‘Can I protect my home from care fees’ is one of the most common questions that I am asked by my clients, the answer to which is indefinite.

As a general rule, if your assets are more than £23,250 including your property, you will have to fund your care yourself. This ‘means testing criteria’ often makes people panic that all of their hard earned savings and property could potentially be used up to pay for their care. This can sometimes lead to parents giving away their home to their children in their lifetime in the hope that it will then not be used to pay for future care fees. This is a very risky solution and certainly something I would rarely advise. Amongst the risks include children forcing their parents out of their home, divorce or death of the children meaning the property has to be sold or the local authority clawing back the value of such property if they class the gift as ‘deliberate deprivation’. 

So What can I Do?

An easy and guaranteed way of not only protecting half of your home from care fees but also protecting it from second marriages, is to set up a Property Protection Trust (PPT) in your will.

The Trust works by severing the joint tenancy of property owned by two spouses and changing the ownership to Tenants in Common. This means that both spouses own a specific 50% in the property which they can they give away in their own Wills. The Wills are then drafted to leave your 50% share in the property to your children or other family members, rather than to the remaining spouse. This ensures that if the remaining spouse goes into care, only their own 50% share in the property can be used to pay for their care and the 50% share of the property of the spouse who has died is protected. The remaining spouse is entitled to live unrestricted in the property as if they own the whole, but legally they only own half. 

The Trust also ensures that if after the death of the first spouse, the remaining spouse then re-marries and subsequently changes their Will, your children will always be guaranteed to get your half value in the property no matter what. 

So Can I do This? 

To set up a PPT you will need to be married or cohabiting and both parties must have full mental capacity in order to change their Wills. You must own a property jointly, however if the property is only owned by one spouse, we may be able to transfer the property into joint names and then set up a PPT for you.

A PPT may also be set up if one spouse has already died leaving everything to their remaining spouse. This must be done within two years of their death and requires drafting a Deed of Variation. 

Are There any Risks?

 Like with any type of trust, we would need to speak to you and discuss your individual circumstances to ensure that you understand the trust and that it is beneficial to you. The PPT can not be challenged by a local authority as you are not ‘deliberately depriving’ yourself of assets, but merely leaving what you own as an individual to your children in your will, rather than to your spouse. 

Overall a PPT is a relatively simple, straightforward and cost effective way of ensuring that your share of your house is potentially protected from care fees. 

Please contact Jennifer Wilkinson or Sarah Charnley on 01704 532890 or 0151 928 6544 if you would like to discuss making a PPT in more detail.

Many people, particularly the elderly who are being cared for in nursing home settings should be entitled to the full cost of their care being met by the NHS.

If your needs are primarily of health then the NHS should pay for all of your care. This is the same care that would have been provided in hospital 20 odd years ago, but which today is more likely to be provided in a nursing home setting.  In 1999, this was confirmed in a Court of Appeal judgement involving a tetraplegic lady, Pamela Coughlan who challenged her local health authority in Exeter and won. Locally, the NHS publish ‘eligibility criteria’ setting out in their area, who is and who is not eligible for free care, although there is concern that most if not all of those currently in operation are unlawful and not Coughlan compliant.  Many people should qualify but are being told that they are not eligible as their care needs are classed as social care and as such, it is something for which they must pay.

No one should move into a nursing home setting without checking that they qualify, as many people are not told that they might be eligible or the procedure for reviewing the decision. With care fees costing anything between £450- £1,500 each week, it is vital that residents, their families and carers get advice. If they ignore it, the financial loss to them is huge.

If you feel that a loved one should have received NHS funded Continuing Care payments, you may be able to make a claim and ensure that their care home fees are fully paid for by the NHS. All you have to do is contact us and we can talk you through the process and make an initial assessment to see whether it is worth making a claim.

It is important to have as many details about the person in care, which relate to their total care needs, such as:
a. Behaviour
b. Cognitive Impairment
c. Communication
d. Mobility
e. Nutrition
f. Continence
g. Skin (including tissue viability)
h. Breathing
i. Drug Therapies and Medication
j. Psychological/Emotional Needs
k. Seizures/Altered States of Consciousness

You will need to have or get records of the date the person went into the home and what their total health care needs were at that time with details as to how and when their health deteriorated. You will also need details of what money was paid for care for the period you wish to claim for.

For more information and advice contact Sarah Charnley on 0151 928 6544 0r 01704 532890

Recently I have been surprised to discover that some of my clients are unsure of the difference between owning a property as Joint Tenants or Tenants in Common and more importantly the implications of such.

Although both types of ownership provide for the owners to hold the property jointly, the rule of survivorship applies to Joint Tenants. This means that if one of the joint tenants dies, their share of the property automatically passes to the survivor, despite what their will may say.

