30 July 2021 - Article
One of the more unusual rules in the Court of Protection (as opposed to litigation in other courts) is that where an application concerns a person’s property and financial affairs the start point is that everyone should get their legal costs paid by that person’s estate.
However, the recent case of Re JBN  EWCOP 62 is a cautionary tale of when the Court of Protection may depart from the usual rule.
JBN had made a lasting power of attorney (‘LPA’) appointing his son, DN, as his attorney for his property and financial affairs.
The Public Guardian (‘PG’), whose office is responsible for supervising attorneys, was concerned about DN. In particular, he questioned whether JBN had capacity to execute a LPA; and was concerned that DN had not acted in his father’s interests by selling his father’s home for £975,000 and transferring funds to a joint account.
The PG issued proceedings to revoke the LPA. At the same time it also applied, without notice to DN, for interim orders suspending the LPA and appointing an interim deputy. The Court grant those interim orders before DN had an opportunity to object (although both orders made provision for DN to apply to vary/discharge them).
DN maintained that his father had capacity to make the LPA and he denied any wrongdoing. Following a two-day hearing the Judge held that the PG’s application should be dismissed, that DN should be restored as attorney, and that the interim deputy (who had by then incurred costs of £9,000) should be discharged.
The question of costs was then considered. DN had incurred legal costs of £82,000. He argued that the PG should pick up the tab rather than his father because, he said, the PG had behaved unreasonably in embarking on ‘hostile Court proceedings’ and that the interim applications weren’t necessary. By the PG’s own admission, DN had cooperated with its investigation.
The Judge held there was a good reason to depart from the normal costs order. The real issue was JBN’s capacity at the time of the sale of the property and so before commencing proceedings the PG should have reviewed the capacity evidence with care. Had he done so he would have concluded that the evidence of incapacity was weak. The PG could have invited DN to agree to a joint expert being instructed rather than embarking upon litigation. The Judge was particularly concerned that the PG had sought very serious without notice orders for the suspension of the LPA and an appointment of an interim deputy.
Generally, the Judge pointed to a ‘lack of consideration’ given by the PG, the result of which was acrimonious and costly litigation, achieving ‘next to nothing for JBN’. The Judge held that the fairest order was to provide for the PG to have to pay his own costs (rather than taking them from JBN’s funds) and that he should pay 50% of DN’s costs (with the balance to come from JBN’s estate).
While costs orders of this kind are unusual in property and affairs cases, especially against public bodies, this case is a salutary reminder of the Court’s willingness to exercise its discretion on costs in certain circumstances. For reasons that are not clear, but, one surmises, could be down to stretched resources, the Judge said that the PG had taken what seemed to be a standard approach to litigation based on other cases, which was ‘a serious failure’.