Social Security appointeeship - Elderly Client Adviser

Feature

posted 1 Mar 1999 in Volume 4 Issue 3

Social Security appointeeship

Alan Robinson considers the law and practice of appointeeship and comments on the potential problems that may arise.

One of the oddities of acting for those with some degree of mental incapacity is that, while the mechanisms of the Mental Health Act, the Court of Protection and Enduring Powers of Attorney afford a considerable degree of protection for the mentally incapable person and the majority of their affairs, there is very little formality involved in arranging for someone to deal with their social security claim. This article considers the law and practice of appointeeship and comments on some of the potential difficulties which the system may create. Appointeeship should be distinguished from agency, where the capacity of the claimant is not in doubt; he or she simply authorises another person to (for example) collect a pension.

For benefits other than housing and council tax benefit, the law is to be found in Regulation 33 of the Social Security (Claims and Payments) Regulations 1987 (SI No 1968). Paragraph 1 provides as follows:

"Where -
(a) a person is, or is alleged to be, entitled to benefit, whether or not a claim for benefit has been made by him or on his behalf; and

(b) that person is for the time being unable to act; and

(c) no receiver has been appointed by the Court of Protection with power to claim, or as the case may be, receive benefit on his behalfthe Secretary of State may, upon written application made to him by a person who, if a natural person, is over the age of 18, appoint that person to exercise, on behalf of the person who is unable to act, any right to which that person may be entitled and to receive and deal on his behalf with any sums payable to him."

A number of facts may be noted. An appointee may be a natural person (in which case they must be over 18) or a body of people such as a firm of solicitors or a housing association. The appointment is made by the Secretary of State, who may revoke the appointment at any time. The appointee may resign on giving one month's notice. An appointment automatically terminates when the Secretary of State is notified that a receiver (but not an attorney, whether under an enduring power or otherwise) has been appointed. (Reg 33(2)).

In fact there is no reference at all in the legislation, and very little in the guidance, to Enduring Powers of Attorney. On the face of it, a person may complete an EPA with a view to their future incapacity, appointing person A to be their attorney, but the Secretary of State may nevertheless accept an application from person B to become an appointee. Gordon Ashton, in 'Elderly People and the Law', says that, where there is a registered EPA, there is someone able to act for the claimant, and so the appointeeship procedure is not appropriate. He is surely correct in saying this, but like so much of the subject, it is not an assertion which can readily be backed by reference to anything other than the practice of the Benefits Agency. Presumably the argument is that the person is not "unable to act" for this purpose where there is an attorney to act in their place - assuming, of course, that the EPA contains the relevant authority for the attorney.

Nor is there is any indication of the meaning of the phrase "unable to act". The implication of Reg 33 (1)(b) above is that the inability to act is caused by mental incapacity, but that is not stated, and nor is any degree of incapacity indicated - the Court of Protection may not appoint a receiver (sub-paragraph (c)) unless the person is mentally disordered in accordance with the Mental Health Act, but it would apparently be possible for the Secretary of State to make an appointment at a lesser level of incapacity. The only reference to the level of incapacity which is to be found in the Adjudication Officers Guide (AOG) is in paragraph 11071, which refers to someone who "is unable to act, for example by reason of senility or mental illness." No indication is given as to how this decision is to be taken.

Normal practice within the Benefits Agency following the receipt of an application is for the Agency staff to make enquiries to satisfy themselves as to the appropriate course of action. This should include a visit to the claimant, or at the very least appropriate medical evidence. It should also include obtaining information about whether a receiver has been appointed or may be, and whether there is an EPA. There should also be a visit to the appointee to ensure that they take an interest in the claimant's welfare and are ready and willing to act.

The choice of appointee will normally take into account matters such as the relationship between the proposed appointee and the claimant. A close relative who lives with the claimant or who visits frequently is to be preferred. The claimant's views, if he or she is capable of expressing them, should be taken into account. If the claimant is in hospital or residential care, an officer of that institution may be appointed. In deciding whom to appoint, the Secretary of State will be bound to exercise his discretion with due regard to the principles of administrative law.

