Successfully defending Local Authority allegations of deliberate deprivation of assets

Family members often fall into the deliberate deprivation of assets trap because they have acted with the best of intentions, thinking that they are helping their parents.

Let me explain with the following scenario….

After a lifetime of working and paying her taxes, your mum’s hard-earned savings are being swallowed up by care home fees.

When you visit her at the care home you are upset to discover that someone in the next room is receiving their care free of charge.

Apparently, they spent all their life savings on holidays, cars and a comfortable lifestyle, while your mum scrimped and saved all her life to put a little bit by for a rainy day.

The result is that both elderly people are living in the same residential home, receiving the same care but your mum has been told to sell her home and her savings are being eaten away while the other person’s care is being funded entirely by the Local Authority. It’s enough to make your blood boil!

The prospect of such a situation results in some family members taking drastic action in a bid to avoid care fees.

And this is where they often come unstuck. Many relatives understandably – but wrongly – think the way to avoid care fees is to move their parent’s assets. By transferring these assets into a family member’s name, they believe that they can protect their parent’s home and savings.

At Steene Law we specialise in Adult Care Fee Law and we are regularly asked to defend allegations of deliberate deprivation of capital or income.

Relatives also phone us for advice, asking if the action they are considering taking could be considered by the Local Authority to be deliberate deprivation – sometimes referred to as capital reduction?

The law on what is considered to be ‘deliberate deprivation’ is confusing.

The guidance in the Care Act says that a person should be free to spend their money as they wish. However, in the same paragraph it says that nobody should be kept at the expense of the State. We told you it was confusing!

So, how do you navigate these conflicting statements? The answer is that when the Local Authority conducts a Financial Assessment, known as a means test, it must prove that the significant motivation, for either the transfer of the asset or the spending of the money, was to avoid care fees.

One common scenario is where people have been persuaded to transfer assets into a trust.

At Steene Law we often come across people who have been conned by companies that advertise on the internet, claiming that by putting property into a trust you can avoid care fees. 

One of the worst examples of trusts mis-selling is the Universal Wealth trusts scandal. You can read more about it here.

Let us be clear – putting a property into a trust to avoid care fees does not work. In our experience, the promises made by companies that sell trusts as a way of avoiding care fees are untrue.

This results in heartache for the family. Their loved one has often paid thousands of pounds for a completely ineffective trust and the family then have to deal with the consequences of this crude and unsuccessful attempt to avoid paying care fees.

At Steene Law we have successfully helped families fight Local Authorities who have made allegations of deliberate deprivation.

Often our investigations have revealed that the Local Authority has failed to comply with the law.

In some cases we have been able to successfully demonstrate that the significant motivation was not the avoidance of care fees and, there have been situations we have been able to show that the asset the Local Authority is seeking to get its hands on, has had the incorrect value put on it.

The moral of the story is this: if you receive a letter from your Local Authority claiming that there has been a deliberate deprivation or they are treating a relative as having nominal capital, you should call us urgently.

Pick up the phone and call us on 0203 653 0623 for a FREE initial telephone conversation. 

We are available from 8am to 7pm, Monday to Friday and will explain your options including how you can fight an unfair deliberate deprivation allegation.