This enables the Land Registry to update the title.

Transferring ownership of property is a significant decision that should, where possible, be made with legal advice and guidance to ensure the legal parameters of the deed have been explained to all parties.

Where there is doubt in regard to a person’s capacity to sign the Deed, a formal capacity assessment should be considered.

The capacity assessment used for a Deed of Transfer can be completed using:

Contract capacity

Underpinned by the Fehily v Atkinson 2016 case law:

• Recognising the issue: A person needs the mental capacity to recognise the issues that must be considered, to obtain, receive, understand and retain relevant information, and to weigh this information in the balance of reaching a decision.
• Capacity for Specific Issue: The question of whether a person lacks capacity is issue-specific and should be judged in relation to the particular decision or activity in question.
• Ability to Understand: The question is not whether the person actually understood the transaction; instead, it is whether the person had the ability to understand the transaction if the consequences had been fully explained.
• Getting Help with Understanding: Getting help to understand the transaction does not prevent the person from having the capacity to understand it.

General Property and Financial capacity assessment

Underpinned by the Mental Capacity Act 2005 (where there is an appointed LPA or EPA in place):

• Is the person able to understand the information relevant to the decision, and has this information been provided in a way that the person is most likely able to understand?
• Can the person retain the information for long enough to be able to make the decision?
• Can they use or weigh that information as part of the process of making the decision?
• Can they communicate their decision?

What if the individual lacks capacity to understand and sign the Deed of Transfer?

• Mental capacity: A person cannot sign the Deed if they lack capacity to do so. In these circumstances, an appointed Property and Financial Attorney (LPA) or an Enduring Power of Attorney (EPA) can sign on their behalf.
• Property and Financial Court-appointed Deputy: In the absence of an LPA/EPA, an appointed deputy can manage the property transfer.

Deed of Gift – Transferring a property deed for free

A Deed of Gift is used to transfer a property deed without monetary exchange. This legal document confirms the transfer of property ownership without any payment or exchange of money. It is a common process for estate planning, such as parents gifting homes to children.

This type of transfer is most commonly used when gifting property or land to family during your lifetime. As with a Deed of Transfer, the donor must have mental capacity to make the gift and may require a gifting mental capacity assessment to evidence capacity for the transaction being proposed.

The gift must also be evidenced to be given of their own free will and free from any undue influence. When gifting a property, the property must typically be free from debts such as mortgages.

A Deed of Gift is also used when wishing to add someone to the deeds, such as adding a partner or family member to your deeds.

What assessment is used for a Deed of Gift?

The assessment for a Deed of Gift is underpinned by the Re: Beaney 1978 test, which focuses on the following points:

Are they capable of understanding the deed when its general purpose is explained to them in full?

The donor should be supported to understand the matter in question and recognise that they can seek legal advice where necessary. They should also demonstrate an understanding of the gift and its potential impact on their estate.

Is the level of understanding required relative to the type of transaction?

It is important to ensure their understanding is relevant to the gift being proposed.

It is also important to note that the donor may not have a legal background and therefore, it is not expected that they understand the transaction as a lawyer.

However, they should be able to demonstrate their understanding as a layperson who recognises the gift and its consequences once given.

Undue influence

The assessor must be able to demonstrate that the donor has not been pressured into making the gift and is doing so of their own free will and without influence. To support this, the donor must be seen alone, without the recipient or those who might benefit from the gift.

Explanation of the gift

The donor should be able to explain their motivation for the gift and their relationship to the recipient, particularly where they are gifting property to family, friends or a charity.

Other considerations of the gift are:

Deprivation of assets

Gifts of any kind can be viewed as a deprivation of assets, particularly where the donor is currently in receipt of care or likely to require care in the very near future. If proven, the property gifted may still be taken into account by the Local Authority.

Inheritance Tax (7-year rule)

Inheritance Tax may have to be paid after your death on some gifts you’ve given. Gifts given less than seven years before you die may be taxed depending on who you give the gift to, their relationship to you, the value of the gift, and when the gift was given.

Gift with Reservation of Benefit

If the donor continues to reside in the property without paying full market rent to the new owner, the tax benefits of the gift may be invalidated.

Non-revocable

Once a Deed of Gift is given, it cannot be taken back.

Gifting property into Trust using a TR1 form

When transferring property into Trust, a TR1 form is also used to transfer the title deeds into the names of the appointed Trustees. Accompanied by, for example, a Declaration of Trust to update ownership with HM Land Registry.

In these instances, where there might be doubt regarding the donor’s capacity, a gifting capacity assessment would be necessary to ensure the TR1 form is legally binding.

Deed of Transfer and Deed of Gift capacity assessments at Thornton & Lee

At Thornton & Lee, we recognise the importance of getting things right the first time, particularly in often time-pressured situations such as finalising a property sale or transfer.