The AOG says that appointments "may not be appropriate if someone already has power of attorney", although it may be appropriate to appoint the attorney as an appointee. The reference in the AOG is clearly to a power as opposed to an enduring power, though the next paragraph explains what an enduring power is. However, no distinction is drawn between a power of attorney and an EPA, nor is there any reference to the registration of the EPA and the circumstances in which this might be done. An officer in the local office of the Benefits Agency who relies on the AOG alone is clearly going to be short of information in making these decisions.

There have been few Commissioners Decisions on the Regulation. In CIS/812/1992, it was held that a claim by someone who is unable to act, or by an unauthorised person on their behalf, is nevertheless valid. This decision relies on the decision of a Tribunal of Commissioners in R(SB) 9/84 that, in the absence of a challenge made at the time of the claim, the Secretary of State must be deemed to have accepted that the claim was properly made. An appointment is retrospective (R(SB) 5/90).

The only other decision of interest appears to be that in CIS/638/1991, where the Commissioner considered the relationship between Regulation 33 and Regulation 30, which covers the appointment of a person to continue a claim after the death of the claimant. He held that the fact that a person is appointed under Regulation 33 does not mean that the same person is entitled to act as the appointee after the death of the claimant, and a fresh appointment must be made under Regulation 30. The decision includes an express dissent by the Commissioner from R(SB) 9/84, and is described by the editors of "CPAG's Income Related Benefits: The Legislation" as contrary to the weight of authority. It certainly seems to run contrary to the reasoning to be found in CIS/638/1991.

The legislation on housing benefit is somewhat more explicit. Regulation 71(2) of the Housing Benefit (General) Regulations 1997 provides that where the claimant is for the time being unable to act, and a receiver has been appointed by the Court of Protection or an attorney has been appointed under a Power of Attorney or an Enduring Power of Attorney, that person may make a claim on behalf of the claimant. Where the claimant is unable to act and has nobody acting for him or her as above, then the authority may appoint someone to act under Regulation 71(3). Paragraph A2.03 of the Housing Benefit Guidance Manual advises that incapacity to act would cover not only mental incapacity, but also a temporary incapacity following an accident.

As indicated, there is little legislation covering the appointment and supervision of appointees, and also very little casel aw. The result seems to be that the system depends heavily on Benefits Agency practice. More than 200,000 people over pensionable age have an appointee. There is no control over the way in which the appointee exercises his or her responsibility, other than the observations of others, and meanwhile the claimant is effectively deprived of any control over her income. Is the claimant's benefit simply absorbed into the household budget? Does the appointee assume (whether maliciously or innocently) that the appointment gives him or her greater powers than it does, and deal with matters such as the spending of the appointee's capital?

There is no positive monitoring role over the exercise of appointeeship, and while it is stated that the amount of abuse is small, there is no real evidence either way. Denzil Lush has expressed the view that something like 10-15% of registered EPAs are abused (giving a total of some 1000 cases of possible abuse) in an area where there are considerable safeguards. If the same percentage of cases of appointeeship is subject to abuse, this would give a total of something like 20,000 cases of abuse for people over pensionable age alone.

This may sound as if it must be an exaggeration, but the point is that there is no solid information, either as to how appointments are made, or as to how they are exercised. One argument which has been put forward is that appointeeship should be included in the current review of the law on incapacity and decision making. It would seem a small step to take to bring this rather unregulated area into some form of control.

One of the issues which arises from appointeeship is the question of overpayment of benefits as a result of the appointee's actions. This will be considered in the next article in the series in the wider context of overpayment and recovery of benefits.

Alan Robinson. The author is a solicitor and expert on welfare benefits. He is Director of Legal & Welfare Rights Training, and can be contacted on 01724 710 819.