Care England, R (on the application of) v Essex County Council, Court of Appeal - Administrative Court, December 01, 2017, [2017] EWHC 3035 (Admin)

Resolution Date:December 01, 2017
Issuing Organization:Administrative Court
Actores:Care England, R (on the application of) v Essex County Council

Case No: CO/5359/2016

Neutral Citation Number: [2017] EWHC 3035 (Admin)




Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 01/12/2017


Mr Justice Lavender

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Mathew Purchase (instructed by David Collins Solicitors) for the Claimant

Andrew Sharland (instructed by Essex County Council) for the Defendant

Hearing dates: 7 November 2017

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JUDGMENTMr Justice Lavender:

(1) Introduction

  1. The Claimant, which is a charity and a representative body for care home operators, seeks judicial review of a decision taken by the Defendant council on 22 July 2016 (``the July 2016 decision'') to increase some of the fees which it pays to the operators of care homes. The Claimant was given permission to apply for judicial review on four grounds:

    (1) The Claimant contends that the Defendant was in breach of its duty under subsections 5(1) and (2) of the Care Act 2014 (``the Act'').

    (2) The Claimant contends that the Defendant failed to follow relevant guidance issued by the Government.

    (3) The Claimant alleges that the Defendant failed properly to consider whether the July 2016 decision complied with that duty and that guidance.

    (4) The Claimant alleges that the July 2016 decision was Wednesbury unreasonable.

  2. It was accepted that the third ground did not add anything to the first two. I say no more about it.

  3. On 11 October 2017, less than a month before the hearing, the Defendant applied for permission to adduce a three-paragraph witness statement and to amend its grounds of resistance. The witness statement merely served to inform the Court of a recent decision by the Defendant (``the October 2017 decision''), to which I will return. The amendments served to insert a paragraph referring to the October 2017 decision, and to insert submissions to the effect that I should not quash the July 2016 under challenge, even if I found that the Defendant had acted unlawfully, in particular because of the requirements of good administration and/or pursuant to section 31(2A) of the Senior Courts Act 1981.

  4. I did not rule on this application at the hearing, as I did not want the hearing to be distracted by a procedural issue. I heard submissions on these issues de bene esse, but on the understanding that the Claimant had not had an opportunity to challenge the October 2017 decision and that I should not assume that it was lawful. On that understanding, Mr Purchase was able to address the new issues raised, and on the same basis I grant permission for Defendant to make the amendments and to rely on the new witness statement.

    (2) Section 5 of the Care Act 2014

  5. Subsections 5(1) and (2) of the Act provide as follows:

    ``(1) A local authority must promote the efficient and effective operation of a market in services for meeting care and support needs with a view to ensuring that any person in its area wishing to access services in the market--

    (a) has a variety of providers to choose from who (taken together) provide a variety of services;

    (b) has a variety of high quality services to choose from;

    (c) has sufficient information to make an informed decision about how to meet the needs in question.

    (2) In performing that duty, a local authority must have regard to the following matters in particular--

    (a) the need to ensure that the authority has, and makes available, information about the providers of services for meeting care and support needs and the types of services they provide;

    (b) the need to ensure that it is aware of current and likely future demand for such services and to consider how providers might meet that demand;

    (c) the importance of enabling adults with needs for care and support, and carers with needs for support, who wish to do so to participate in work, education or training;

    (d) the importance of ensuring the sustainability of the market (in circumstances where it is operating effectively as well as in circumstances where it is not);

    (e) the importance of fostering continuous improvement in the quality of such services and the efficiency and effectiveness with which such services are provided and of encouraging innovation in their provision;

    (f) the importance of fostering a workforce whose members are able to ensure the delivery of high quality services (because, for example, they have relevant skills and appropriate working conditions).''

  6. The Claimant relied, inter alia, on the words ``the importance of ensuring the sustainability of the market'' in subsection 5(2)(d). I will refer to this as ``the sustainability factor''.

