R (BG) v Medway Council

JurisdictionEngland & Wales
CourtQueen's Bench Division (Administrative Court)
Judgment Date2005
Neutral Citation[2005] EWHC 1932 (Admin)
Date2005

Disabled child – Local authority – Statutory powers – Provision of services for children in need – Adaptations to home – Whether conditions of discretionary loan offered to fund adaptations reasonable – Chronically Sick and Disabled Persons Act 1970, ss 2(1), 28A – Children Act 1989, Pt III.

The claimant, BG, was a disabled child. There was an established need for adaptations to the family home to cater for his needs. In compliance with the requirement under ss 2(1) and 28A of the Chronically Sick and Disabled Persons Act 1970 the local authority offered funding to provide assistance in arranging for the carrying out of works of adaptation to his home by the exercise of its functions under Pt III of the Children Act 1989. It offered to fund the shortfall in the costs of the works remaining after application of the maximum available grants by way of a loan secured on the home, which would be discharged after 20 years without any requirement for repayment. The loan was subject to conditions, inter alia, that the authority would not seek repayment unless the claimant ceased to live at the home during those 20 years. In correspondence between the parties, the authority made it clear that, in the event of liability to repay arising, it would have regard to the family’s circumstances when determining whether and on what terms to require repayment, and that it would not act unreasonably in requiring repayment immediately or on terms that would cause financial hardship. The claimant, through his father as litigation friend, applied for judicial review. Issues arose, inter alia, as to whether the conditions of the loan offered by the authority in the exercise of its discretion were lawful and whether it was reasonable to require the repayment of the full amount if the claimant ceased to live at the home after 19 years, when it could be said that the purpose of the loan had been substantially fulfilled.

Held – In all the circumstances of the instant case, the relevant conditions were not unreasonable. The conditions were reasonably related to the purpose for which the financial assistance was being provided, namely to enable the claimant to live at home in the long term. In those circumstances, it was reasonable for the authority to make provision for repayment, after having regard to the family’s circumstances, if he ceased to live at the house, especially in view of its limited resources and overall responsibilities, and for

the conditions to apply over a 20-year period. Furthermore, although there were concerns over the all or nothing nature of the requirement to make repayments, such a simple repayment model was reasonably within the range of options open to the authority. The application would be dismissed.

Cases referred to in judgment

Anufrijeva v Southwark London BC[2003] EWCA Civ 1406, [2003] 3 FCR 673, [2004] 1 All ER 833, [2004] QB 1124, [2004] 2 WLR 603, [2004] 1 FLR 8.

Cowl v Plymouth City Council[2001] EWCA Civ 1935, [2002] 1 WLR 803.

R (on the application of Ali) v Birmingham City Council [2002] EWHC 1511 (Admin), [2003] LGR 238.

R (on the application of Bernard) v Enfield London BC [2002] EWHC 2282 (Admin), [2003] LGR 423.

R (on the application of Spink) v Wandsworth London BC[2005] EWCA Civ 302, [2005] 1 FCR 608, [2005] 2 All ER 954, [2005] 1 WLR 2884.

R (on the application of Stephenson) v Stockton-on-Tees BC[2005] EWCA Civ 960, [2005] 3 FCR 248.

R v Birmingham City Council, ex p Mohammed [1998] 3 All ER 788, [1999] 1 WLR 33.

R v Devon CC, ex p Baker [1995] 1 All ER 73, CA.

R v Royal Borough of Kensington and Chelsea, ex p Kujtim [1999] 4 All ER 161, CA.

Sentges v Netherlands App no 27677/02 (8 July 2003, unreported), ECt HR.

Claim

The claimant, through his father as litigation friend, applied for judicial review of the local authority’s decision in relation to a loan. The facts are set out in the judgment.

Stephen Cragg (instructed by Disability Law Service) for the claimant.

Christopher Baker (instructed by Medway Legal Services) for the defendant.

RICHARDS J.

