what is a bond?
A ‘bail bond’ (also known as a ‘bail bond’) is insurance that every professional or non-professional ‘lay’ deputy is required to purchase by the court. the bond protects the assets of the person (“p”) whose financial affairs and assets the deputy manages. does not protect the deputy from claims of negligence, carelessness, or mismanagement of p’s property or finances.
The bond is held between the bail provider and the deputy, but the bail payment will be taken from the assets of p. only the court can decide the value of the bond, based on the value of the assets of p. The court can change the value of the bond at any time if there is a change in the value of the assets of p. The court may also change the value of the bond if the perceived risk to p’s assets changes, for example, if an application is made to increase the deputy’s access to p’s property or finances. Once made, only the court has the ability to cancel or modify the bail, ensuring that the bail provider protects the vulnerable person from the actions of his or her surrogate.
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The court issues an order if it finds that p’s estate has suffered some loss due to the deputy’s actions. there is no requirement to prove fraud and the loss may not even be quantifiable. if the loss is not quantifiable, or the full effect of the action is still unknown, the court will often order an interim payment claiming part of the bond pending quantification of the loss. the bond provider must pay at sight without further investigation; however, they are entitled to recover the amount paid, plus expenses, from the deputy.
what is ‘schema’?
the og makes arrangements to facilitate the provision of bonds. this arrangement is called the “scheme” and effectively supports a provider of bonuses for court-appointed deputies. As of October 1, 2016, the plan is administered by Howden UK Ltd. The quality of service of the approved bond provider is monitored by the OPG ensuring profitable and reliable services. however, the deputies are not required to enter into an agreement on the scheme and have a choice as long as the opg has confirmed it.
If you have an existing bond with a provider previously endorsed by the OPG, such as Bond Bond Services (DBs), you do not have to transfer your bonds to Howden UK Ltd. these providers will continue to honor and manage all bonds.
You cannot become a professional or lay MP without having a bond in place. This ensures that any loss in p’s equity can be quickly replaced. however, the risk of incurring fines and bond provider fees may be higher for lay MPs who do not have previous MP experience.
Therefore, professional deputies are a common choice for those who do not want to be responsible for p’s property or finances or when the sums of money are substantial, such as when there is personal injury compensation.
professional deputies are usually lawyers who must also have professional indemnity insurance. consequently, bond providers recognize that an attorney with indemnity insurance will be able to pay in full and on time because any monies owed may be paid by indemnity insurance. This means bond providers will often offer reduced premium rates, saving you money and ensuring your assets are fully protected.
the telegraph wrote that since 2013 there has been a 153% increase in lay MPs and lawyers being removed from office due to financial mismanagement or alleged theft. There has also been a sharp increase in investigations, with 885 investigations in 2015. An OPG spokesperson claims this increase was due to “better investigations”.
An extreme example of financial mismanagement was when a deputy used his wife’s money to buy gifts and vacations abroad for himself and his mistress. however, the most common examples of deputy mismanagement of funds could involve selling a property to a family member at less than market rate or using the money in a way that is not in the best interest of p. it is the deputy’s duty to act in p’s best interest, not as p personally could or would have done, if he had the ability to manage his assets and financial affairs. re buckley clarified this point when a layman deputy bought a reptile house using a substantial proportion of the assets of p. the opg considered this financial mismanagement as not in his best interest to have a substantial proportion of his assets invested in a reptile business, even though the deputy argued that his aunt would have approved of his buying this business because she loved to the animals. the deposit would have been required to repair the loss of the client.
Boyes Turner Protection Court’s team of specialists act as professional counsel and deputies for clients across the country. We work with a variety of clients, from the elderly to those with ongoing or settled clinical malpractice claims.