The investigation will also examine why a mental health trust failed to inform the police that it had no idea of the whereabouts of one of its mentally disturbed outpatients for almost four months.
Richard Phillips, 32, died from a heart attack after collapsing near his home in west London on 6 January. Six weeks later his body was cremated by Westminster City Council's environmental health department at an unattended ceremony. The ashes were scattered in the garden of the crematorium.
His family - which includes his mother, three daughters, a son, five brothers and a sister - and a large number of friends, all of whom live in London, learned of the death 47 days later. They are now demanding an explanation of why the combined powers of the council, the coroner's office, a mental health trust, the local health authority and the police could not trace the next-of-kin, despite the body being identified days after its discovery.
Mr Phillips's community psychiatric nurse informed her trust and the council's social services department that she could not locate him at the beginning of December. His mother also reported her son missing to the trust in December, and eventually to the police on 18 March.
Friends of the family claim that the failure to find Mr Phillips was because he was a black Rastafarian who was considered to be 'at the bottom end of the scale of interest'.
Mr Phillips was born in west London and was a well-known member of the black community in Notting Hill. He frequented the Mangrove community centre and helped as a steward in the Notting Hill carnival.
About four years ago he spent two years in jail for robbery. After his release he suffered a mental breakdown and received treatment at a psychiatric ward rented by the North West London Mental Health Trust in St Mary's Hospital, west London. He spent six months there after being diagnosed as a schizophrenic. Later, he was released into the community as an outpatient, and was housed in a one-bedroom flat in Paddington. A nurse visited regularly to give injections.
His body was found, without any identification, on the pavement less than 100 yards from his flat in Gloucester Terrace, Paddington. He was taken to St Mary's Hospital, where he was pronounced dead.
Westminster Coroner's Court was informed and his fingerprints were taken, which helped to identify him.
Police went to three addresses where Mr Phillips had previously lived but could not find any next of kin.
Jebb Johnson, director of the Mangrove community centre, who had been a friend of Mr Phillips for 16 years, said: 'No one seemed to go to any effort to try to contact the family or the local community - he was a black man, so his interest value is at the bottom end of the scale.'
Mr Phillips's community psychiatric nurse became concerned about her patient at the beginning of December, after she repeatedly called at his flat and found it empty. She contacted Westminster social services and the trust, which checked his empty flat but did not contact the police.
Peter Carter, director of operations at the trust, said: 'Just because someone does not keep their appointments, it does not mean that we should go to the police.'
The ultimate responsibility for tracing Mr Phillips lies with Westminster City Council.
A council spokesman said: 'This is a heart-rending case. It is our responsibility, but to what extent are we expected to go in tracing someone?'
An independent inquiry, whose findings will be made public, is to be set up by Westminster City Council, the North West London Mental Health Trust, and the Kensington, Chelsea and Westminster Health Commissioning Agency.
Mr Phillips's mother, Daphne Phillips, said: 'I collapsed when I heard he was dead. I couldn't believe they had cremated him.
'There's nothing left of him now - we never got a chance to say goodbye. His children didn't get to see their daddy off.'
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