorney to provide for the needs of others and section 8(2)(e) of the EPA Act provided that:

‘The court may – (e) authorise the attorney to act so as to benefit himself or other persons than the donor otherwise than in accordance with sections 3(4) and (5) (but subject to any conditions or restrictions contained in the instrument.’

In the case of a deputyship, these powers are now exercisable under section 18(1)(b) of the MCA.

Judicial precedent in the Court of Protection

At the conclusion of his judgment, Senior Judge Lush was keen to play down the role that judicial precedent plays in Court of Protection proceedings and that his decision should not be seen as an imprimatur for the payment of sibling’s school fees from damages awards in other cases. Citing Hedley J in Re GC [2008] COPLR Con Vol 422:

‘Each human being is unique and, thus, best interests decisions are unique to that human being’.

I think we can take the point but should remember that this had not prevented Senior Judge Lush from considering previous gift cases in his judgment, including his own Re JDS [2012] COPLR 383 and Re AK (Gift Application) [2014] COPLR 180 as well as introducing the concept of ‘mutual dependence’ from precedents set in damages cases.

More interestingly, Senior Judge Lush’s closing remarks in many ways echo those of Lord Wilson in the recent high profile human rights case of Cameron Mathieson (Cameron Mathieson v Secretary of State for Works and Pensions [2015] UKSC 47), which was handed down just one day later in the Supreme Court. In that case, which concerned a disabled child’s entitlement to Disability Living Allowance (DLA), it was held that the suspension of his DLA after 84 days in hospital, which was allowed by the relevant regulations, violated his human rights, Lord Wilson said, at paragraph 49 of the judgment:

‘It may not always follow that the suspension of payment of a child’s DLA following his 84th day in hospital will violate his human rights. Decisions founded on human rights are essentially individual; and my judgment is an attempted analysis of Cameron’s rights, undertaken in the light, among other things, of the extent of the care given to him by Mr and Mrs Mathieson at Alder Hey. Although the court’s decision will no doubt enable many other disabled children to establish an equal entitlement, the Secretary of State must at any rate be afforded the opportunity to consider whether there are adjustments, otherwise than in the form of abrogation of the provisions for suspension, by which he can avoid violation of the rights of disabled children following their 84th day in hospital’.

Thus, in a similar fashion to Lord Wilson, in David Ross v A, Senior Judge Lush found that, like human rights, best interests are unique. Similarly, like Lord Wilson, he too had been very mindful of the care and devotion afforded to the disabled child by the family in this case. That might be, in any other case, what he would have called a ‘factor of magnetic importance’, although he did not use the phrase here. Lord Wilson accepted that despite the facts of the Matthieson case being unique, the decision would assist many. Although we can understand Senior Judge Lush’s reticence about opening the floodgates to ‘school fees applications’, this case, too, will assist many and it is therefore probably fair to say that judicial precedent in the Court Protection is not dead.

It is also, to my mind, demonstrative of Senior Judge Lush’s innovative thinking and ability to achieve the ‘right’ result for P and of the fact that the views of the Official Solicitor (or Public Guardian) will always be subjected to very close judicial scrutiny in those cases (in particular see: Re DT [2015] EWCOP 10; Re MC [2015] EWCOP 32; Re HC [2015] EWCOP 29; Re HS [2015] EWCOP 33; a spate of cases from earlier this year in which Senior Judge Lush dismissed applications by the Public Guardian or substantially disagreed with them).