The demand for properties to now be owned as Tenants in Common is growing and perhaps rightly so. This type of ownership gives more flexibility and allows the owners to actually own the property jointly, but each actually owns a distinctive share (usually 50/50). This specific ownership of a share in the property means that they can therefore give it away to someone else in their will if they wish.

The most common need for this and what I often discuss with clients is the protection of half the property if one person goes into care and is responsible for paying care costs. Take my examples below of a property which is owned by a husband and wife:

Tenants in Common

Husband and wife own the property 50/50 and they leave their respective shares to their children in each of their wills. Husband goes into care and wife subsequently dies. The wife’s share of the property passes under her will to the children rather than to the husband. It is therefore only the husbands share in the property which can be used to pay for his care costs.

Joint Tenants

If the property was held as joint tenants, on the wife’s death it would have all passed to the husband and therefore the value of the whole property could potentially be used to pay for his care costs.

The recent case of Quigley v Masterson (2011) highlighted the need for the severance of the joint tenancy to be done properly. There are certain criteria that need to be met in order for the severance to be complete. These are very simple, but critical in ensuring it is done. It is worth noting that this severance can also be done if one owner has lost capacity.

It is not only the issue of protecting some of the property from potential care costs which makes this course of action relevant. It is often useful for family’s with step-children, second marriages and unmarried couples.

Changing the ownership from Joint Tenants to Tenants in Common if fairly straightforward, however it is the person’s will that needs to be drafted carefully following the severance. If you would like any further information regarding your property or will, please contact Jennifer Wilkinson or Sarah Charnley.

Those of you who tune in to the Jeremy Vine Show on Radio 2, may have heard the recent show aired on Friday 22^nd July about writing a will.

The guest on the show was Adam Sampson, Chief Legal Ombudsman and discussions centred on a phone in from disgruntled clients of both will writers and solicitors.

One of the issues that was discussed is the regulation of both solicitors and will writers. In my opinion, the show did not emphasise enough the fact that will writers are mostly unregulated. Therefore if legal work provided by a will writer is incompetent, effectively there is no recourse for the client. On the other hand, if a solicitor is incompetent, then the client has several avenues from which to seek a remedy. 

Although we all, as solicitors, strive to meet the highest standard of client care for all of our clients, there will inevitably be a small minority who let the profession down or in indeed make a mistake. The fact that there is then an independent body to whom the client can go to to complain if a solicitor has acted incompetently, surely makes the choice of whether to use a solicitor or a will writer a simple one. 

A discrepancy in the show that I picked up on was that beneficiaries can not be executors. This is in fact untrue. In most wills that I draft, the beneficiaries are also the executors. There is no ‘law’ preventing them from acting as executors if they are also a beneficiary. In fact, in simple estates, it is often the most efficient thing to do. It is only in situations where there are family disputes, minor beneficiaries or acomplex estate that appointing someone other than the beneficiary is useful. 

In my initial meeting with all new will clients, the role of the executors and who is best appointed is always discussed in depth so that the most suitable person or persons are appointed.

It is understandable why people find talking about death and later life planning difficult, however, considering the implications of not doing so, it is surprising.

Following the recent ‘Dying Matters Awareness Week,’ a recent study has indicated that a large number of adults are not talking about later life planning, such as making a will, setting up a Lasting Power of Attorney or tax planning.

You may therefore ask yourself, ‘What are the consequences of not discussing such matters?’

Putting these issues at the bottom of your ‘to do’ list or to the back of your mind can result in a number of complications and costs both during your lifetime and upon death.

Not writing a will could mean that you die intestate and your estate would then pass under the intestacy rules. The order in which your estate is passed to a member of your family is often not what you would have wanted. Dying intestate can also delay the administration of an estate.

Failing to make a Lasting Power of Attorney can result in court applications and substantial legal costs not to mention putting a considerable amount of stress on family.

Ignoring tax planning issues could increase your inheritance tax liability, which is charged at 40% and could therefore leave your loved ones with less.

Further issues which also seem to be dismissed too quickly are care needs and care costs. The research found that just 11% of people have talked to family about their care preferences and even less have sought legal advice about paying for such care.

Professor Mayur Lakhani, GP and chair of the Dying Matters Coalition summed up the findings of the research by saying ‘As a practising GP I know that many people are frightened to talk about dying, but avoiding the subject is not in any of our interest.’

If you have any concerns about any of the issues raised in this blog, please contact Jennifer Wilkinson or Sarah Charnley.

The Law Society has recently launched a campaign calling on the government to make will writing a reserved and regulated activity.

You may ask “What is a ‘reserved activity’?” 

This is an activity which must be authorised and regulated by The legal Services Act 2007 and means individuals or Companies who offer these services are regulated.

 So you may think that anyone who offers will writing services must be regulated? – WRONG!

In fact  a large number of will writers are entirely unregulated and can prepare wills without any training or insurance protection. Therefore, if the will is drafted incorrectly, the affected person or persons do not have any call for redress.