  7. The background to these provisions of the Act includes the following statement in paragraph 6.2 of ``Building Capacity and Partnership in Care: An Agreement between the statutory and the independent social care, health care and housing sectors'', which was published by the Department of Health in October 2001:

    ``Providers have become increasingly concerned that some commissioners have used their dominant position to drive down or hold down fees to a level that recognises neither the costs to providers nor the inevitable reduction in the quality of service provision that follows. This is short-sighted and may put individuals at risk. It is in conflict with the Government's Best Value policy. And it can destabilise the system, causing unplanned exits from the market. Fee setting must take into account the legitimate current and future costs faced by providers as well as the factors that affect those costs, and the potential for improved performance and more cost effective ways of working. ...''

  8. I note the refence in this passage to the Government's Best Value policy. It was acknowledged in the present case that councils such as the Defendant remain under an obligation to obtain value for money when commissioning placements in care homes.

    (3) The Guidance

  9. Subsection 78(1) of the Act provides as follows:

    ``A local authority must act under the general guidance of the Secretary of State in the exercise of functions given to it by this Part or by regulations under this Part.''

  10. The Secretary of State has issued guidance for the purposes of subsection 78(1), entitled ``Care and support statutory guidance'' (``the Guidance''). Chapter 4 of the Guidance is headed ``Market shaping and commissioning of adult care and support''. The introduction to chapter 4 states that it provides guidance on section 5 of the Act. It includes the following paragraphs:

    ``4.11 This statutory guidance describes, at a high level, the themes and issues that local authorities should have regard to when carrying out duties to shape their local markets and commission services. Market shaping, commissioning, procurement and contracting are inter-related activities and the themes of this guidance will apply to each to a greater or lesser extent depending on the specific activity. ...''

    ``4.27 Local authorities should commission services having regard to the cost-effectiveness and value for money that the services offer for public funds. The Local Government Association Adult Social Care Efficiency Programme ( ... ) has advice on these issues and may be helpful. ...''

    ``4.31 When commissioning services, local authorities should assure themselves and have evidence that contract terms, conditions and fee levels for care and support services are appropriate to provide the delivery of the agreed care packages with agreed quality of care. This should support and promote the wellbeing of people who receive care and support, and allow for the service provider ability to meet statutory obligations to pay at least the national minimum wage and provide effective training and development of staff. It should also allow retention of staff commensurate with delivering services to the agreed quality, and encourage innovation and improvement. Local authorities should have regard to guidance on minimum fee levels necessary to provide this assurance, taking account of the local economic environment. This assurance should understand that reasonable fee levels allow for a reasonable rate of return by independent providers that is sufficient to allow the overall pool of efficient providers to remain sustainable in the long term. The following tools may be helpful as examples of possible approaches:

    · UKHCA Minimum Price for Homecare ( ... )

    · Laing and Buisson toolkit to understand fair price for residential care ( ... )

    · ADASS paying for care calculator ( ... )''

  11. I was also referred to paragraphs 10.27, 11.4 and 11.10 of, and paragraph 11 of Annex A to, the Guidance:

    (1) Chapter 10 of the Guidance is headed ``Care and support planning''. The introduction to chapter 10 states that it provides guidance on sections 24 and 25 of the Act. Paragraph 10.27 provides as follows:

    ``In determining how to meet needs, the local authority may also take into reasonable consideration its own finances and budgetary position, and must comply with its related public law duties. This includes the importance of ensuring that the funding available to the local authority is sufficient to meet the needs of the entire local population. The local authority may reasonably consider how to balance that requirement with the duty to meet the eligible needs of an individual in determining how an individual's needs should be met (but not whether those needs are met). However, the local authority should not set arbitrary upper limits on the costs it is willing to pay to meet needs through certain routes - doing so would not deliver an approach that is person-centred or compatible with public law principles. The authority may take decisions on a case-by-case basis which weigh up the total costs of different potential options for meeting needs, and include the cost as a relevant...

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