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Written on 14th July 2020 by Alex Edwards

The recent case of KKL Executor & Trustee Company Ltd v Harrison [2020] EWCOP 25 (01 May 2020) demonstrates how the Court comes to a decision when two professionals make separate applications to be appointed as Deputy for P and what factors it will consider most important.

It is usually expected that when two professionals are approached separately to make an application they would be able to reach an agreement on who is best placed to act between themselves without reverting to the Court. In this case, the parties were unable to reach an agreement and with accusations of aggressive behaviour and conflicts of interest the matter was listed for hearing.

This matter concerned OT, an 81 year old woman with advanced senile dementia. OT’s capacity to manage her property and financial affairs was not in dispute. OT had been living with her sister who had been caring for her. While OT was in hospital in February 2019 her sister died. OT was discharged home without the usual support of her sister. OT’s doctor confirmed that OT had been diagnosed with dementia in 2015 and when he assessed her in March 2019 made an immediate referral to social services.

It was determined that there were no close family or friends able to act so the Local Authority approached LH (a solicitor) to make an application to be appointed Deputy for OT to manage her property and financial affairs. KKL (a trust company) also made an application to be appointed Deputy for OT.

One of the key issues with this matter involved OT’s current Will. KKL had been instructed to draft the Will which appointed JNF Charitable Trust as a residuary beneficiary. KKL is closely linked with the charity with several of their directors acting as Trustee of JNF Charitable Trust. It was alleged that KKL’s drafting of the Will was in breach of the Fundraisers Code. LH stated that if she were appointed Deputy it would be her duty to investigate this breach and consider whether a Statutory Will application should be made.

LH objected to KKL being appointed Deputy due to the potential conflict and breach of the Fundraisers Code but also due to them having little experience acting as a Deputy. LH also objected on the basis that KKL weren’t best placed geographically to be able to act.

There seems to be three key reasons KKL objected to LH being appointed as Deputy:

  1. The agreement between LH and the Local Authority was an improper arrangement;
  2. LH would charge for the managing OT’s property and financial affairs and would potentially instruct her own firm to investigate KKL’s breach creating a conflict of interest. This investigation would generate more cost to OT; and
  3. LH had never met OT and it was noted that OT had been apprehensive of new people being introduced to her. 

KKL stated they had a good relationship with OT and placed strong emphasis on the fact that OT had chosen them previously to act as executor, therefore trusting them to deal with her affairs when she passed away. KKL also stated that they would not charge OT for managing the deputyship.

In the judgement District Judge Geddes found that there was no issue with the referral arrangement between LH and the Local Authority and that no evidence had been presented showing that it was not in OT’s best interests. LH stated that she would charge for managing the deputyship but that it would be subject to a fixed fee as determined by the Court or the file would be submitted to the Senior Courts Costs Office for assessment. The Judge accepted that LH would be duty bound to investigate a potential breach if she were appointed Deputy for OT and to consider all factors when making a decision in OT’s best interests. LH stated that she had not yet met OT as she did not represent her and this was not uncommon.

Although KKL strongly demonstrated they were best placed to be appointed Deputy as they already had a good relationship with OT and would not charge for their work, the Judge dismissed their application and allowed LH’s application stating

"the magnetic features have to be the need to investigate whether KKL’s conduct of OT’s affairs to date has been in breach of the Fundraisers Code and the clear potential for a future conflict as a result of JNF UK being the sole beneficiary of OT’s estate."

This case is a clear example of the factors the Court will consider in appointing a Deputy and the weight they will place on each factor.