As professionals specialising in Court of Protection work we often hear from clients that they have been told by social services that they have to sell their parents' home to pay their care fees. This is often a very stressful time for families and understanding what needs to be done and why can help make things that little bit easier.
Care fees and care funding is a complicated topic which is outside the scope of this blog but if you do want to check that you and your loved one are being charged correctly you will find some advice here.
I am going to start then from the point that it is accepted that the person concerned will not be able to return to live in their own home and that their placement in a care setting is the plan for the future. The deputy or attorney will need to consider if the property has to be sold to meet the fees for care.
At the start of this series I advised that a newly appointed deputy or attorney should check if there is anything they are not allowed to do. If the Lasting Power of Attorney (LPA) or deputy order does not say anything about buying or selling land or property then you will have the necessary authority to go ahead and place a property for sale, sign the necessary paperwork and deal with the proceeds of a sale.
If there is a restriction stopping you selling a property (in a deputy order this will usually be a clause that says the deputy may not sell any property freehold or leasehold without authority of the court) then you will need to make an application to the court for permission to sell the property before you can put it on the market. To make this application you will need to complete the usual forms for applying to the Court of Protection for a decision about property and affairs (COP1 application form plus a statement in form COP24) setting out why it is in the best interests of the person you act for the property to be sold. The application would usually include:
- The reasons for the sale, for example what the care fees are charged at and when other funds will run out, confirmation that the person whose house it is will not be able to return to live there
- Written valuations from several reputable estate agents giving a recent valuation of the property
- Details of the plans for the proceeds of the sale for example care fees that will need to be paid, debts to settle or investments that are planned
The Court will then consider the application and if it is satisfied that it is in the best interests of the person you act for then you will get an Order giving you authority to sell the property.
If you are a deputy or attorney who is selling a property it is important to make sure that you get the proper market price for the property. This doesn't mean that you have to have to do it up but just ensure that you act on the advice of your estate agent if offers are made. Selling at an 'under value' could cause problems with for example care fees if the transaction was deemed to be a deliberate deprivation of capital. You also cannot sell the property to yourself as this would be a conflict between your own interest and your role as a deputy or attorney, similarly you cannot sell to a close family member or friend. If you, or a relative or friend, want to purchase the property at a full market value then the Court of Protection would need to approve this transaction. Selling the property for less than full value would be considered a gift by the Court too. For advice about gifting please see my blog on that topic here.
Sometimes a property is owned in joint names and only one of the owners has lost the mental capacity to make their own decisions. If this is the case then the Court of Protection needs to appoint a new person to make decisions about the property and sign paperwork for it to be sold, even if there is a deputy or attorney acting for them already. ~The Court of Protection has a special procedure for appointing a new trustee to replace the person who has lost capacity and allow a sale to go ahead.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.