Court of Protection Deliberates on Disclosure of Financial Settlements to Vulnerable Individuals

Citation: [2024] EWCOP 14
Judgment on

Introduction

In the matter of PSG Trust Corporation Limited v CK & Anor [2024] EWCOP 14, Mr Justice Hayden scrutinizes several critical issues concerning the functions and responsibilities of a Property and Affairs Deputy within the Court of Protection. The legal analysis delves into whether a deputy must inform a person – deemed as ‘P’ in court documents – of the value of their civil litigation settlement and the complex intersection between ‘capacity to know’ and ‘best interests’ pursuant to the Mental Capacity Act 2005.

Key Facts

The Court of Protection was confronted with two linked cases questioning whether CK and NJ, who were represented by PSG Trust Corporation Limited as their Property and Affairs Deputy, should be made aware of the value of their respective financial settlements from civil litigation. Differences in individual capacities and vulnerabilities underpinned the necessity to approach each case discerningly, supported by expert witness assessments and previous case law. The hearing hinged on whether the individuals had the capacity to understand their financial situations and, if not, whether it was in their best interests to be informed of the same. The hearing also accommodated opinions from members of the Professional Deputies Forum to ascertain the consensus and practice among professional deputies.

Central to the analysis was the application of Section 1-3 of the Mental Capacity Act 2005, which outlines principles for assessing an individual’s capacity for decision-making. Key takeaways include the presumption of capacity, decision-specific capacity assessments, and the recognition of a person’s inability to make a decision based on their understanding, retention, use, and communication of information.

Mr Justice Hayden critically evaluated three notable precedents:

  1. EXB v FDZ [2018] EWHC 3456 (QB): This case involved a court’s decision that it was not in the claimant’s best interests to know the amount of a settlement, and that the claimant lacked the capacity to make that decision.
  2. PBM v TGT [2019] EWCOP 6: Where disclosure of financial information was required for PBM to make a decision - a prenuptial agreement - despite concerns over financial vulnerability.
  3. DXW v PXL [2019] EWHC 2579: Saini J corroborated the decision in EXB and the logic applied within the same context that P should not be informed of their personal injury settlement amount.

In assessing whether P should know the value of their estate, Mr Justice Hayden challenges the notion that such knowledge is inherent to a capacitous person, instead arguing that capacitous individuals can and do make decisions about receiving potentially distressing or sensitive information.

He further explores the relationship between a deputy and P, akin to that of an agent or trustee to a principal or a beneficiary – a relationship that typically endows an automatic right to financial information but must be nuanced in cases involving vulnerable individuals under the Court’s protection.

The judgment separates the capacity to know from best interests decisions and maintains that vulnerability to exploitation should be considered within the capacity assessment, not solely under best interests.

Outcomes

For CK, despite her superficial presentation, the inherent vulnerabilities and lack of insight into potential financial exploitation determined her incapacity to make informed decisions regarding the size of her settlement. However, given her consistent request for this information, her capacity to make rudimentary financial decisions, the protective presence of a strong family network, and testamentary capacity, it was decided in her best interests to be provided with the settlement amount.

Conversely, NJ was assessed to possess profound cognitive difficulties, limiting her understanding of monetary value and incapacitating her from recognizing personal financial vulnerability. The Deputy’s assessment and her past experiences with financial abuse propelled the court to conclude that it was not in her best interests to be made aware of the settlement amount.

Conclusion

The issue tackled by Mr Justice Hayden in PSG Trust Corporation Limited v CK & Anor [2024] EWCOP 14 meticulously examines the complexities intersecting capacity and vulnerability in the realm of financial decision-making. It reiterates the need for bespoke analyses of capacity that respect individual autonomy while considering the innate need to protect P from external exploitation. The judgment clarifies the boundaries between capacity assessment and best interests decisions, paving the way for lawyers and deputies in handling such sensitive matters within the parameters of the Mental Capacity Act 2005.