The recent Rosamund Pike Netflix film ‘I Care A Lot’ and the high profile “Guardianship”/Conservatorship of Britney Spears by her father certainly raise some very worrying and concerning themes that no one would want to happen to their own personal affairs. The thought that a third-party intermediary could come in, without your control and take over either you or your loved ones’ money and assets to their own financial gain is certainly an unsettling proposition!
Whilst the tabloids have made us all quite aware of what can happen in certain states in America, should those of us who live in Scotland be concerned about this happening to us? The short answer is no, but there are important steps we can all take to ensure our families avoid unnecessary stress, cost and uncertainty should the worst happen.
Spoiler: the procedures of a Scottish Guardianship are unlikely to make it into a Netflix thriller or onto tabloid headlines!
Can Guardianship be avoided in Scotland?
Yes! The important thing to remember is that all of these concerns can be very easily removed by ensuring that you or your loved ones have a Welfare and Financial Power of Attorney signed, completed properly by a Scottish solicitor and registered with the Office of the Public Guardian. A Power of Attorney allows you to personally appoint the individuals you would wish to look after your personal affairs – normally your closest relatives, friends or a professional like a solicitor or an accountant. The potentially worrying thought of having a someone unconnected to you dealing with your affairs is immediately brought out of the equation and you can decide who would have the right be involved with these things. My colleague, Paul Nash, covers Powers of Attorney in greater detail in his recent post.
Guardianship in Scotland
Well what happens if myself or my loved ones do not have a Power of Attorney in place and we then lose capacity?
This happens more than you would imagine and our Guardianship Teams throughout Scotland deal with 100’s of applications a year. Scottish Guardianship is a long process that involved a person’s family applying to court to obtain similar rights to that granted under a Power of Attorney. Importantly, Guardianships can only be applied for on behalf of someone who has been diagnosed as being incapable of managing their own affairs. Therefore, the American “Guardianship” situation that Britney Spears and the unlucky victims of ‘I Care A lot’ found themselves in is unlikely to arise in Scotland.
Thankfully, whilst this is a difficult and lengthy process for the family to go through, there is some solace in knowing that this area of Guardianships is, quite rightly, highly regulated and the misuse of guardianships powers is rare.
The Office of the Public Guardian (OPG)
If Rosamund Pike’s character in ‘I Care A Lot’ had been operating a Financial Guardianship in Scotland in the same manner, the OPG would have had quite a few things to say about it!
The OPG is a public body that oversees Financial Guardianship Orders in Scotland. It places onerous duties on Financial Guardians that requires them to report and account on a regular basis. Once appointed as a Financial Guardian through the Court, Guardians have to submit an Inventory and a ‘Management Plan’ to the Office of the Public Guardian within three months of being appointed as a Guardian. This informs the OPG (1) what assets form part of the Adult’s estate at the granting of the Order and (2) what the guardians plan to do with the assets as the Order progresses. The OPG has a hands-on approach to Financial Guardianships and Guardians have to prepare and submit annual accounts detailing all of the incomings and outgoings of their dealings with the Adult’s affairs. In the event of poor accounting and, in rare occasions, misuse of funds, the OPG would become aware of this quickly and would move to have the Guardian removed by Court. This is an excellent safeguard to anyone worried about this situation and prevents any substantial wrongdoing from going unnoticed.
Bond of Caution
As well as the duties detailed above, if an estate is of a significant value (normally over £10,000 or so) the court will almost certainly request that an insurance policy is put over the estate, known as a Bond of Caution (pronounced “Kayshun”). This protects the estate from any wrongdoing of a Guardian so if the Guardian simply empties the account and buys a sports car, the Bond of Caution should then kick in and cover any misappropriation of funds by the Guardian. This is a further safeguarding of the Scottish Guardianship procedure in Scotland that perhaps the United States could learn from.
So I don’t need to do anything then?
Wrong! Whilst all of the checks and balances in place for Financial Guardianship in Scotland should give you some peace of mind if the worst were to happen, you or your loved ones should still ensure you have a Power of Attorney in place appointing the people you wish to act for you. This avoids the lengthy, costly and onerous job of applying for Guardianship and takes away a lot of unnecessary stress from the family. The role of guardian brings onerous duties that should not be taken on lightly and, as a result, everyone should ensure they have a Power of Attorney in place. Powers of Attorney themselves are, however, complex documents and you should always get a specialist solicitor to assist you with these. They also have their own pros and cons, so you need to be fully aware of how these work and that they are put in place correctly.
Blackadders are experts in this area and we can guide you through the whole process or either Power of Attorney or Guardianship. We have a specialist Guardianships and Wills and Powers of Attorney teams in all of our offices across Scotland and would be happy to advise you on any of these points. Please always ensure you seek legal advice from a specialist solicitor before proceeding with either a Power of Attorney or a Guardianship Order. Get in touch with Blackadders’ Private Client Team working in Aberdeen, Dundee, Edinburgh, Glasgow, Perth and across Scotland.
John Dargie, Partner
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