High Court quashes refusal by council to fund care needs of disabled adult

In CGT, R (On the Application Of) v West Sussex County Council [2026] EWHC 293 (Admin) (13 February 2026), His Honour Judge Auerbach, sitting as a judge of the High Court, allowed the judicial review challenge to a decision letter issued in June 2024, by which the council refused to fund the claimant’s care from 6 July 2024 and required repayment of £271,253.44 in respect of care costs paid between July 2020 and July 2024.

The judge said: “It is common ground, as I have noted, that the basic conditions of eligibility in s.18 of the 2014 Care Act were met in this case. It is also common ground that if, as I have found they should have been, the funds in the PI trust are wholly disregarded, the claimant had no other capital resource. I was also told that the claimant has been assessed as eligible for continuing healthcare funding by NHS Sussex Integrated Care Board with effect from 16 September 2025, but that, prior to that, following the defendant's decision of 7 June 2024, the PI trust made payments for the claimant's care in the sum of £66,979.15.”

The claimant was born in 1994. At the age of around three months, he suffered a brain injury resulting in a severe cognitive impairment, visual impairment, epilepsy, and other life-long difficulties.

He has lived in supported accommodation since 2013. The claimant lacks capacity to make his own financial decisions. His mother, (RGT), was appointed as his property and financial affairs (PFA) Deputy by the Court of Protection in 2011.

In November 2012, the Criminal Injuries Compensation Authority (CICA) made an award of more than £3.5 million, on condition that it be paid into a discretionary trust of which the claimant is the sole beneficiary and the Official Solicitor (OS) is the sole trustee (the PI trust).

The total award included more than £2.6 million in respect of future care costs.

The form of acceptance contained undertakings linked to any future application for public funding for care under section 21 of the National Assistance Act 1948.

However, following the death of the claimant’s mother in 2013, and the subsequent appointment of his father (SGT) as deputy in 2014, no restriction was included on SGT's ability to seek public funding for the claimant's care needs.

In December 2017, SGT's solicitors asked the defendant to carry out a care needs assessment for the claimant.

Following correspondence, they wrote again in August 2019 renewing that request and asking that the council make contributions towards the costs of the claimant's residential care placement.

In October 2019, the council wrote to the Office of the Public Guardian (OPG) challenging that request in view of the 2012 CICA undertakings.

The council wrote to SGT's solicitors maintaining that the claimant's care needs should be met from the PI trust, and indicating that it would be making an application to the COP for a restriction along the lines envisaged in the 2012 CICA undertakings.

However, the council proposed, in the meantime, to begin to meet the claimant's needs, from 6 July 2020, without prejudice to the outcome of that application.

It began to make payments from around that date, exercising discretionary powers, direct to the care home provider, and without carrying out any formal financial assessment.

In October 2023, the council applied to the COP seeking to have the terms of SGT's Deputyship varied, to introduce a condition in respect of any application for public funding of the claimant's care needs, along the lines envisaged in the 2012 CICA undertakings.

The COP dismissed that application.

In June 2024, the council wrote to SGT's solicitors in the following terms:

"Following the Local Authority's application to the [CoP] and guidance from the [OPG], I write to set out the Local Authority's position in respect of the funding of [CGT's] care needs. The Local Authority maintains that [CGT's] needs should be met from his trust fund, as envisaged when the CICA award was made.

“On 16 June 2020 the Local Authority wrote to you and explained that it would fund such care needs on a without prejudice basis. Such funding has been in provide since 6 July 2020. [CGT's] original trustee and Deputy gave an express undertaking that she would not apply for public funding to assist with [CGT's] care needs. Care cost compensation was included in the CICA award relying on that undertaking.

“Since 2012 both the relevant legislation dealing with social care costs has changed, from the National Assistance Act 1948 to Care Act 2014, and the identity of the Deputy has changed. Regardless of whether [CGT's] current Deputy is bound by the earlier undertakings and whether these undertakings would apply to replacement legislation, the effect of WSCC paying [CGT's] assessed care need costs is that there is double recovery.

“[CGT] was given a compensation package that included future care need costs. That fund has not been exhausted and, despite the undertaking given, [CGT's] Deputy has applied for local authority funding of assessed care costs. Where the Deputy has not repaid CICA there is double recovery.

“In this case both sources of funds have been from the public purse.

“In the case law, including Tinsley, the court has emphasised that it will prevent double recovery. Consequently, WSCC gives the Deputy notice that it will cease to pay [CGT's] assessed care need costs on 5 July 2024 with the expectation that these costs will thereafter (from 6 July) be paid from the trust fund.

“WSCC gives notice that it requires [CGT's] Deputy to repay care need costs paid between 6 July 2020 and 5 July 2024 totalling £271,253.44. With a view to a speedy resolution, WSCC is willing to forego interest on this sum. However if repayment is not made by 7 September 2024, a demand for interest will also be pursued."

Following pre-action correspondence, the proceedings were begun.

His Honour Judge Auerbach set out the grounds as follows:

• Ground 1: The defendant acted unlawfully because its decision was contrary to the express terms of para.15 of sch.2 of the  Care and Support (Charging and Assessment of Resources) Regulations 2014/2672, and to the Guidance.
• Ground 2: The defendant did not provide adequate or intelligible reasons for its decision.
• Ground 3: The defendant wrongly took into account the 2012 Criminal Injuries Compensation Authority (CICA) undertakings, despite them not being binding on the claimant's father (SGT), and despite the COP having refused the defendant's request to amend the terms of his appointment.
• Ground 4: The defendant has failed, as required by the 2014 Act, to carry out a needs assessment and provide a written record of it.

