Jack Cundick of A&M Bacon gives some tips for deputies on claiming for the time spent making payments on behalf of a protected party.
Making payments on behalf of the protected party has been an area of work that has been within the remit of the deputy since the outset of deputyship appointments. Be it routine utility payments or much more substantial transfers of funds in relation to more complex areas of the protected party's affairs, payments cannot be avoided in the efficient management of the protected party's affairs.
This article aims to explore the methods that can be adopted by your firm and approaches that we use to ensure that reductions to assessed costs are minimised. It will be of interest to anyone who deals with the management of a protected party’s affairs and hopes to send a bill for provisional assessment.
Whilst the need for payments has remained constant over the years, the method by which payments can be made has seen some drastic changes and streamlining from the banks has led to the court rethinking the time that can reasonably claimed for these payments.
It was established in the 2004 case of Leighanne Radcliffe  EWHC 90039 (Costs) that routine payments should take no longer than a half unit of time at a grade D fee earner rate to reflect the complexity of the work that is being carried out. Unfortunately for practitioners, this time has been set to include any further time that may be incurred in reviewing the payment or updating internal financial documentation.
The Office of the Public Guardian (OPG) have supported this decision as clearly stated in the guidance they released in relation to professional deputy costs, in their SD9 document. This advice states :
“Three-minute units will usually only be allowed in respect of paying bills either by electronic transfer, cheque or enclosure letter. No further time will usually be allowed for updating records with details of any payment.”
This can be seen as a somewhat disheartening approach to see the court take, especially when deputyship accounts have been chosen in the best interests of the protected party that have compulsory secondary authorisation measures in place to ensure that the account is as secure as can be. The guidance contains no parameters for these security measures or for internal financial reconciliation approaches that facilitate the efficient management of the protected party’s financial affairs. As cost draftsmen we fully understand the obligations placed on the deputy with regard to reporting to the court and the OPG. It is also paramount that security measures are in place these days with increasingly complex cases of cyber crime and fraud.
Reductions as a result of these strict payment rules are something that we see very frequently, with it being one of the most common areas on which we have to provide advice. Whilst each reduction may not reflect a large loss of profit costs, it is an area that can really add up over the course of a bill. This is especially pertinent when a large volume of individual payments are unavoidable in the management of the protected party's affairs.
The advice we give practitioners is to attempt to adjust the payments at source so that any reductions to submitted profit costs can be mitigated. We implore you to see whether your time recording software has the capacity to submit entries at half a unit, or to set up a bespoke bill paying fee earner that ensures that the time claimed at the outset is limited to reflect what you will be able to recover upon assessment, by setting an hourly rate at half of the usual grade D rate applied for your local area in which you practice. This approach also brings with it added advantages; you will not accrue excess WIP, for which there is little or not chance this will be recovered and will also assist you in estimating your future costs required for the OPG105.
Failing the above, your draftsman should be able to apply a mix of software and cost drafting expertise to ensure each individual payment is isolated and claim it at half a unit of Grade D fee earner work.
By adopting either of the above pre-emptive approaches, you can ensure that upon receipt of your assessed bill there are no nasty surprises and large reductions surrounding the making of payments.
There are, however, occasions that arise whereby the payment is not routine in nature and does require the input of senior fee earner and a slightly increased time claimed. This may involve larger payments in relation to the transfer of funds between currencies or the payment for adaptation works that greatly exceed the sums and complexity a small phone bill!
On these occasions, by providing all additional information surrounding the payment to your draftsman, we will be able to ensure that the entry closely establishes the complexity of the work and your draftsman will be able to provide justification as they see fit to ensure that reductions are not made for this additional time.
When claiming time for any internal procedures such as updating financial documentation, we feel the best approach is to separate these from the payments that are being made so that they can be entered with an appropriate narrative and not simply lumped in with the payment. This approach has resulted in a better recovery and it allows us to provide as much justification and sufficient wording within the narrative to maximise recovery.
We feel that the best course of action in relation to payments is to mitigate any reductions that may come as a surprise upon assessment at the outset through ensuring that payments are claimed correctly. The careful consideration of each entry narrative relating to more complex payments or any compulsory firm financial updates should negate, or at least minimise any further reductions.
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