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Investment Protocol - Court Funds Office

Introduction

1.   Funds invested in court on behalf of minors and patients are subject to the protective and supervisory jurisdiction of the Court pursuant to Part VII of the Judicature (Northern Ireland) Act 1978. This protective jurisdiction is discharged by the Judicial Officers of the Court and by the Accountant General of the Court of Judicature and by the officers of the Court Funds Office (CFO) which manages investments on behalf of the Court.

2.   This protocol provides for an investment process which:

  • supports effective communication with the judiciary, clients and their representatives, and investment managers;
  • is supported by an appropriate level of experience and expertise; and
  • is governed by clear lines of responsibility and accountability.

(i)   Assessment of clients’ needs

3.   The underlying principle is to provide all clients with an investment service appropriate to their needs. When the CFO receives funds for a new case, all investment options are considered.  Where appropriate, the client and their representatives will be contacted to clarify the client’s needs and spending requirements. This will enable the investment manager to set appropriate investment objectives.  In some instances, generally low value cases or funds held in court for a short period of time, holding cash deposits is considered to be the only viable option, so the client and their representatives will not be asked to provide detailed information.  In all cases there will be an opportunity for the client and his representatives to meet with a member of CFO.

4.   When a client’s needs have been confirmed, the CFO stockbroker will be asked to provide advice on the most appropriate form of investment taking account of the client’s needs and the value of the available funds.

5.   The client and his representative will be informed of the investments that have been made. Where a client objects to an investment, they may apply to the Court to have the investment reconsidered.

(ii)   Investment decisions

6.   The court will have regard to the stockbroker’s recommendations, and any views expressed by the client and his representatives, and will make an order directing the investment of the funds by the Accountant General. 

7.   Funds invested in court will initially be held on deposit with the Debt Management Office (DMO) and will attract a statutory rate of interest. Thereafter a proportion of the fund may be invested in equities, gilts or other products having regard to the interests of the clients. All investment decisions will be subject to the overarching principle that the Court and its officers will at all times undertake a protective and supervisory role on behalf of clients.

(iii)   Regular review of investments

8.   The CFO stockbroker will keep all cases under regular review in order to identify in a timely manner the need for adjustments to investments in response to market fluctuations. In addition, CFO staff will maintain periodic contact with clients and their representatives to obtain updates on clients’ circumstances.

9.   Where adjustments to investments are recommended as a result of changed circumstances identified during the review process, the client and his representatives will be informed of the changes that have been made. Where a client objects to the change, they may apply to the Court to have the investment reconsidered.

10.   A statement of account detailing the current value of investments will be issued to clients and their representatives regularly. Clients whose investments include equities will receive a statement of account every six months. Clients whose funds are held in cash or gilts will receive a statement of account annually. A client and their representatives may, in addition, request a statement of account at any time.

(iv)   Performance management of investment objectives

11.   The CFO stockbroker will prepare regular performance reports on the achievement of investment objectives. This report will be circulated to the members of the Court Funds Judicial Liaison Group.

(v)   Professional training and delegation levels for CFO staff

12.   All relevant CFO staff will be trained and accredited through the professional development programme of the Securities and Investment Institute.

(vi)   Investment of funds out of court

13.   From time to time, an application will come before the court for a direction that funds are to be invested out of court.  While court funds legislation does not prevent the court from making such a direction, the court’s objective in relation to all matters relating to minors’ and patients’ funds will be the protection of the vulnerable, and the intention of court funds legislation reflects this protective role. Where such an application is made, therefore, the court will wish to be satisfied that the proposed investment out of court is preferable.