Ryan v Liverpool Health Authority (Daily Telegraph, 2 October 2001) (QBD)

Residential care – capital to be disregarded – s21 NAA – court of protection – income – personal injury

R had settled proceedings against the Health Authority for personal injuries suffered during childbirth in the sum of £1million to be administered on his behalf by the Court of Protection. R’s injuries had left him permanently in need of care in a residential home setting, the cost of which had been met in full by the local authority, pursuant to s21 National Assistance Act 1948.

The council was subsequently joined as second claimant to the proceedings for the purpose of seeking a declaration that, when assessing R’s future liability to contribute towards the cost of his residential care, it was entitled to take into account any income R would receive from the capital sum of damages awarded to him.

That liability turned on the correct interpretation of the National Assistance (Assessment of Resources) Regulations 1992 (‘the assessment Regulations’), the relevant provisions of which cross-referred to the Income Support (General) Regulations 1987 (‘the income Regulations’).

It was common ground that the fund awarded to R fell within both paras.10 and 19 of Sch.4 to the assessment Regulations, under both of which the capital of the fund was to be disregarded for the purposes of assessing R’s means. However, in relation to income from capital, only income from a fund “administered by the court” under Sch.4 para.19 would be disregarded, whereas income from a fund “derived from a payment made in consequence of personal injury” under para.10 was not, applying the provisions of Sch.10 para.12 to the income Regulations. The question for the court was whether R’s fund fell within para.10 or para.19 of Sch.4 to the assessment Regulations, because it met both definitions.

Refusing the application, the judge found that although the two provisions initially appeared to cover the same ground, there was an entirely rational policy behind them. Whilst the general class of personal injury claimants whose funds were, for whatever reason, held in trust were required to make their trust income available to meet the cost of their accommodation, those who were under a disability and whose funds were managed by the court were entitled to have their trust income wholly disregarded for that purpose. It followed that the income from R’s fund was not to be taken into account by the council.

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