28 September 2021
Judicial Greffe, Viscount, Jersey Bankers Association and the Law Society of Jersey working together to ensure compliance with the Capacity and Self-Determination (Jersey) Law 2016 (the "Capacity Law").
The Capacity Law came into force three years ago, radically altering the way in which the finances of vulnerable Jersey residents are dealt with. Vulnerable individuals are those who may not have capacity to make decisions for themselves by reason of an impairment of the functioning of the brain, for example, dementia, head injury or learning disabilities. The overall objective of the Capacity Law is to uphold the right of vulnerable islanders to self-determination by setting out a modern regime for decision making with them or on their behalf in their best interests. It was drawn up on similar terms in many respects to the Mental Capacity Act 2005 of England and Wales.
The Capacity Law introduced two new offices to support vulnerable Islanders:
Lasting Powers of Attorney
- For the first time, Jersey residents have been able to put in place Lasting Powers of Attorney ("LPAs") drawn up under Jersey Law. LPAs enable the donor to appoint attorneys to make decisions for them and act on their behalf. The advantage that LPAs have over ordinary powers of attorney is that they survive the supervening incapacity of the donor.
- Ordinary powers of attorney, commonly used by Jersey families to support elderly relatives with their finances, only remain valid whilst the donor continues to have capacity to understand and consent to the arrangement. If the donor later becomes mentally incapacitated, then the court must appoint a Delegate (formerly Curator – see further below) to manage that individual's finances. The Delegate is subject to court imposed restrictions and conditions and must report and account annually to the court for all dealings with the vulnerable individual's finances. Having an LPA in place avoids the cost and inconvenience of court proceedings and maintains the privacy of the donor.
- The customary office of Curator has been replaced by the Delegate. If an Islander becomes unable to manage their finances, and they have not put in place an LPA, the Court will appoint a Delegate to act on their behalf. The Delegate is a much more flexible arrangement than the rigid Curatorship regime as each Delegation can be tailored to the circumstances of the vulnerable individual. Under a Curatorship, the person was no longer permitted to participate in their own financial decisions whereas under the Capacity Law a Delegate has a positive duty to involve and support the person in their decision making where possible.
Notwithstanding that the Capacity Law has been in force for almost three years, concerns have been raised as to how banks have recognised these new Capacity Law offices. This resulted in a workshop arranged by the Judicial Greffe for the Jersey Bankers Association supported by the Law Society of Jersey for discussion as to how the banking industry can better serve the needs of vulnerable Islanders.
In the workshop, Toby Farlan, Capacity and Liberty Officer at the Government of Jersey, and Lisa Biddlecombe, the Assistant Registrar of the Probate and Protection Division of the Judicial Greffe, presented an overview of the Capacity Law and the scope of the authority of the two new Capacity Law offices. On behalf of the Law Society sub-committee for Capacity, Succession and Estate Planning, Bedell Cristin's Head of Wills and Probate Donna Withers was invited to attend the workshop and contribute to the learning and conversation. Having advised and acted as LPA attorneys and court appointees for many years, both in England under the Mental Capacity Act 2005 and in Jersey, Donna Withers emphasised what is needed from the banking relationship for vulnerable individuals and their representatives. At the heart of this is recognition that the relationship between the vulnerable individual and the attorney/delegate is that of principal and agent. The attorney/delegate stands in the shoes of the vulnerable individual with power to do anything necessary or expedient in their best interests which is not prohibited by the LPA instrument or Royal Court Delegation Order. Financial service providers may accept and recognise that power and are protected by the Capacity Law in so doing.
The introduction of the Capacity Law to Jersey was a significant step in protecting the rights of vulnerable islanders in accordance with modern standards. With islanders taking advantage of the new regime, it's now time for the finance industry to play its part in safeguarding vulnerable islanders' right to self-determination.
To find out more about
- LPAs – link to LPA Briefing https://www.bedellcristin.com/knowledge/briefings/jersey-lasting-powers-of-attorney/
- the Capacity Law – Briefing https://www.bedellcristin.com/media/2158/jersey-takes-a-step-closer-to-modern-mental-capacity-law.pdf
If you would like any further information, please get in touch with your usual Bedell Cristin contact or one of the contacts listed.