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Many farming families in NI have concerns about potentially having to sell land or other property to cover the cost of care home fees for an elderly family member.
A common worry is that a health and social care (HSC) trust will force a sale to cover fees for the previous owner of a property, even years after it was transferred to another family member.
However, according to Peter Brown from the Agricultural Law Association, there are a lot of myths surrounding what is involved when someone goes into a care home in NI.
“There seems be a perception out there that if a property has been signed over for seven years then the trust can’t touch it. The difficulty is that the seven-year rule doesn’t apply to care, it comes from things like bankruptcy and marital breakdowns,” he said.
Speaking to the Irish Farmers Journal in his office at Martin, King, French & Ingram Solicitors in Limavady, Brown outlined the rules that HSC trusts use for assessing care home fees.
“The rules state that it would be unreasonable to decide that a resident had disposed of an asset in order to reduce his charge for accommodation if the disposal took place at a time when he was fit and healthy, and could not have foreseen the need for a move to residential accommodation. It’s more about why than when. There needs to be a motive other than avoiding care home fees to carry out a transfer,” he said.
Brown points out that there is no one-size-fits-all solution to the issue, and he encourages families to seek professional advice to explore all the options.
Fees
When deciding how care home fees are to be paid, an assessment of a resident’s financial affairs is carried out by the relevant HSC trust for the area, regardless if the care home is owned by the HSC trust (government) or by a private company.
“They [the HSC trust] will decide whether the person will be paying for it themselves, or the trust will pay for it, or a bit of both,” Brown said.
Assessments are based on a resident’s income, such as pensions and interest on savings, as well as their capital in the form of savings, investments and property.
Guidelines state that a resident with over £23,250 in capital pays for all their care fees, between £14,250 and £23,250 their capital partially funds fees, and if a resident has below £14,250 then their capital is ignored when calculating how much they pay.
With more than 20 years’ experience of practicing law in NI, Peter Brown’s key piece of advice is that every farmer should have a will, regardless of their age or family circumstances.
“A significant proportion of my most-problematic files have been farmers who didn’t make wills, or didn’t make wills until the last minute, leading to complications in relation to their estates,” he said.
Brown described making a will as a “rolling process”, which should be kept under review and can be amended as circumstances change.
He points out that farming is a dangerous occupation and has a higher workplace fatality rate than any other profession. Also, legislation which sets out who inherits an asset if a will is not in place can often mean that an asset with significant value, such as a farm, is not just left to the previous owner’s spouse, but their children get a share too. Difficulties can arise if children who are under 18 years old become joint owners.
“If your farm is in crisis because you have died unexpectedly, the last thing you want is for your family to have to run backwards and forwards to the courts to get orders on behalf of your children who are too young to be able to make those decisions themselves,” Brown said.
EPA
He also maintained that both farmers and non-farmers should set up an enduring power of attorney (EPA). This nominates someone to look after your financial affairs if you become incapable.
EPA is a straightforward document which allows the courts to give the nominated person a significant amount of flexibility. In cases where a person loses the ability to make decisions and has not set up an EPA, all decisions must be authorised by individual court orders.
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