Our assessors are highly experienced in completing the capacity assessments explored in this article and understand the evidence required to ensure a robust, evidence-based report is provided for your legal representative or HM Land Registry.

We ensure the assessment process is seamless, supportive and enjoyable to maximise your understanding and engagement.

In the unfortunate event that the donor lacks the necessary capacity to complete the Deed of Transfer, we ensure all assessments are of a Court standard with the necessary evidence to enable the appointed Property and Financial Attorney, EPA or Court-appointed Deputy to proceed with a Deed of Transfer on the donor’s behalf.

Contact our friendly and knowledgeable team today to discuss how we can support you through the assessment process and assist you in moving forward.

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A gift is the transfer of money, property or possessions without expecting anything in return. For a gift to be valid under UK law, the following three conditions must be met:

• The gift is given freely and voluntarily by the donor 
• The delivery of the gift to the recipient
• The acceptance of the gift by the recipient

Gifts are given for a variety of reasons, including to express appreciation or simply in goodwill. They can also be given spontaneously as a gesture of generosity and care. Gifts can be anything of value, which can include money, property or possessions. Most commonly, gifts are given on celebratory occasions such as weddings, birthdays and religious holidays. 

When might a gift not be valid?

A gift can be invalid if given under the influence, where the donor may claim no recollection of the exchange. Gifts can be made in error or under the influence of another person. The conditions of the gift may also be questionable, as the donor may claim it was conditional rather than absolute. 

What can you give inheritance tax (IHT) free?

• You can give away up to £3,000 each tax year, which is not added to your estate’s value (the annual exemption). Any unused allowance is carried over to the following tax year. 
• You can make small gifts of up to £250 per person.
• Larger gifts can also be exempt from Inheritance Tax when the donor lives for seven years after making the gift. 
• You can give up to £5,000 to your child when they marry (when made before the wedding).
• You can give up to £1,000 to a relative or friend when they marry.
• You can give up to £2,500 to a grandchild or great-grandchild when they marry.
• You can gift a family member to help with living costs (restrictions apply)
• You can make unlimited gifts from surplus income to your spouse or civil partner (record keeping is recommended). 
• You can gift to charities (which are always exempt from IHT regardless of value).  

How is the capacity to gift assessed?

You may have been advised by your solicitor to undertake an assessment of your capacity to gift to strengthen the validity of the proposed gift, or if there may be a question around your capacity to make the gift in question. Alternatively, you may simply wish to have a formal record of your understanding of the gift, should this be required in the future, for example, if there is a potential for conflict over the gift. 

• For smaller, general gifts, the test Re Beaney (1978) is used.
• For larger, more substantial gift,s the test Banks vs Goodfellow (1870) is used. 

When assessing capacity to gift, the donor is seen alone without the intended recipient present to ensure they can speak freely and without influence. Their understanding of the gift, their motivation behind it and their understanding of any wider implications on their current estate, daily expenses and consideration for any current or future care needs are all explored as part of this assessment process to ensure a clear, robust and accurate assessment of the donor’s decision-making capacity in relation to the gift. Our mental capacity assessors are trained in the evidence gathering required to ensure a Court standard assessment is achieved. Importantly, the individual being assessed feels supported and comfortable expressing their views, wishes and motivation for the gift. 

Importantly, that in line with the very definition of a gift, the understanding that once given, the act is final and cannot be reversed. 

It is important to note that a diagnosis of cognitive impairment does not imply a lack of capacity regarding the gift in question. Our assessors are highly trained, qualified and experienced in a wide range of communication approaches and methods and will work closely with you to ensure the content is accessible and presented in a manner that best suits you. 

Gifting, Court of Protection, Attorneys, Enduring Power of Attorney and Court-appointed Property and Financial Deputies

An application to the Court of Protection may be required when making a gift on behalf of the person whose financial affairs you legally manage. For gifting applications to the Court of Protection, the legal framework is the Mental Capacity Act 2005. Gifts are often a way of supporting the person to show appreciation to family members, friends or those who support them. However, there are strict rules when gifting on someone’s behalf as the Mental Capacity Act only allows you to gift in certain circumstances (Section 12 of the Mental Capacity Act 2005). Due consideration must be given to whether the donor has the mental capacity to make the gift and whether they can participate in the decision-making process. Importantly, it needs to be evidenced that the proposed gift is in the donor’s best interest. Even when someone is assessed as lacking the necessary capacity to make a gift, their views and wishes as it relates to the gift should be sought. 

