SM v HM 11875043/01

Analysis

HM was born on 3 April 2004 and suffered from cerebral palsy following injuries she sustained during her birth. She was likely to lack capacity on reaching 18 and it was agreed that the Court of Protection had jurisdiction over her property and affairs. Proceedings against the relevant NHS trust for damages were compromised in 2010. The level of compromise damages was much less than the real level of HM’s likely care needs owing to leading counsel’s advice that her claim stood only a 25% to 33% prospect of success.

On 10 September 2010, District Judge Ashton had refused to authorise the creation of a personal injury trust of HM’s assets. District Judge Ashton was not satisfied that it would be in HM’s best interests for her damages to be administered other than through the Court of Protection, which in practice would mean a deputyship order. SM (HM’s mother) sought reconsideration of the decision and District Judge Ashton ordered that the reconsideration should be referred to HHJ Hazel Marshall QC.

The issue before HHJ Marshall QC was whether it was ever, and if so in what circumstances, appropriate for the Court of Protection to authorise the creation of a personal injury trust rather than appointing a deputy.

Held (ordering the creation of a personal injury trust)

1. 1. As a matter of law, the Court of Protection had the power to authorise the creation of a personal injury trust as an alternative to deputyship (paras [25]-[27]).
2. 2. The overriding principle is that such a decision must be justified on the grounds that it is in the patient’s best interests. Any actual decision is completely fact sensitive to the individual case. Deputyship should be the norm and authorisation of a settlement must be justified as a departure from this norm (paras [29]-[31]). Deputyship is the benchmark against which to compare any other proposed method of administering the patient’s assets (para [35]).
3. 3. In order to show that a settlement is in a patient’s best interests, the applicant must demonstrate that the proposed settlement and its terms provide an overall state of advantage over a deputyship order that it justifies a departure from the norm. Where safeguards equivalent to deputyship are not reproduced by the trust instrument, the court must be satisfied that this is sufficiently outweighed by other advantages to make it in the patient’s best interests to proceed by way of trust. Any prospective costs saving must be balanced against any risks (paras [137]-[145]).
4. 4. There was evidence that savings of £1,000 to £2,000 might be obtained if HM’s assets were settled in trust as an alternative to a deputyship order. Given the discounted level at which HM’s claim had been compromised, providing for her needs was likely to be financially stretching (para [147]). SM was a competent, forceful, well-educated and responsible person and her solicitor had undertaken a voluntary cap to their fees. A personal injury settlement of HM’s damages would be authorised (paras [167]-[170]).
5. 5. This particular decision should not be relied on as a precedent with regard to facts (para [172]).

JUDGMENT HER HONOUR JUDGE HAZEL MARSHALL QC: Introduction [1] This is a reconsideration under r89 of the Court of Protection Rules 2007 of an order of District Judge Ashton made on 10 September 2010, which raises an apparently controversial point about the administration of the affairs of persons who lack capacity under the Mental Capacity …

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