[1] The claimant, BG, is a three-year old boy with severe mental and physical disabilities. His condition includes four limb cerebral palsy, epilepsy, asthma, and sleep problems. He needs assistance with all aspects of daily living and mobility. He lives at home with his parents and an elder brother and younger sister, and the family’s hope and intention is that he should continue to live at home indefinitely. At present, however, the family is suffering from sleep disruption and is becoming exhausted and emotionally drained because there is insufficient space in the home to cater adequately for his needs. There is an established need for adaptations to the home to provide more space, so as to enable him to have his own room, to provide sufficient storage space for all the necessary equipment and to provide room for his treatment, such as daily physiotherapy. The adaptations will cost about £65,000. The present

proceedings, which the claimant brings by his father as litigation friend, are directed towards one of the ways in which it is proposed to meet that cost.

[2] The defendant council proposes that the cost should be met in three ways.

(i) It has approved a disabled facilities grant (DFG) in the statutory maximum sum of £25,000. This followed a means test that showed that BG’s parents were not liable to make any contribution to the works. BG’s father earns £14,000 per annum and is in receipt of child tax credit (with family, child, disability and severe disability elements). There is no issue about the DFG.

(ii) It has agreed to make a discretionary non-repayable grant of £10,000 from its social services top-up fund, which is said to be the ‘maximum … available from social services within current policy’. Although comment is made on the claimant’s behalf that the details of the policy have not been disclosed and no explanation has been given as to why a greater sum cannot be provided in this way, the maximum limit applied by the council is not the subject of challenge.

(iii) It has offered to fund the shortfall, up to a maximum amount of £30,000, by way of financial assistance in the form of a secured loan on specified conditions. No complaint is made of the principle of proceeding by way of a secured loan. But the claimant’s parents object to certain of the conditions, and the issue in these proceedings is whether those conditions are lawful.

[3] The offer of financial assistance to fund the shortfall is contained in a letter dated 24 January 2005 from the council to BG’s father. The relevant terms of the offer are these:

‘In view of the fact that there is a shortfall and you are unable to provide this from your own funds due to your financial circumstances, the council is prepared, in this instance, to fund the shortfall up to a maximum amount of £30,000 so as to enable [BG] to be cared for in his own home. The offer of financial assistance is therefore subject to the following conditions …

5. the sum of £30,000 to be secured by way of second legal charge on [the family home] for a period of 20 years. The council will not seek repayment of this sum unless one of the following events occur within the period of 20 years, in which case the council may require repayment together with interest. The events are:

5.1 you fail to comply with any term, condition, covenant or provision of, or to perform any obligation or liability under the legal charge;

5.2 any representation or warranty given by you to the council in connection with this matter is incorrect or found to be incorrect;

5.3 the first mortgagee or another mortgagee takes possession of the property or exercises its power [of] sale;

5.4 a bankruptcy order is made against you or you enter into a voluntary arrangement with your creditors under Part VIII of the Insolvency Act 1986;

5.5 there is a disposal of the property either by way of sale, lease or the parting with possession or occupation;

5.6 [BG] no longer permanently resides at the property or dies.

Providing none of the above events occur, then the legal charge will be discharged after a period of 20 years without any requirement for you to repay the monies, other than the cost of redemption.’

[4] The offer was followed by a lengthy exchange of correspondence, in which concerns were expressed by BG’s parents about some of the terms of the loan and various legal objections were raised, first by the parents’ original solicitors and then by their present legal advisers, to whom they had switched by early March 2005. It is unnecessary to examine the details of that correspondence. As matters have developed, objection is now taken to (a) the length of the 20 year term, (b) the fact that the council may require repayment of the sum if BG ceases to reside permanently at the property or dies, and (c) the fact that the council may require payment of interest on any amount repayable. As to (c), it appears from other documents and from information provided at the hearing that the interest would be simple interest at 2% above NatWest base rate from time to time and would run from the date of the deed.

[5] The council’s position can be extracted in part from the exchange of correspondence to which I have referred, but is most conveniently set out in a witness statement of Jackie Challis, the council’s disability support manager. That witness statement recites the history of the matter and the context within which the offer was made. It states that the number of disabled people in Medway is about 4,855 and that the council received 1,572 referrals in 2004/2005 for assessments and service provision for people with disability. The annual social services budget for discretionary loan and grant assistance for all disabled people is only £200,000 (though the total social services budget for providing services to disabled people is not in evidence). Having referred to the DFG of £25,000 and the top-up grant of £10,000 agreed in relation to...

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