Modern code for adults with incapacity

Capacity is relevant to almost every area of law and legal practice. Issues of incapacity can and do arise in all of those areas. Except that some of the causes of incapacity are in a general sense age-related, the incidence of incapacity is largely random. It is estimated that roughly 100,000 adult Scots at any one time have legally significant impairment of capacity, and that legal issues arising from adult incapacity are likely to affect every family sooner or later1.

Every legal practitioner, in every area of practice, accordingly requires competence in incapacity law in order to meet existing and predictable needs of clients. This should embrace competence not only in the identification, assessment and consequences of impaired capacity, and techniques for responding to incapacity, but also in techniques appropriate in anticipation of incapacity, in situations of deteriorating capacity, and in addressing actual or possible impairment of capacity in parties other than the client for whom one is acting.

As its first major piece of legislation, the Scottish Parliament has created for the first time in Scots law a coherent modern code of provision to meet the needs of adults whose capacity is impaired in relation to decision-making about their personal welfare, and the management of their property and financial affairs. The scope of the Act is broad. The overarching principles in section 11, reflecting what is already regarded as best practice, are likely to influence the decisions of the courts and standards of practice over an even wider area.

The Adults with Incapacity (Scotland) Act 2000 is referred to as “the Act” or “the 2000 Act” in the series of short articles of which this is the first. Their purpose is to alert practitioners to the main features and principal practical consequences of the Act, not to describe the content in any detail. So what changes will be made to existing law and practice, and when? What is the overall scope of the new Act? What general guidance can be given to practitioners when they first approach and utilise the various provisions of the Act?

The Act is expected to be brought into force in some three or four stages, the first on 2nd April 2001 and the last on 1st April 20022. Some well-known techniques will be abolished and others substantially reformed. Major new techniques will be introduced.

From 1st April 2002 no more curators bonis to adults, tutors-at-law, tutors-dative or Mental Health Act guardians3 will be appointed. Petitions and applications then current will continue procedurally under “old” law, but appointees will become new-style guardians. Their powers will be those conferred by the “old-style” petition or application, but otherwise the new guardianship regime will apply to them, subject only to a few modifications.

Existing curators bonis, tutors-at-law, tutors-dative and Mental Health Act guardians when the Act comes fully into force on 1st April 2002 will retain the powers then held but otherwise will become guardians under the new regime, subject to a few modifications. Time-limited appointments will continue for their duration, and indefinite appointments will continue indefinitely. A provision of the Bill explicitly to that effect was dropped during its passage through the Parliament, but (contrary to the impression given by some commentaries and the official Explanatory Notes) that appears to remain the effect of the relevant provisions of the Act. However, time-limited appointments may only be renewed within five years of commencement in April 2002. That, however, would not prevent applications for appointment of a new-style guardian following subsequent expiry: the difference is that procedurally that would be a new application rather than a renewal.

The Act defines adults as persons who have attained the age of 16. A curiosity of the new regime is that while the Act appears to remove curators both to adults and to children from relevant provisions of the Judicial Factors Act 18494, including the definition of judicial factors, appointment of curators bonis to children will remain competent5. Where the ward attains 16 and the curatory does not then end (at any time after 1st April 2002, and whenever the original appointment was made) the curator will become a guardian under the 2000 Act on the ward’s 16th birthday.

Put simply, when the relevant provisions of the Act come into force on 1st April 2002, curators bonis to adults, tutors and Mental Health Act guardians will all disappear, and will be replaced by guardians under the Act. Other substantial changes will occur before that. Major reforms concerning powers of attorney (Part 2 of the Act) and new provisions regarding access to accounts and funds (Part 3) are expected to come into force on 2nd April 2001. These and other reforms are outlined very briefly in this initial article, and will be addressed later in the series.

The Act defines continuing powers of attorney (CPA’s) as powers in relation to property and financial affairs which continue to have effect during incapacity, and welfare powers of attorney (WPA’s) as powers in relation to welfare matters, which may only have effect during incapacity. From 2nd April 2001 existing continuing and welfare powers will come under the new regime, with some modifications. CPA’s and WPA’s granted after that will not be valid unless the requirements of the Act are complied with. These include requirements for certification at time of granting of capacity and of no undue influence, and registration before the power is operated. The sheriff will have supervisory and other powers. Attorneys, both “new” and “old”, will require to comply with section 1 principles (see below).

Part 3 is principally concerned with creating a new, and relatively simple, procedure under which authority may be obtained to intromit with funds in a specified account of a person who has lost capacity, for fairly limited and generally routine purposes. The “withdrawer” will open a new “designated account”. Funds will be transferred at a rate specified in the certificate of authority from the existing account into the new “designated account”, and the existing account will otherwise be frozen. The withdrawer will operate the “designated account”. The other reform in Part 3 addresses the problem encountered by many couples who have opened joint accounts, often with the intention inter alia of avoiding problems if one should lose capacity, only to find that the bank “freezes” the account upon intimation that one has lost capacity6. The 2000 Act (s.32) provides that the account will in such circumstances continue to be operable by the party who still has capacity, unless the terms of the account specifically state otherwise. Practitioners should note this reform with immediate effect in relation to clients opening or operating accounts in joint names - perhaps for commercial purposes - who might wish to specify that this reform should not apply.