There are some payments which fall outside of section 12, which only the Court of Protection can consider:

• Making a loan from the person’s funds
• Making a large gift
• Creating a trust of the person’s property
• Living rent-free in a property owned by the person
• Selling a property for less than its value or transferring it into someone else’s name
• Changing the Will of someone who’s died by using a deed of variation to redirect or redistribute the person’s share in the estate
• Maintaining someone other than the person, such as paying for school fees 
• Removal of cash assets, which reduces the size of the person’s estate

(GOV.UK)

Whether an LPA, EPA or deputy, those responsible will need to consider several factors when determining whether to gift on behalf of the person. These include their financial situation and the potential impact on their estate at the time of the gift. They should also consider any future implications, such as future and present needs, including formal care (deprivation of assets) and support.

The intended gift should not affect their daily spending and overall income. Furthermore, any instructions or wishes contained within an LPA should be carefully considered. Importantly, the decision would need to be carefully considered to ensure it is in the person’s best interest to make the proposed gift. Would the person have wished to make this gift if they had the capacity to do so, or did they perhaps have a history of making similar gifts prior to losing capacity?

The person may have previously expressed wishes regarding gifting, which would also need to be considered. Any gift proposed should also take into account the relationship between the donor and the proposed recipient and whether it might impact upon their existing Will and intended beneficiaries. The implications of inheritance tax and the person’s life expectancy should also be considered, and we recommend seeking legal advice to support your navigation of the proposed gift and legal implications. 

Our mental capacity assessors are highly experienced in applications to the Court of Protection, including gifting capacity assessments and other matters requiring Court approval. To find out how we can support your gifting enquiry, please contact our friendly and experienced team today by phone or by completing one of our contact forms which can be found here and we will be in touch promptly to discuss your needs. 

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COP3 is a specialist assessment of capacity form used by the Court of Protection. Used to establish if a person has the mental capacity to make a specific decision. The Court of Protection only makes decisions in the best interests of those who have been assessed as lacking the mental capacity to make that decision for themselves. Form COP3 has two parts; Part A and Part B. Part A is completed by the person making the application to the Court of Protection, and Part B is completed by the specialist Mental Capacity Assessor.

What types of decision-specific mental capacity assessments are recorded on a COP3 form?

The most common mental capacity assessment that Thornton & Lee complete on a COP3 form is in support of applications to the Court of Protection to become a Property and financial affairs Deputy. However, we also complete many COP3 form assessments for applications for a Personal Welfare Deputy, for a Statutory Will, for a Gifting application, and to remove a Trustee from a Trust. All of our Mental Capacity Assessors are skilled and experienced in completing all types of mental capacity assessments for a COP3 form.

Do I need a Solicitor to make an application to the Court of Protection?

Whilst we always suggest that members of the public have an experienced legal professional to guide them through the application to the Court of Protection, members of the public can also make applications to the Court of Protection directly and the forms are downloadable on the Government website for everybody. The merit of using a legal professional is that it avoids long delays and additional fees should the Court of Protection reject your application due to your forms being completed incorrectly. However, we do regularly complete COP3 forms for members of the public who have chosen to complete the application paperwork themselves and are very happy to accept referrals directly from members of the public. Thornton & Lee’s role and remit is strictly to complete mental capacity assessments. Consequently, should you choose to make an application to the Court of Protection directly without an experienced legal advisor, the correct completion of the application forms is your responsibility. 

Who can complete a COP3

Official guidance for COP3 form completion lists appropriate professionals as medical practitioners or social care professionals as certified to complete COP3 forms. In practice, however, it can be frustrating and time-consuming trying to track down a professional experienced in mental capacity assessments who is able and willing to complete the form. NHS professionals are often reluctant or slow to respond due to work pressures, and Local Authorities do not have any statutory responsibility to complete these forms. At Thornton & Lee our Independent Social Workers offer a quick, professional and efficient solution to the stress of trying to source a professional willing to complete a COP3 mental capacity assessment. 

A new COP3 form was launched in July 2023, can I still use the old form

Please note that Senior Judge Hilder has confirmed to the Court of Protection Property and Affairs User Group that the 6-month window for using the old COP3 form has now expired, and any COP3 assessments submitted on old the old COP3 form (pre-July 2023) will be rejected unless they have “explicit confirmation that circumstances have not changed”.

Social Services already did a mental capacity assessment. Can’t I submit that to the Court of Protection?

Unfortunately, not. If you submit a mental capacity assessment even if it is for the same decision, for example, property and financial affairs, without it being formatted specifically on a form COP3, the Court of Protection will not accept the application. 

What legal framework is used to complete a form COP3 

The legal framework underpinning mental capacity assessments on a COP3 is the Mental Capacity Act (2005). The Mental Capacity Act provides a legal framework for acting and making decisions on behalf of adults who lack the mental capacity to make particular decisions for themselves. A key principle of the Mental Capacity Act is that mental capacity is presumed and the emphasis is upon the Mental Capacity Assessor to then establish evidence that the person being assessed lacks mental capacity for the decision in question. In order to make a decision under the Mental Capacity Act the person being assessed is required to understand, retain, weigh and communicate the relevant information for the decision in question. 

