Book review:

Protecting the Assets of Older People

Author: David Coldrick

Protecting the Assets of Older People as a title no longer reflects the depth of the content of this book. Readers, who know David or have heard him speak, will find his voice and style leap up from every page. It contains a wealth of information and covers the subject area to a level that practitioners need if they are to advise in this complex area. Since the first edition, there have been a considerable number of changes in the field of community care law, which is reflected in this volume. This has now got to be the most up-to-date text on the market.

The book is in loose leaf but should justifiably be in two separate volumes. As this area evolves, it is clear that more issues are relevant for advisers, ranging from practitioners duties to human rights and welfare benefits. Practitioners, who are not so familiar with this area, will need to read the book from cover to cover and then use the book as a source of reference. The index allows ease of access to the required text.

Section 1 covers the problems with outright gifts, the partial solution of will planning and the solution of the Flexible Life Interest Trust, including the tax and administrative ramifications. I would have liked this section to have included more detail on practitioners’ duties and undue influence to reflect the increase in case law and guidance in addition, the deficiencies of lease-backs and other schemes that some practitioners use. That said, this book is unique in that it is a solution-based product, with example letters to local authorities in arguing against the application of the notional capital rule.

Section 2 details the history of the NHS’s responsibility to make provision for long-term health care needs, in particular, the outcome of R v North and East Devon Health Authority, ex parte Coughlan. There is a very useful section on the structure of the NHS, which has been confusing with the changes brought about through NHS restructuring. It leaves the reader with a clearer picture of the various bodies and their responsibilities and accountabilities.

Section 3 continues with the current guidance from the Department of Health on entitlement to continuing NHS health care with how it fits in with the Coughlan judgement. Important in the practitioners’ armoury for challenging adverse decisions are the Continuing Care Review panels. David has produced a useful letter to the Health Authority when initially challenging a decision. The letter could also act as a reminder of all the different pieces of information one needs to obtain before going down this route.

The implementation of free nursing care from October last year is dealt with thoroughly in section 4. This is still a complex issue, as practitioners need to be sure that their clients fall within the correct band and, in particular, to clarify if those who receive the higher rate fall within the criteria for full NHS funded care, as there is an overlap between two separate pieces of Department of Health Guidance.

Clients sometimes think they know the local authority rules on assessment and enforcement for care fees and David covers the myths in section 5. The contents could be used as a way of targeting clients for the marketing of asset protection services, perhaps by in house seminars to clients.

Whether the notional capital rule will ever apply depend on whether the client is assessed as needing residential accommodation that the local authority is under a duty to arrange and whether the local authority is authorised to charge. As a consequence, the adviser needs to know the extent of the statutory duty and the role of the needs assessment in the provision of accommodation. The local authority’s ability to charge for accommodation flows from the duty to provide. If the provision is made under the National Assistance Act 1948 then the local authority must charge according to the National Assistance (Assessment of Resources) Regulations. However, if the accommodation is provided as part of the local authorities role in providing aftercare under section 117 of the Mental Heath Act 1983, then local authorities cannot charge and so notional capital will never come into play. Where a financial assessment is required, practitioners need to know rules that may prevent future problems, such as not providing information of the non-resident spouses resources. Everything you need to know on this is contained in section 6.

Section 7 contains the major capital disregards and the basis for valuing different types of assets. One cannot avoid having in depth knowledge of these as they are of assistance to those in care or going into care and for whom it may be too late to make any significant plans for asset protection. By having this vital information you can ensure that your clients access local authority assistance at the right time so preventing them from using up assets that they did not need to realise. Practitioners can then plan when to request a needs assessment for without this there cannot be any financial contribution from the local authority. Failure to ask at the appropriate time may leave the practitioner subject to negligence claims. The deferred payment scheme is bolted on to the end of this section and would possibly be better placed in the section on recovery of fees. It is, however, comprehensive and given the wording of the guidance, it is an achievement.

Understanding the detail of the notional capital rule (Section 8) is the foundation from which the practitioner is to argue that it does not apply to the Flexible Life Interest Trust. In addition some gifts or transfers will never be subject to the notional capital rule as they cannot be assessable. These are useful tools, in particular for the person who is in a care home or about to enter a care home. For example, by passing the personal possessions of the resident on to the next generation as a gift, it avoids that asset having to be sold and the proceeds becoming means tested.

Since the growth in home ownership and the increase in council home purchases under the ‘right to buy’ scheme, trust issues have become more common. When the legal owner moves into care a number of trust issues may arise, for example, a resulting trust due to the financial contribution by another or a constructive trust due to acts that change the basis on which the property is held. The issue may not always be apparent from the initial enquiry about wanting to give away the home, but should always be explored by the adviser. David covers this topic in section 9 thoroughly.

Proprietary estoppel is another doctrine that may prove to be of assistance, where the older client has moved into a care home. although most cases are brought after the legal owner’s death, David explores, in Chapter 10, how it can be argued when the home is put on the market for sale.

The following two sections are dedicated to the various methods of enforcement. The cases of Yule v South Lanarkshire Council and Beeson v Dorset County Council are analysed. David has picked up on the key issue for lawyers; how can we get local authority lawyers to understand the impact of Beeson? David provides a number of sample letters to aid the task. These can easily be adapted for the client’s particular case.

David pulls together why he believes the Flexible Life Interest Trust may never be subject to the notional capital rule in a compelling way. As with much in this area there are no guarantees, as the client has to be happy from the outset that the matter may require considerable time in corresponding with the local authority or even litigation. As David so rightly says: “It is up to the practitioner to add these arguments to his existing armoury and not give way under pressure”.

Many local authorities play the ‘sham trust’ card, when faced with any form of self -settlement and David puts these arguments in context. As such it gives the practitioner confidence in handling the situation. Being confident of your position is important whenever in communication with the local authority, for without it it is easy for the case to fold.

The final part of the book contains six appendices, comprising of a number of relevant articles including the use of discretionary trusts in asset protection and the legality of waiting lists often used to manage local authority budgets.

The book is an impressive piece of work. A sound reference book with useful tactics to employ with the local authority. I have heard this book referred to by some as ‘the bible in community care’; perhaps a more accurate title than the one it has at present.

Caroline Bielanska is a solicitor, TEP, lecturer and freelance consultant. She can be contacted at caroline.bielanska@ntlworld.com.