Setting out the statutory framework, the judge noted that where it appears that an adult resident has care needs, the local authority has a duty under section 9 of the 2014 Care Act to assess those needs.

If their needs meet the eligibility criteria pursuant to s.13, then s.18 requires the authority to fund them in full if the individual's resources are below the lower capital limit. Where it is considering making a charge, s.17 requires the local authority to carry out a financial assessment, and, having done so, to provide a written record to the adult to whom it relates.

The judge continued: “The Care and Support (Charging and Assessment of Resources) Regulations 2014/2672 were made in exercise of powers conferred by the 2014 Care Act. They make provision that the authority need not carry out an assessment, if the adult consents to it not doing so.

“Reg.18(2) provides that any capital, where applicable, specified in sch.2 is to be disregarded. Sch.2, headed "Capital to be disregarded", provides at paras 15 and 16:

"15 Any amount which would be disregarded under paragraph 12 of Schedule 10 to the Income Support Regulations (personal injury trusts)."

"16 Any amount which would be disregarded under paragraph 12A of Schedule 10 to the Income Support Regulations (personal injury payments) with the exception of any payment or any part of any payment that has been specifically identified by a court to deal with the cost of providing care."

The council contended that para.15 of sch.2 of the 2014 Regulations should be interpreted as requiring funds in a PI trust to be disregarded, when assessing capital resources, save in respect of the element of a payment provided for the purpose of funding care needs (judge’s emphasis).

The judge said: “Mr Paget [for the defendant] invoked the well-established modern approach to statutory construction, which is to have regard to the purpose of the provision in question and to interpret its language, so far as possible, in a way which gives best effect to that purpose. He submitted that the court should adopt an interpretation which will avoid producing an arbitrary or irrational result unless compelled by very clear wording to do so.”

Counsel for the defendant suggested that the fact that the wording of para.15 (which refers to reg.12 of the 1987 Regulations) was not qualified in the same way as that of para.16 (which refers to reg.12A of the 1987 Regulations) makes “no logical sense”.

He submitted there was no good reason not to carve out care awards from the disregard of PI trusts, just as they are carved out from the disregard of an ordinary PI award. The rationale should logically apply equally to both. He suggested that this might have been the result of “oversight” on the part of the legislator.

The judge said: “This general argument of statutory interpretation is in my judgment unsustainable. It is the very argument that was rejected in the Peters case (albeit there in relation to the provision concerning a fund administered by the COP). The language of the statute is unambiguous. It does not call, and leaves no room, for any act of interpretation.”

He continued: “In any event, it cannot be inferred that an obvious oversight or plain drafting error has occurred, particularly given that paras. 15 and 16 of the 2014 Regulations are adjacent, and para. 16 expressly excludes care funds from the disregard for which it provides, but para. 15 does not do so. This bespeaks that Parliament was expressly alive, and applied its mind, to the question of whether, or in which circumstances, funds relating to care needs should be treated differently; and it decided that payments into PI trusts should be treated differently from ordinary awards of PI damages in this respect.

“It is not obviously illogical or contrary to the statutory purpose that an award which sits within a trust should be treated differently in this regard.”

Rejecting the arguments based on statutory interpretation, the judge upheld grounds 1 and 3.

The judge said: “I conclude that the defendant did act unlawfully in refusing to entertain the claimant's application on the basis that it did, and in seeking, on the same basis, to recoup discretionary funds that had already been paid out. In light of that conclusion, I do not need to consider the "reasons" challenge advanced by ground 2.”

On ground 4, he concluded: “As to ground 4 the defendant wrongly failed to carry out a formal financial assessment as the duty to do so was engaged and the claimant had not consented to it not doing so. It cannot, as floated by Mr Paget in his skeleton argument, rely on s.31(2A) Senior Courts Act 1981 to contend that, had it undertaken an assessment it was "highly likely" that it would still have refused funding. That argument was premised on the scenario that it would still have taken that stance to avoid double recovery. That provision cannot be relied upon by reference to a counterfactual scenario in which the defendant would still have been acting unlawfully.”

Finally, turning to the issue of relief, the judge rejected the defendant's invitation to exercise his discretion to refuse relief.

He said: “I will grant a declaration that the decisions conveyed in the Decision Letter, both to cease funding, and to demand repayment of discretionary sums previously paid out, were unlawful, and I will quash those decisions.

“It is common ground, as I have noted, that the basic conditions of eligibility in s.18 of the 2014 Act were met in this case. It is also common ground that if, as I have found they should have been, the funds in the PI trust are wholly disregarded, the claimant had no other capital resource. I was also told that the claimant has been assessed as eligible for continuing healthcare funding by NHS Sussex Integrated Care Board with effect from 16 September 2025, but that, prior to that, following the defendant's decision of 7 June 2024, the PI trust made payments for the claimant's care in the sum of £66,979.15.

“Having been sent this judgment in draft under embargo terms, respective counsel agreed that I should also, in light of my decision, direct the defendant to pay that sum of £66,979.15 to the PI trust, subject to any deduction for contributions owed by the claimant pursuant to the Care and Support (Charging and Assessment of Resources) Regulations 2014; and I am indeed so directing.”

The parties agreed that the council should pay the claimant’s costs, subject to detailed assessment if not agreed. However, the court declined to order indemnity costs, finding that the council’s conduct did not meet the relevant threshold.

Lottie Winson