[2025] EWHC 1680 (KB)

This dispute concerns whether the Defendant should pay for the costs of accommodating DB, a member of the public with serious mental health challenges. He was detained in 2008 under the Mental Health Act 1983 (the Act). He was released in 2009. There is no dispute between the parties that, under S.117 of the Act, the Defendant was under a duty to provide, in cooperation with relevant voluntary agencies, “aftercare services” for him until such time as the Defendant was satisfied that he no longer needed such services. The Defendant placed DB in the Claimant’s care home at Ringstead House, in Lewisham. A dispute arose between the Claimant and the Defendant which was settled in August 2015, at which time DB was moved to the Claimant’s supported living accommodation at Radnor House, Southwark. Correspondence was exchanged in August 2015 between the parties about the cost of the care element of the necessary aftercare services at Radnor House and that correspondence has become the subject of one part of the claim. Despite some obscure pleading in the Defence it appears beyond dispute that DB lived there until 2022.

There was evidence under the heading “New Evidence” in the appeal bundle which was not before the Judge. This included a 2021 FACE assessment by the Respondent. No application was made to admit it. No objection was taken to it being in the bundle or to me reading it. I do consider it to be relevant. It could have an important influence on the result and is clearly credible. I was not addressed on whether it was obtainable at the hearing below. I do not admit it in evidence due to the lack of explanation for the failure to put it before the Judge below. However, I have read the witness statement of Edith Eneanya-Bonito, dated January 2022 and the exhibits, which were before the Judge. Two documents are highly relevant. Firstly, DB’s discharge summary in 2009 set out his very serious mental health condition. Secondly, the written mental health FACE assessment by Hillingdon for DB dated 20.11.2020 (although is contains factual assertions from 2021) listed DB as living at Radnor House. His legal status was: “S.117. 27-Mar-2009 – current”. DB had a diagnosis of paranoid schizophrenia and a history of verbal abuse to carers, absconding, smoking cannabis, violence and refusing medication. He had chronic thought disorder making it difficult for him to communicate. He needed 24 hour supervision at Radnor House. His “finances are managed under an Appointeeship by the London Borough of Hillingdon Client Financial Affairs Team (CFA).” He was at risk of accessing prohibited drugs and he was at “significant risk” in his own accommodation without supervision. He had a history of harm to himself and others. The budget allocated was £25,190 pa. No mention is made payments for accommodation.

The Claimant issued a Claim Form in November 2020 in the County Court Business Centre for £44,253.71 for unpaid accommodation and living expenses. In the Claim Form the Claimant pleaded breach of the governing contract and of the duty of care owed by the Defendant to DB who placed DB in the Claimant’s living accommodation and who failed to remit money to the Claimant for DB’s rent, service charges, food and pocket money. I have put the words duty of care in italics for a reason which will become apparent below. Unjust enrichment was also claimed.

In the Particulars of Claim the Claimant relied on a letter dated 3rd August 2015 settling the parties’ previous dispute, offering for DB to be accommodated in Radnor House and calculating 36 hours of care and support at a cost to the Defendant of £1462.10 per week. In paragraph 6 of that letter the Claimant stated: “if DB continues to stay at Radnor House beyond 08 August 2015, our client will issue him with the tenancy agreement as he would become a supported accommodation tenant, and thereafter the ordinary residence rule will apply to DB as a tenanted client.” The parties are in dispute as to what that meant. The Claimant pleaded that it issued DB with a tenancy agreement at a rent of £150 per week payable through the housing benefits claim made on his behalf. In paragraphs 11 to 13 the Claimant pleaded subsequent difficulties with the DWP who revoked the previous appointment of the Claimant to manage DB’s finances and then transferred the management of his finances to the Defendant. The Claimant then pleaded that it was an express or implied term of the August 2015 contract that the Defendant would pay for or reimburse the Claimant for the accommodation rent, service charges and maintenance costs for DB in Radnor House. In addition, the Claimant asserted an implied term to the same effect based on “usage, custom, practice or dealings between the parties”. The Claimant also pleaded unjust enrichment of the Defendant who, the Claimant believed, was receiving DB’s State Benefits for his accommodation and maintenance and not passing them on. The Claimant pleaded that the transfer of the management of DB’s money occurred in July 2017 and that is when they no longer received payment for his rent and maintenance from the DWP. The Defendant did not pay for DB’s accommodation or maintenance so the Claimant calculated it and claimed it.

