Nottinghamshire County Council v (1) Emma Kate Bottomley (By Her Litigation Friend Helen Ryan) (2) East Midlands Strategic Health Authority [2010] EWCA Civ 756

In this case the Court of Appeal was asked to review the decision by the High Court to refuse an application by the local authority (NCC) to be joined as a party to in respect of a hearing to assess damages owed by the defendant SHA to Ms Bottomley (EB).

In December 1993 EB had suffered hypoxic ischaemia during her birth resulting in brain damage and associated spastic quadriplegia. The SHA had admitted liability on the basis that they should have carried out a caesarean section earlier. EB is in the care of the local authority and, during the course of the proceedings, Helen Ryan (the Director of NCC’s social care and health) was appointed litigation friend as her mother had not been providing instructions. Shortly before the damages trial NCC applied to be added as a party as they wished to be heard on the matter as to whether EB should be awarded damages by way of lump sum or periodic payments, because the type of award affected whether EB would be charged for local authority social care provision after she reached the age of 18. If EB was awarded damages by way of periodical payments NCC would be able to take these into account when determining whether to charge, but (with the exception of income from investments) would have to disregard any lump sum awards under the Charging for Residential Accommodation Guidance. Those acting for EB opposed the application on the basis that it was unnecessary as the issues they wished to raise could be dealt with by the officers giving evidence on EB’s behalf and the late joining of the local authority would result in a delay. The SHA remained neutral on the point.
The judge, mindful that joining NCC at such a late stage would require a vacation of the hearing date, refused the application. He pointed out that EB’s litigation friend would likely have a conflict of interest that would need to be addressed, in that an application to the Official Solicitor would have to be made for a new litigation friend to be appointed. He accepted the argument of those acting for EB that NCC had no arguable status for affecting the way in which an award should be made as they sought to do so only for their own financial purpose. It was not therefore a circumstance that was required to be taken into consideration under CPR 41.7.
The Court of Appeal, though commending Ms Ryan for her integrity, and NCC for the fairness they had shown in the proceeding, confirmed that there was a conflict of interest which prohibited Ms Ryan from continuing to act as litigation friend. The conflict arose, nothwithstanding assurances from both her and NCC that she would only act in the best interests of EB, because EB’s legal team had made clear that, in order for her to demonstrate she was acting in EB’s best interests, they expected her to follow their advice and the Court of Appeal believed a “litigation friend must be able to exercise some independent judgment on the advice she receives from those acting for a claimant, and it was explicit in [EB’s legal team’s] submissions that she would be expected to accept all the advice she is given.”  The Court of Appeal also did not believe that it was fair to expect Ms Ryan to have to chose a method of damages less favourable to NCC if all other factors were balanced, but more fundamental, was the “principle that justice must be seen to be done” and that this required that a litigation friend must not be seen as having any such conflict of interests. For this reason alone, the Court confirmed that the hearing date would have to be vacated.
On the issue of whether NCC should be added as a party, the Court of Appeal confirmed that their powers under CPR r.19.2 were to be interpreted broadly. Whilst they had discretion to refuse any unmeritorious applications to intervene the fact that there had been no agreement as to the award, or method of payment, meant that there was still an issue to be decided by the Court; NCC was entitled to be heard on the issue and adding NCC as a party was desirable so that the court could resolve that issue, since for that purpose it was necessary to establish where B would be cared for, and whether and in what circumstances the local authority would propose to charge for its services and expenditure. Given the complex nature of a local authority’s liabilities and rights to recover charges for social care provision, the Court of Appeal was of the opinion that adding NCC as a party would assist the Court in determining how to award the damages.
Overturning the decision of the earlier judge, the Court of Appeal confirmed that the requirement (under CPR r.41.7) that a Court give consideration to “all the circumstances of the case” including the effect of the decision as to the form of award on a local authority “which may bear wholly or in part immediately or in the future the costs of caring for the claimant.”  The Court of Appeal also held that the judge had erred in deciding that NCC’s concerns as to its financial liabilities were irrelevant because such claims were necessarily concerned with finance. The judgments in R v Liverpool HA (2002), Crofton v NHS Litigation Authority (2007)  and Peters v East Midlands SHA (2009) all demonstrate the importance of having the authority as a party to such proceedings. Finally the Court of Appeal commented that there would be no real prejudice to EB if the hearing was vacated and proceedings delayed as she would remain in the care of the local authority.
There is increasing support for the position that a local authority is entitled to seek to ensure that tortfeasors pay in full for the provision of adult social care rather than rely on the availability of statutory services to meet needs. This is in line with the decision by the Court of Peters v East Midlands SHA [2009]. What is interesting in this case is that it provides a precedent for local authorities to seek to be added as parties in their own right and to put forward a case based purely on their own financial interests rather than, as was the position put forwarded in Peters v East Midlands SHA, that financial independence from a local authority would be in the best interest of the individual.

In addition this case clearly conveys that it is not be possible for a local authority to seek to act as a litigation friend on behalf of an incapacitated person, even one for whom they are acting as corporate parent, if the outcome of the case will have financial implications for the authority.  As such local authorities must now ensure the Official Solicitor is involved at an early stage of such proceedings and that a suitable independent person is appointed. Local Authorities should also indicate as early as possible within such proceedings whether they will wish to be added as parties so that delay can be avoided.

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