Many people are unaware that anyone can act as a will writer and advertise their services as such.  

You may think that since will writing is an legal activity that only qualified people can undertake this work? – WRONG AGAIN!

Drafting a will can be a complex matter, even if it seems relatively straightforward. Many factors such as children from a previous marriage, complicated family set-ups and tax complications, mean that accurate advice and planning is needed when drafting a will. 

Some examples given to the Law Society as evidence of common problems in the unregulated sector include practices such as inappropriate selling techniques, excessive or unreasonable costs, fraud and poor quality drafting.

Therefore the overall compelling message from the report is to ensure that whoever you appoint to draft your will is sufficiently regulated and qualified to give you proper and adequate advice. 

ALL qualified Solicitors work under a tough regulatory system that includes a number of protective elements for clients. 

ALL qualified Solicitors are regulated by the Law Society and must have adequate insurance in place.

If you would like to speak to one of our Solicitors about making or updating your will or perhaps you have had a will made by a will writing company and would like it checked, please contact Jennifer Wilkinson or Sarah Charnley on 01704 532890 or  0151 928 6544.

For further information go to:

http://www.lawsociety.org.uk/new/documents/2011/LS-Regulation-of-Will-Writers.pdf

The initial episode of the BBC2 documentary ‘You Can’t take it With You’ which aired on Friday 14^th January, highlighted the problems experienced by families when deciding to make a Will.

The first episode focused on two couples trying to make decisions as to how their assets should be divided on their death. In both scenarios, difficulties arose in deciding whether children from a previous marriage should be included and how the estate should be divided.

 The tense and slightly awkward meeting between the families to discuss their Wills did not make easy viewing and it is not hard to see why people tend to sweep these issues under the carpet and put off making their Will as a result. This can then lead to not only a person’s estate going to people they would not have chosen but also in some circumstances, more tax being payable. 

However the programme acutely illustrated that discussions and disagreements between the families in the end paid off, as each couple made wills that they were happy with and most importantly benefitted the intended persons. 

A point I felt was illustrated well in the programme, is that you do not have to leave your assets to someone outright. Many options can be considered such as a life interest trust or discretionary trust. All of these different options can be discussed and considered in a meeting with a solicitor. 

I would urge anyone with any sort of issue to watch the next five episodes, which promise to deal with multiple scenarios which often deter people from making a Will. As a solicitor, I hope to be able to seek to resolve these issues and draft wills to avoid leaving uncertainty behind for your loved ones to sort out. 

In my opinion, the most valuable message conveyed in the programme, is that not making a will is not an option, particularly for those with complicated family setups. In fact, I would go so far as saying not making a will is not an option in any circumstance!

‘What would happen to your assets if you lost the capacity to deal with them yourself during your lifetime?’

It may surprise you to know that if this were to happen and no measure had been taken in advance, an individual can not simply take charge of your affairs on your behalf, even if they are your spouse. In order to deal with any assets that are in your sole name, they would need to apply to the court to be appointed your deputy. This process can take around 4-6 months and is very costly. Banks and financial institutions will not allow access to any funds in the sole name of the person who has lost capacity unless a Deputyship order has been presented to them or indeed a Lasting Power of Attorney (LPA) is in place.

This presents the question:

‘What can I do to ensure that someone can easily take charge of my finances if I lose capacity?’

The answer is very simple, make a Lasting Power of Attorney.

A Lasting Power of Attorney gives another person the right to make decisions on your behalf in respect of either your property and finances or your welfare. An LPA can even be used if you still have capacity to make those decisions but would like assistance in doing so, for instance if you need help setting up direct debits and need a relative to do it for you. There are two types of LPA, the most common one deals with property and finances and there is also one dealing with welfare. An LPA can not be used until it is registered with the Office of Public Guardian.

A question often asked is:

‘What if I never lose capacity or need help with my finances, I will have wasted my money?’

The answer to this is of course yes, however we see making an LPA as a kind of insurance policy. Like with your car or household insurance, it is unlikely you will ever make a claim on these policies, but you have them in place to make it easier and cheaper in case you do. Making an LPA is exactly the same. We all hope we never lose capacity, however it is a stark fact of life that an increasing number of people lose mental capacity. Recent estimates suggest a staggering:

• 1 in 3 people are likely to suffer from some sort of dementia,
• with more than 35 million people worldwide currently estimated to have dementia.

At Breens Solicitors we believe that making a Lasting Power of Attorney is equally if not more important than making a Will. Having an LPA in place ensures your family can continue to manage your affairs on your behalf without involving the court and without the delay involved in making an application to the court.

If you would like to discuss making a Lasting Power of Attorney in more detail please contact (Breens Solicitors /Jennifer Wilkinson/ Sarah Charnley) at either our Southport or Waterloo office on 0151 9286544 or 01704 532890.