F v R [2022] EWCOP 49

Best interests decision arising from an application by R's father for authority to execute a deed of settlement so that R’s inheritance is held in a disabled person's trust.

R, in his thirties, has a lifelong disability and it was agreed he lacked capacity. His mother’s cousin (T) had died three years ago and left a third of his estate - in the region of £400-600k - to R absolutely. This application was made by R's father, who is also his property and affairs deputy. The underlying basis of the application was that this change would best match T’s intentions and would mean R’s means tested benefits would be protected. The OS, as litigation friend, viewed it differently agreeing that there would have been a considerable advantage to R if T had instead placed that inheritance in trust, as the funds would then be disregarded, but that is not what occurred.

HHJ Hilder, after reviewing the relevant case law including SM v HM and Watt v ABC, refused the application for, among many reasons:

• there was no indication that T had been seeking to preserve R’s benefits: he was quite happy with the prospect that management of any bequest would be by R's parents as deputies [41]
• the proposal would take R's only capital outside the oversight of the OPG - which carried risks - and there was potential for adverse tax consequences if the scheme is regarded as illegitimate [44]
• the Court cannot bind the local authority or the DWP as respects the benefits implications of the proposal [46] and cannot endorse a proposal whose purpose is to preserve an eligibility for benefits which Parliament has decided does not exist. [51]

While the judge and the OS understood why the application had been made “the Court has to make its decisions on the basis of what is known actually to have happened, rather than what might have happened.”
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Read the full judgment