Freeman v Lockett [2006] EWHC 102 (QB)

The Claimant (F) was involved in a road traffic collision and was left tetraplegic and wheelchair dependent.  Her cognitive abilities were not affected by the collision.  The Defendant (L) admitted liability in negligence and an agreed lump sum settlement was awarded to F for £5,546,245 subject to legal argument over what the court titled “the State funding issue.”  This was an argument put forward by L that the award to F should be adjusted to reflect that she was currently receiving and expected to receive in the future, a financial benefit from her local authority in the area in which she was resident. (Hertfordshire County Council).

Following the collision F received a direct payment of £969.54 per week. (£50,416.08 per annum.)  The court was invited by L to reduce the award by £1,000,000, submitting that F’s damages for negligence should only reflect her net consequential loss and expense and she should give credit in respect of any benefit received or likely to be received.  He also submitted that any failure by F to avail herself of such a benefit would amount to an unreasonable failure on her part, to mitigate her loss.  F submitted that she preferred not to be beholden to Hertfordshire for a substantial part of the money which she required in order to fund her care.

In its judgment, the court set out the statutory framework covering the type of care which F had been receiving and would be likely to receive in the future.  A local authority has a power under s.29 of the National Assistance Act 1948 to provide domiciliary care to persons “substantially and permanently handicapped …. by injury.”  This power was elevated to a statutory duty under s.2 of the Chronically Sick and Disabled Persons Act 1970 in relation to the provision of, amongst other things, practical assistance in the home.  F was eligible under Hertfordshire’s established criteria (in accordance with the “Fair Access to Care Services” criteria) to receive care services according to her assessed needs.  The power for local authorities to charge for domiciliary care is set out in s.17 Health and Social Services and Social Security Adjudications Act 1983, which gives a discretion for local authorities providing a service under s.29, to “recover such charge (if any) for it as they consider reasonable.”   Local authorities who do decide to charge are required in carrying out their assessments to act in accordance with any guidance issued by the Secretary of State, in this case “Fairer Charging Policies for Home Care and other non-residential Social Services”. It did not expressly deal with how unearned income should be treated when a local authority carries out its assessment.  The court also looked at the position on charging for residential care (under the local authority’s s.21 NAA function) which is that a capital asset such as a trust fund derived from personal injury damages should in some situations be disregarded in an assessment of means.  It was not clear whether this also applied to assessment of means in relation to the provision of domiciliary care services.  In Hertfordshire’s “Charging Policy Consultation” it was stated that if a service user had capital of more than £20,500, then he or she would be asked to pay for the full cost of care but if the cost of services was more than £310 per week, then no more than £310 would be requested.

The court held that although the current threshold was set at £310, there were no legal constraints preventing Hertfordshire raising or lowering it, having regard to its resources in the future.  Although a capital asset was to be disregarded under the guidance, in a means test for the provision of domiciliary care, it was by no means clear that income derived from that asset should also be disregarded.  The judge commented that the future availability and level of services was a matter which the court was completely unable to evaluate, and had “no confidence that the duty imposed by ministerial direction will exist at the time relevant to this claimant’s needs …. ministerial direction can be changed or withdrawn at any time without recourse to Parliament.” Godbold v Mahmood [2005] applied.  The judge also   cited a report in the Times (12/1/06) which suggested that many local authorities were considering raising charges for domiciliary care services in the near future.  He was therefore not minded to accept the Defendant’s request to reduce F’s damages.  There was no justification for additionally and unnecessarily imposing of the Claimant a risk which related not to the possible deterioration of her own condition or other matters wholly outside any normal control but rather the availability or source of funds to meet her needs.  It was entirely reasonable for F to decline to place reliance on State funding for any part of her care, and it was unnecessary for her to make such an undertaking to the court.  She would then have “unfettered flexibility” to chose where she lived, an opportunity that might be otherwise denied to her if the court were to make a deduction from her damages based on her continued residence in Hertfordshire.  It could not be appropriate to impose upon F the unnecessary risk that funding from an alternative source may cease or be reduced rather than simply to order the provision of the damages in their entirety.

Judgment was awarded for F in the sum £5,546,245.

Comment: this case shows just how important it is that charging for social care is discretionary and subject to guidance only if the care is non-residential, whereas it is mandatory, but non-chargeable for personal injury victims whose damages are put into a PI trust or managed by the Court of Protection, if the care is residential. Ensuring that a fit proper and astute Receiver is appointed for those whose capacity is seriously impaired by the tort, from the outset of a claim, who will assert the claimant’s right if at all possible to remain independent of the state’s provision of care in a care home, if only they can be given an interim payment, is a crucial piece of joint working that local authorities should be doing with PI solicitors acting for claimants, so that the damages burden falls where it was intended to – on the insurer – rather than on the LA.

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