Part 4 abolishes the existing scheme of management by hospitals (and only hospitals) under the Mental Health (Scotland) Act s.94, and introduces a substantially improved scheme of management of residents’ finances by “authorised establishments” - hospitals, nursing homes registered with Health Boards, and establishments registered with social work authorities. The scheme will apply to all relevant establishments unless they opt out, and unregistered establishments may register solely for the purpose of bringing themselves within the new scheme. The Act defines the supervisory authorities for various categories of establishment - generally, the authority with which they are registered - but as this may change with introduction of the new Scottish Commission for the Regulation of Care, implementation will be timed to coincide with introduction of the new Commission.

Part 5, likely to be brought into force “in the summer of 2001”, contains three reforms in relation to medical law. Firstly, it creates a new authority to give medical treatment to someone who lacks capacity to give valid consent, or is at the time incapacitated from doing so. Secondly, it contains provisions about medical treatment where a guardianship or intervention order (see below) has been sought or is in force, or where a WPA is in force, with relevant medical powers. Thirdly, it contains provisions about medical research where the subject of research does not have sufficient capacity to consent to it. There is also a general provision about appeals to the courts on medical matters.

Part 6, scheduled for the last instalment of implementation on 1st April 2002, creates an entirely new regime of intervention orders and guardianship orders. Both types of order may cover welfare matters, or financial and property matters, or both. Intervention orders will take two forms. They may direct the taking of specified action, or they may authorise an appointee to take specified action or make a specified decision. Guardianship will be flexible as to powers granted and time-limited as to duration (normally three years initially and five years at a time thereafter). Not only does this new scheme replace curators to adults, tutors and Mental Health Act guardians as mentioned above, it goes far beyond existing provision in the range and flexibility of remedies available, and contains substantial reforms in all aspects.

Part 1 contains the overarching “section 1 principles” which apply to every procedure and every appointment under the Act, and the fundamental definitions of “adult”, “incapable” and “incapacity”. It confers a new jurisdiction upon the sheriff (who will also have jurisdiction in relation to intervention and guardianship orders under Part 6) and other provisions regarding judicial proceedings; general provisions regarding the Public Guardian (formerly the Accountant of Court, but with a much enhanced role), the Mental Welfare Commission and local authorities; and provisions regarding matters such as investigations and codes of practice. Part 7, as well as dealing with customary “final part” matters, creates a new offence of ill-treatment or wilful neglect, and provisions about civil liability and (if certain criteria are met) exemption from civil liability.

To conclude this first article on the Act, four points of general advice are offered.

Firstly, in all matters concerning the Act and touched by the provisions of the Act, the overarching principles and fundamental definitions in section 1 should be borne in mind: not in the back of the mind, but at the front, at all times rigorously and fully referred to and complied with.

Secondly, although this article commenced with a “what will change” approach, the new code created by the Act, and in particular the new scheme of intervention and guardianship orders, should be approached as an entirely new body of law, significantly different in scope, content and fundamental principles from existing provision.

Thirdly, there will be significant dangers in “cherry-picking” individual sections or Parts without having an overall grasp of the Act as a whole. Some examples may be given of the dangers. The overriding importance of the section 1 principles is not referred to throughout the individual provisions of the Act, but affects them all - and it is only in the 82nd of 89 sections that one discovers that any non-compliance with section 1 principles will remove the exemption from civil liability in that section. The various provisions requiring intimation do not refer to the provisions of section 11 stipulating circumstances in which intimation should not be given. Potential liabilities of guardians are contained partly in Part 6 (e.g. s.69), partly in Part 7 (e.g. s.81) and partly in Schedule 2 (paras. 8 (6) and (7)), and other provisions concerning management by guardians are split between Part 6 and Schedule 2 without any obvious logic. Probably due to the substantial amount of amendment during the passage of the Bill, the final structure is at times in other respects illogical. To take an example from Part 1, section 8 dealing with expenses of proceedings and section 14 on appeals to court against decisions as to incapacity should logically be grouped with sections 2-5, all dealing with judicial proceedings, but section 8 divides sections 6 and 7, containing general provisions about the Public Guardian, from sections 9 et seq. dealing with general functions of the Mental Welfare Commission and local authorities and matters common to the Public Guardian, Mental Welfare Commission and local authorities, and these are followed by section 14 at the end of this Part. Another example is the way in which section 32 on joint accounts is interjected among provisions regarding the new “withdrawer” scheme.

Finally, beware of errors in the Act, particularly in the first HMSO print. Some, particularly erroneous cross-references to section numbers, are remedied in Current Law Statutes and should be in subsequent HMSO prints. Others, as mentioned in footnote 2, are expected to result in exclusions from commencement orders. Those which remain require intelligent and informed interpretation on the basis of the presumption that the Parliament intended them to have meaning, and a meaning which is coherent in the context. These articles are directed at busy practitioners, but any with time to spare may find entertainment in considering what section 70 (2) adds to section 70 (1); or in making sense of (and counting the errors in) paragraph 4 of Schedule 4 - especially the first HMSO print thereof; or counting errors in Schedules 5 and 6 (starting with para. 14 of the first HMSO print of Schedule 5). Also, the official Explanatory Notes are generally excellent, but occasionally open to query.