Solicitors Step In to Protect Vulnerable Assault Victim's Compensation
Victims of violent crimes or serious accidents often receive very large sums in compensation and that creates obvious risks of mismanagement or exploitation. A recent High Court case showed why it is always best to engage an independent professional to ensure that does not happen.
The case concerned a man who suffered severe brain injuries in an attack and was awarded more than £1.7 million by the Criminal Injuries Compensation Authority. The incident rendered him incapable of dealing with his own financial and property affairs and his sister was appointed to act as his deputy by the Court of Protection (CoP).
The money was invested in a court account for his benefit but, over a period of about three years, his sister withdrew funds from the account, almost £1.4 million of which was unaccounted for. An investigation was launched after concerns were raised as to the use to which she had put the money. The sister was ultimately removed as deputy and replaced by an experienced solicitor.
The solicitor obtained an asset freezing injunction against the sister and launched proceedings against her, alleging breach of trust and breach of the fiduciary duties she owed to her brother. The solicitor subsequently obtained summary judgment against her for about £550,000, plus interest.
The judgment debt was secured by a charging order against a property that was held in the sister's sole name. On the basis of that order, and with a view to recovering the money for the brother's benefit, the solicitor's successor as deputy sought an order for the sale of the house.
In resisting the application, the sister asserted that her brother had agreed to settle his claim against her for £140,000. However, the High Court rejected that argument, finding that the brother could not, as a matter of law, have agreed to a binding settlement whilst under the jurisdiction of the CoP. The deputy had full authority to act on his behalf and any purported disposition or dealing with his property that he might have entered into would thus have been void.
The Court in any event found that, at the relevant time, the brother lacked the mental capacity required to enter into a binding settlement with his sister. Even were that not the case, there was no evidence that such an agreement had in fact been reached. The Court made an order for the sale of the sister's property.