Forum

Issues Arising in Acting as Appointee for Clients

For many clients receiving their welfare benefits through the use of an Appointee can be helpful and can assist in the overall management of their affairs. However, it is important to consider some of the professional issues which can arise when acting in this capacity.

For most clients who have capacity to manage their own affairs the obvious route will be to appoint an agent to handle the collection of their State Benefits or in the alternative to arrange, where possible, for these benefits to be paid directly into their bank/building society account. However, where the client is mentally incapable of managing their own affairs then the way forward is by use of the Secretary of State appointment of an Appointee. (See BA leaflet AP1 A Helping Hand: How can you help somebody with a disability claim the Social Security benefits due to them?).

Appointeeship is regulated by Reg 33 of the Social Security (Claims and Payments) Regulations 1987. This sets out in full the requirements for such an appointment to be made. However the regulation does not specifically cover the appointment of an Attorney as Appointee and it is important to note that BA will generally treat the Attorney in the same way that they would treat an Appointee. They will therefore want to be certain that the Attorney understands the full spectrum of responsibilities involved in acting as an Appointee. Indeed it is possible for the Secretary of State to revoke that appointment if, in his opinion, the Attorney would be unsuitable.

An Appointee's authority is only to deal with the clients Social Security payments and not with the client's other monies unless he is authorised to do so by other means. So, capital represented by accumulated Social Security benefits would come into this ambit but other capital would not. That must be handled under another authority. e.g. Receivership or an Enduring Power of Attorney.

To become an Appointee the following procedures are involved:

(i) Completion of form BF56 and return to BA

(ii) BA completes enquiries to ensure that the claimant cannot act for him or herself (This may involve BA in undertaking a home visit but it may not necessarily mean that a medical examination will be required)

(iii) Checks will be undertaken to ensure that no-one else is already acting as Appointee (this is not unknown!)

(iv) The prospective Appointee will be interviewed by BA to check suitability and to explain in full the responsibilities of an Appointee. At this stage referees may/may not be required

(v) Appointment confirmed if all is in order

(vi) Checks will be made at intervals to confirm the continuing suitability of the Appointee

Note that there is no appeal against the Secretary of State's decision.

At this point, bearing in mind the duty to disclose the client's assets if on means tested benefits, it is good practice to carry out an audit of the benefits being received and to consider whether there are any which could be claimed for the client. This may be significant if Disability Benefits are not being claimed and the client is about to or has recently gone into residential or nursing care and is self funding.

Appointees need to be aware that they are under a duty to apply the benefits in the claimant's best interest and failure to do so could lead to revocation of the appointment. As an aside it should be considered that if an appointee is not applying benefits properly that a 'whistleblowing' action should be considered. BA take these issues very seriously.

An appointeeship carries personal liabilities which include full disclosure of assets where appropriate, repayment of benefits where there has been an overpayment and avoidance of misrepresentation. Clearly the failure to advise of death and to continue to claim benefits is a blatant example of misrepresentation and is fairly common. This is fraud.

Professionally it is good practice to follow similar guidelines to those recommended for the appointment of Executors. There should be clearcut office rules about who in the practice can act as Appointee and also there should be in house audits of their management of the clients money. It may be wise to check with insurers whether there is cover for such appointments.

Anne Edis - Solicitor and Legal Adviser, Tel: 01162 880057