Why do I need to tell you so much information about their circumstances if I believe they don’t have capacity? 

The Court of Protection is clear that all persons being assessed must be supported to understand the relevant information for the capacity assessment. For example a property and financial assessment must include support explaining a basic level of the relevant information to the person being assessed such as the address of the property they own, where they bank, and income and expenditure, and also asking them who would like to support them with their affairs, and how, to be able to then assess if that person can retain and use the relevant information to arrive at their decision. 

Why do you have to ask them questions when I already know they don’t have capacity? 

We understand that this might be confusing or upsetting for family members that the appointment includes asking the person being assessed questions they are unable to answer. The Mental Capacity Act Code of Practice is clear that the person undertaking the assessment must do all that they can to explain the information relevant to the decision to the person being assessed, and the Court of Protection will not accept a mental capacity assessment on form COP3 which does not evidence how the relevant information has been explained to the person in an accessible manner, and evidence that following this explanation the person being assessed has been unable to understand, use or weigh the information. 

What does cognitive optimum mean

At Thornton & Lee we triage all referrals very carefully to ensure each person is assessed at their cognitive optimum, which essentially means that the appointment took place when they were at their best in terms of their memory and understanding. For example, a person with Alzheimer’s might be quite bright in the mornings but become increasingly confused by the end of the day. Hence the appointment would be booked in the morning. Some types of acute illness or infection can impact understanding and memory too, such as a urine infection, so the appointment would be booked once this has been resolved. The Mental Capacity Assessor will also in addition to the timing of the assessment consider the location, involvement of trusted others, and communication method to make sure that as far as possible the person is relaxed, comfortable and the communication approach gives them maximum scope to both understand but also express any wishes or views they might have during the appointment. 

Can a COP3 assessment be completed by video? 

In principle yes, mental capacity assessments can be completed by video, and the Court of Protection does accept COP3 assessments undertaken virtually. At Thornton & Lee we undertake many assessments virtually each week with the COP3 form also explicitly requesting information as to whether the assessment was completed virtually or face to face and why. The essential aspect to consider when weighing whether the assessment should take place face-to-face or virtually is the impact on the person being assessed. The Mental Capacity Act Code of Practice is clear that the Assessor must take all practicable steps to ensure that the person being assessed is supported to understand and engage with the assessment and so ultimately video assessments can be utilised for those where it is evident that they will not be disadvantaged from understanding, using and weighing the relevant information for that decision by the assessment taking place virtually over face to face.

What do you do if they can’t communicate verbally?

At Thornton & Lee all of our Mental Capacity Assessors are trained in completing mental capacity assessments for those who are non-verbal. We have a vast library of resources and also experience in using a variety of different communication methods. So you can be reassured that the person being assessed is given the maximum opportunity to engage in a meaningful way and the right platform to be able to communicate any wishes or views that they have non-verbally. 

Is it possible for the person to later regain capacity?

The COP3 form dedicates a section to this question, and in principle yes absolutely it’s possible in a small number of cases. For example, a younger adult with a learning disability, who has always had support from a parent or carer, might not yet have had the opportunity to develop and ‘acquire’ understanding and ability to use the information to make a capacious decision. With the right level of support and focus on independent living skills or financial management over time, they could go on in the future to have mental capacity. Another example might be an adult who has experienced an acquired brain injury and lost many of the skills and understanding over a particular decision. With the right focus on rehabilitation and practising skills over time, it might be possible for an adult with an acquired brain injury to ‘regain’ mental capacity in the future. 

Can a COP3 assessment be completed for a patient still in hospital? 

In principle yes, a mental capacity assessment can be completed when the person is still in hospital. Although we do generally find people do better in their own environment there are occasions when it is not possible to delay the mental capacity assessment and so it must take place in the hospital. However, the person being assessed must be at their ‘cognitive optimum’, and as such they must be free from any acute illness or infection that might impact on understanding and memory such as an infection, constipation, or unstable diabetes for example. If undertaking an assessment in a hospital it is also important that a quiet and distraction-free area is found to undertake the assessment to give the person the best opportunity to engage in a meaningful way with the appointment process.

How long will a COP3 assessment appointment take 

It depends on the individual. If they enjoy the ‘chat’ with our Mental Capacity Assessor, as is often the case, then the appointment can take anything from 45 minutes to 2 hours. However, if the person is very poorly and is struggling to engage with the assessor despite the supportive and kind approach then the assessment will be streamlined to gather the relevant information as promptly and efficiently as possible.

How much is a COP3 assessment 

At Thornton & Lee our video COP3 assessments have a fixed fee of £375.00. However, we know that the virtual world is not suitable or preferred by everyone and so if a face-to-face appointment is necessary or deemed to be the most appropriate method of assessment for a COP3 form for that person, we have assessors based throughout England and Wales and can offer a quote for travel.

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