Buying and selling a property as a Deputy

Being a Deputy holds a lot of responsibility. Whether you are a Deputy for a friend or family member, understanding what is in your loved one’s best interests can be challenging and even emotional.

As a Deputy, some decisions you make are relatively straightforward. But others will be far more significant and complex, such as buying or selling a property on behalf of the Protected Party (‘P’).

In this blog, our Court of Protection solicitors explain what you need to consider when buying and selling property as a Deputy.

Do you have the authority to buy or sell a property?

When it comes to buying and selling property for a Protected Party, the first thing you need to consider is: do you have the authority to do so?

If you aren’t sure, it should say in the Deputyship Order whether you have the authority to buy or sell a property for P. When the Court of Protection granted your deputyship, this will have been issued to you. If you can’t find your Deputyship Order, you can ask the Office of the Public Guardian (OPG).

Joint ownership

If P has joint ownership of the property and the other party also lacks capacity, you may need to apply to the Court of Protection to become a Trustee. If you are both the Deputy and a joint owner, there may be a conflict of interest. You should therefore seek legal advice before going any further. Read about how we helped a client recover £100,000 from his life cover policy after his partner, the sole Trustee, lost capacity.

Applying for authority if you don’t have it

Not all Deputies have the authority to buy or sell a property. If your Deputyship Order does not mention property sales, you will need to apply for authority from the Court of Protection. This can take several months, so it is wise to wait for approval before engaging with an estate agent.

The type of application you need to make and the information that needs to be included are very specific to P, which can be complex. It’s important to check that the Deputyship Order grants the exact authority you are seeking. This is why it’s crucial that the initial application is filed correctly and clearly sets out what you are hoping to achieve on P’s behalf. If, for example, you receive the Order and it’s rejected by the Land Registry, the sale and/or purchase will not be able to complete until you have gone back to the Court for any revisions needed and been issued a new Order.

Some historical Deputyship Orders grant general authority to purchase and sell. However, our Court of Protection solicitors are seeing a real push back on this from the local authority, so it may be that an application is still needed. If you are unsure, get in touch, and we can help review the Order and provide tailored advice as to what you need to do next.

If you attempt to market P’s property without authority, it could lead to significant delays and even legal action.

What to consider when buying a property for P

If you are seeking authority to buy a home for P, the Court of Protection will want the following evidence to show that the purchase has been fully considered:

• Why this particular property is in P’s best interests (area, suitable for any physical needs they may have, and local amenities, etc.)
  • You will need supporting evidence, e.g. an Occupational Therapist’s or case manager’s report.
• That it is affordable for P, with evidence from their financial advisor and of capital, income and expenditure.
• P’s thoughts, wishes and feelings regarding the purchase.
• If it needs to be adapted to be made suitable, the estimated scope of works and costs for doing so, if it is possible to say at this stage.
• Anticipated disbursements (conveyancing fees, local searches, surveys and moving costs)
• Who will be living with P, and whether there are any care arrangements.
• Confirmation on how the property is being purchased, i.e. jointly or with a charge on the title.

If you are seeking to place a charge on the property, the Court will need extensive evidence that this is in P’s best interests. Generally, the Court of Protection is not keen on granting authority to place a charge over P’s property if it can be avoided.

If you already have the authority to purchase a property for P, you still need to evidence that all best interest considerations have been made as part of your annual report to the OPG.

What to consider when selling a property as a Deputy

One of the most common reasons for a Deputy to sell P’s property is to release funds to pay for their care. However, it is also not unusual for P to need to downsize to a more accessible home as their condition advances.

Before putting the property on the market, you should consider:

1. Is it within P’s best interests? Is it necessary to sell their home, and could home adaptations be more beneficial?
2. What is the plan for P in terms of accommodation once the sale is complete?
3. Do you have evidence of capital, income and expenditure?
4. How will this, if applicable, impact P’s care arrangements?
5. What are P’s thoughts, wishes and feelings regarding the sale?

Selling a home is a big decision. But even though P lacks the mental capacity to decide for themselves, it is still a good idea to ask them what they want (even if just for reassurance), even if they cannot make a final decision.

It is also worth considering what they would want to do if they had capacity; for example, did they express that they wanted to stay in their home at all costs?

Selling P’s property

If you have bought or sold a property before, you will be familiar with the conveyancing process. However, selling the property on someone’s behalf has its own process and complexities.

Here are our top tips for selling a Protected Party’s property:

• Choose a conveyancing solicitor with experience in property sales for those who lack capacity. The same applies to the estate agent.
• Ensure P’s property is sold for a fair market value. It can be tempting to list the property at a lower price point for a quick sale with the aim of releasing funds as soon as possible. However, if you sell the property below the market value, you could face legal action from the OPG.
• Seek three sale valuations, evidencing that the property is being placed on the market at a fair and reasonable price.
• Inform the OPG of the sale so they can update their records, which is particularly useful should anyone question the sale later on.
• Get your paperwork ready! When your solicitor exchanges contracts, they will need a copy of your Deputyship Order or court approval. If you do not have this available, it could delay the completion.

Proceeds from the sale

Once the sale completes, the proceeds will go into the Deputyship account, and this must be used in P’s best interests. You will need to include this in your annual report to the OPG.

Other considerations when buying or selling as a Deputy

In addition to the Court application, a Deputy needs to consider and manage the following as part of any sale or purchase, both in the build-up to and post-completion:

• Transfer of utilities
• Insurance requirements
• Logistics of moving P and their belongings to their new home
• Ensuring funds, particularly if there is no connected sale, are readily available for exchange and completion
• Coordinating any surveys and adaptation works
• Reviewing and signing sale, purchase, or works contracts on behalf of P
  • Be mindful of the wording used to ensure you are not accidentally taking on any personal liability!

Further information

For advice about buying or selling a property as a Deputy, or if you are unsure about your responsibilities as a Deputy, our solicitors can help.

For an initial chat with a member of our Court of Protection team, call us on 0117 325 2929 or fill out our enquiry form.