Government loses Supreme Court case on determining ordinary residence of care user

The government is to study urgently a Supreme Court ruling which criticised its decision making and statutory guidance in relation to determining the ordinary residence of care users.

In its judgement in R (on the application of Cornwall Council) v Secretary of State for Health, handed down today, the court rejected the secretary of state for health’s determination of the ordinary residence of a disabled man – known as PH – who lacked capacity to decide where he lived.

The case considered which of three authorities – Wiltshire, Cornwall or South Gloucestershire – should be responsible for the £80,000 annual costs of PH’s care in a Somerset care home.

In ruling that PH was ordinarily resident in Wiltshire, the Supreme Court judged that the secretary of state had misapplied the law in determining that Cornwall was responsible for his care.

Care Act impact

The case was judged in line with the law set out in the National Assistance Act 1948. The law has been updated by the Care Act 2014 and ordinary residence determinations made after April 2015 are governed by the new law.

The Care Act guidance, published last October, stated that it would be updated following the judgement in this case, and the Department of Health is now examining the ruling to decide how it should respond.

A DH spokesperson said: “We are carefully considering the impact of the judgment of the Supreme Court.”

About this case

PH was born in 1986. In 1991 his parents, who were then living in Wiltshire, asked the council to accommodate him under section 20 of the Children Act 1989, and the council placed him with foster parents in South Gloucestershire.

Later in 1991, his parents moved to Cornwall but he remained with his foster family, though having regular contact with his parents, including occasional visits to the family home.

Under the terms of the Children Act 1989, Wiltshire remained responsible for his care as the authority that had made the placement. As PH was unable to stay with his foster parents after turning 18, Wiltshire placed him in a care home in Somerset in January 2005, after he turned 18, a decision his parents were involved in.

At that point, his care fell under the jurisdiction of the National Assistance Act. Though this first placement broke down he subsequently moved to another care home, also in Somerset, where he remains.

Wiltshire carried out an assessment of PH’s capacity in 2008, concluding that he lacked capacity to choose where he lived, and that this would also have applied in 2004, when the decision was made to place him in the care home.

History

As with the Children Act, the National Assistance Act stipulates that, where a person is placed out of area, they do not become ordinarily resident in the area of the placement but retain their previous ordinary residence status.

Though Wiltshire had placed PH in the Somerset care home, the issue of PH’s ordinary residence remained unresolved between Wiltshire, Cornwall and South Gloucestershire. In 2011, they jointly referred the dispute to the secretary of state who determined in 2012 that, as of the relevant date – 26 December, 2004, the day before PH’s 18th birthday – he was ordinarily resident in Cornwall.

Cornwall then launched a judicial review against the decision, but the High Court upheld the secretary of state’s determination. However, the Court of Appeal accepted Cornwall’s appeal in 2014, stating that South Gloucestershire was responsible for PH’s care.

The secretary of state, along with Somerset County Council, then appealed to the Supreme Court, with the support of South Gloucestershire and Wiltshire.

Legal issues

Two key issues considered in the case were:

1. How ordinary residence should be determined when someone transitions from the jurisdiction of the Children Act to the National Assistance Act.
2. How ordinary residence should be determined for a person who lacks capacity to decide where they live, where the usual “Shah”test – the place that a person has adopted voluntarily and for settled purposes – does not apply because a place is not adopted voluntarily. The Shah test is drawn from Lord Scarman’s judgement in Shah v London Borough of Barnet [1983].

The secretary of state’s decision

In making his 2012 decision, the secretary of state drew on the 2011 statutory guidance on ordinary residence. This stated that when someone transitions from the jurisdiction of the Children Act to the National Assistance Act, the stating presumption is that they remain ordinarily resident in the local authority that had responsibility for them under the Children Act, in this case Wiltshire.

However, this may be overturned by the facts of the case, and the secretary of state argued that this was so for PH.
The secretary of state said that, as of 2004, PH had no links with Wiltshire as his family had left there in 1991. At that time the family home in Cornwall was somewhere he returned for holidays, proximity to this was relevant to where he was placed and his parents were involved in making decisions about his care, so his “base” was with his parents.

While his visits to Cornwall were infrequent, the secretary of state said the decision needed to take into account “the entirety of the relationship between [PH] and his parents”.

The Vale “tests”

The secretary of state’s reasoning was based on a key judgement, R v Waltham Forest London Borough Council, ex Parte Vale [1985], which the 2011 guidance said should be used to determine ordinary residence where a person lacks capacity to decide residence.

The Vale case concerned a woman with severe learning disabilities who had been in residential care in Ireland where her parents lived, but then moved with her parents to a house in Waltham Forest in London. A few weeks later she was placed in residential care in Buckinghamshire and the case considered whether she was ordinarily resident in Waltham Forest.

The guidance stated that the Vale case generated two “tests” for determining ordinary residence where a person lacked capacity to decide residence:

• Where a person’s learning disabilities were so severe, as in the Vale case, that they were totally dependent on a parent or carer, their ordinary residence was that of their parents.
• In cases where the first test is not appropriate, for example when the parents were dead, a person’s ordinary residence should be determined as if they had capacity, looking at the person’s physical presence in an area and the purpose of that presence, in line with the Shah test, but without the person having to have adopted their residence voluntarily.

The secretary of state thus concluded that PH’s ordinary residence was that of his parents, placing responsibility with Cornwall.

“Misunderstanding”

However, Lord Carnwath, handing down the judgement, said the weight placed on the Vale tests, both in the 2011 statutory guidance and in the determination of ordinary residence in PH’s case, was “misplaced”.

He said the Vale judgement, rather than providing two separate legal tests for ordinary residence, was simply an application of the Shah test to people who lacked capacity to determine their residence. The key point was whether the person’s residence was sufficiently settled with their parents to constitute ordinary residence.

It was a “misunderstanding” of the Vale judgement for the secretary of state to decide that it was the nature of PH’s relationship with his parents and their home that was determinative of ordinary residence. This was “irreconcilable with the language of the [National Assistance Act], under which it is the residence of the subject, and the nature of that residence, which provide the essential criterion”.

Which authority?

So, by reference to the National Assistance Act, PH would retain the ordinary residence that he had prior to moving into the Somerset care home. By a majority of four to one, the Supreme Court rejected the Court of Appeal’s view that, on this score, South Gloucestershire was responsible for PH’s care.

While PH had lived happily with his foster parents in South Gloucestershire for 14 years, he had been placed there by Wiltshire, which had been responsible for his care up to the age of 18 under the Children Act. It would have created “an unnecessary and avoidable mismatch” to treat his placement in South Gloucestershire as determining his ordinary residence after he turned 18 and fell under the National Assistance Act, when it had not been his place of ordinary residence under the Children Act.

Lord Carnwath added: “It may seem hard to Wiltshire to have to retain indefinite responsibility for a person who left the area many years ago. But against these are the advantages for the subject in continuity of planning and financial responsibility.”

Disappointment and vindication

The judgement drew contrasting reactions from Wiltshire and Cornwall councils.

A Wiltshire council spokesperson said: “We are disappointed with this judgment as it reflects a change in how the law has been applied by the courts and the secretary of state until now. However, we do of course accept this judgment and, as with all other authorities, will consider any further implications it may have for the council.”

A Cornwall council spokesperson said: “We would wish to emphasise that throughout these proceedings our priority has been the care of the service user which has remained unaffected.  However, Cornwall has a duty to safeguard the limited resources available to provide care to vulnerable adults and the decision of the Supreme Court has vindicated the position of the council in bringing this challenge to the secretary of state for health’s decision.”