In Hillingdon's served Defence they relied on their e-mail of 11th August 2015 and pleaded “in DB’s case, his care and support is provided under section 117 Mental Health Act 1983. The test for determining the responsible authority under that act at the time DB was discharged from hospital was not ordinary residence but residence.” At paragraphs 10 and 11 the Defendant did not deny the tenancy agreement but put the Claimant to proof not only that the agreement was signed but also that DB had the capacity to sign it and that the Claimant owned Radnor House. That was a remarkable piece of pleading and may lead to costs consequences at trial. Objectively, it seems difficult to believe that Hillingdon were paying for carers and support workers to take care of DB at a property which they do not accept the Claimant owned or possessed and under a tenancy agreement that they do not accept DB signed. The Defendant did not plead with any clarity in relation to the DWP benefits which it took over from the Claimant. At paragraph 14 the Defendant pleaded it was unable to admit or deny the assertion that the DWP transferred to the Defendant control over DB’s state benefits. The Defendant required the Claimant to prove the transfer of control to them. That was also a remarkable pleading considering the following paragraphs of the Defence and its own FACE assessment. Whether the Defendant had control over DB’s money starting from 2017 or 2019 should have been a matter wholly within the knowledge of the Defendant. The FACE assessment says that they did. The Defendant denied liability for the monies claimed under what they assert was only a care agreement. In paragraph 20 the Defendant admitted it was DB’s appointee and had started receiving benefits on the 16th of July 2020 thereby contradicting its earlier non-admission. However, the Defendant pleaded that it had not been enriched and stated: “in any event the Defendant is bound to retain such benefits until satisfied that it should, on DB’s behalf, spend those sums.” Stopping there, it seems to me that if the Defendant has received housing benefit and personal independence payments for DB since 2020 but has not paid them over to the Claimant, despite the fact that DB was placed by the Defendant to live in Radnor House during the relevant period and has been fed and accommodated there, then a more specific pleading about why the Defendant has not paid over the benefits received for DB’s accommodation and maintenance was required. The Defendant put the Claimant to proof as to the details of the accounts held for DB, denied any liability to pay, denied contractual obligations to pay, denied that DB had breached any contractual obligations or that the Defendant had caused any such breach and put the Claimant to proof to establish the DB was liable to pay the rent and maintenance sums charged. The Defendant also pleaded that the Claimant had failed to make allowance for the fact that DB was moved out of Radnor House and back into Ringstead House for a period during which maintenance and repairs were affected at Radnor House. That is odd because Ringstead House, being a care home, was more expensive than Radnor House. Unjust enrichment was also denied.

In the Reply (dated 9.8.2021) the Claimant pleaded as to the meaning of the “ordinary residence rule” set out in their letter of the 3rd of August 2015 and as to DB’s capacity when he signed the tenancy agreement. At paragraph 7(c) the Claimant pleaded that by virtue of S.117 of the Act read together with Ss.18 and 75 of the Care Act 2014, the Defendant was under a duty to meet DP's needs for care support and for his placement accommodation rent, service charges and maintenance costs. Further, as an appointee for the receipt of DB’s benefits, the Defendant was liable and bound to pay over for his debts for his accommodation rent, service charges and maintenance costs. The Claimant pleaded that the Defence did not provide justification, by way of facts and matters, for the Defendant to withhold payment of DB’s benefits received from the DWP. The Claimant attached an updated schedule of the debt with the pleading. The rent debt claimed started from 2017.

The orders made in the case can be summarised as follows. On the 16th of December 2020 an administrative officer ordered that it was proposed that the claim be allocated to the multi-track and that Directions Questionnaires and cost budgets be provided on the 18th of January 2021. Neither party complied with the costs budget deadline. However, the Defendant applied to strike out the claim in early 2021. On the 4th of March 2021 HHJ Monty listed the Defendant’s striking out application for hearing later. On the 2nd of August 2021 DJ Greenidge gave directions relating to pleadings. On the 4th of February 2022 HHJ Saggerson dismissed the Defendant’s application to strike out the claim and ordered costs against the Defendant. On the 30th of May 2023 the Claimant filed its costs budget, two years and four months late. On the 31st of May 2023 HHJ Hellman joined DB by consent, on the Claimant’s application, as a Defendant and gave consequential directions. By an order dated the 7th of June 2023 HHJ Hellman ordered a capacity assessment for DB. On the 14th of June 2023 the Defendant applied for relief from sanctions because their cost budget had been delivered one day late (back in January 2021). That application itself was two years and five months late. It should have been dealt with by consent. Three months later, on the 27th of September 2023, the Claimant applied for relief from sanctions for filing their cost budgets late. That application was two years and eight months late. The breach having occurred back in January 2021. On the 27th of November 2023 DJ Greenidge ruled that DB lacked capacity and invited the official solicitor to be the litigation friend.

On the 18th of February 2024 the Claimant applied to strike out the Defence and sought the summary judgment based on the Defendant's late service of their directions questionnaire, amongst other matters.

On the 28th of February 2024 the Claimant applied to amend the particulars of claim. The proposed amendments included: (1) adding DB as second Defendant; (2) adding a factual assertion that DB was arrested in July 2022 and admitted to a mental health ward; and (3) pleading that on 13th October 2022 the Defendant gave notice to the Claimant ending DBS placement at Radnor House managed by the Claimant as of 1st November 2022. All of those amendments should have been allowed in but were not, as I shall explain below. It seems to me that the asserted fact in (3), if true, in itself rather showed up the obstructive nature of the Defendant’s initial pleading, which invited the Claimant to prove where DB was placed and whether the Claimant had control over Radnor House. In any event the amended pleading went on to assert: (4) at paragraph 14 that, by virtue of S.117 of the Act, supported living services including accommodation rent and maintenance were part of his “aftercare” and which the Defendant had the duty to fund. The Claimant also sought to rely on the Local Government and Social Services Care Ombudsman’s decisions on complaints against the Defendant, the detail of which was not pleaded out. At paragraph 21(a) the Claimant asserted that the Defendant was liable to pay DB’s aftercare costs, including the claimed debt under S.117 of the Act and as the responsible local authority and as the appointee for DB under a DWP letter dated second April 2019 in which the DWP asked the Claimant to liaise with the first Defendant for DB’s benefits.

Directions were given for the hearing of the applications by both parties for relief from sanctions, by the Claimant to strike out/summary judgment and for the permission to amend the Particulars of Claim. The hearing was then adjourned by HHJ Bloom in July 2024 and finally heard on the 12th of August 2024 by the Judge. On that day, in addition to the orders which are appealed, the Judge allowed the Defendant’s application for relief and rejected the Claimant’s application to strike out the Defence and for summary judgment.