In R (KM) v Cambridgeshire CC  UKSC 23 (click here for the transcript), the Supreme Court (Lord Phillips, Lord Walker, Lady Hale, Lord Brown, Lord Kerr, Lord Dyson and Lord Wilson) has delivered its second community care judgment in 12 months, the first being R (McDonald) v Kensington & Chelsea RLBC  UKSC 33 (click here for the transcript).
The case is a disappointment. Permission to appeal was granted on the basis that the appeal called into question the 3:2 decision of the House of Lords in R v Gloucestershire CC ex p Barry  AC 584, that it was potentially lawful for a local authority to take into account its financial resources when deciding whether it was under a duty to provide a service under section 2 of the Chronically Sick and Disabled Persons Act 1970. Having granted permission to the Secretary of State for Health, the Secretary of State for Work and Pensions and four leading charities to intervene on this issue, and having convened itself as a panel of 7, the Supreme Court then decided that it was an issue that was irrelevant to the appeal (as, it appears, Cambridgeshire had maintained throughout), so the Supreme Court should not hear any argument on it.
One can understand why case management may not be a priority in the Supreme Court and why parties to appeals may feel diffident about raising case management issues; but perhaps that needs to be reviewed in view of the substantial waste of charitable and public funds, let alone valuable Supreme Court time, that resulted in this instance.
As far as concerns the only substantive issue between the parties, the Supreme Court wrapped that up speedily: Cambridgeshire’s offer of £85,000.00 per annum reflected a rational computation of the cost of meeting the appellant’s eligible needs in that, although the computation included a significant error, that error was in the appellant’s favour; further, Cambridgeshire’s reasons were ultimately, after some to-ing and fro-ing on its part, adequate. There is nothing of wider interest here.
So what is left to rescue the decision from total pointlessness? Five things, perhaps.
First, Lord Wilson on behalf of the Supreme Court provided a characteristically elegant distillation of the Barry principles, as they operate in an era of direct payments:
15. When a local authority is required to consider whether it is "necessary in order to meet the needs of that person for that authority to make arrangements for" the provision of any of the matters on the service list, it is required to ask itself three questions and should do so in three separate stages:
(i) What are the needs of the disabled person?
(ii) In order to meet the needs identified at (i), is it necessary for the authority to make arrangements for the provision of any of the listed services?
(iii) If the answer to question (ii) is affirmative, what are the nature and extent of the listed services for the provision of which it is necessary for the authority to make arrangements?
There is a fourth potential stage of the inquiry which I will identify in para 23 below………..
23. So, in cases like the present in which a disabled person qualifies for a direct payment in lieu of its own provision of services to him, the local authority is required to proceed to the fourth stage as follows:
(iv) What is the reasonable cost of securing provision of the services which have been identified at (iii) as being those for the provision of which it is necessary for the authority to make arrangements?
Second, the Supreme Court gave a reasonably clear steer that a local authority’s financial resources are only relevant at the second stage (although, it goes almost without saying, at the third and fourth stages an authority is of course entitled to provide the most cost-effective services that meet eligible needs). Lord Wilson said, at paragraph 5, that “if and insofar as it was there held [in Barry] that constraints upon resources were also relevant to what I will describe as the first stage, there are arguable grounds for fearing that the committee fell into error”. Lady Hale made it clear that, in her view, the ratio of Barry was that resources were relevant only at the second stage and not at the first.
That all seems right. However, given that this seems obviously right, and is the basis on which Prioritising Need in the context of Putting People First proceeds (i.e. assess “needs” objectively, then determine which needs are “eligible” taking into account resources/eligibility criteria), it is difficult to see who is going to argue differently or why this issue could be regarded as at all controversial.
Third, Lord Wilson confirmed at paragraph 21 that, as was common ground between all the parties, “once the second stage has been passed………….. by an identification of the requisite necessity and thus of the eligibility of the needs, the duty of the local authority to make provision for them in accordance with the third and fourth stages of the inquiry becomes absolute”. That has never been controversial, at any stage in the history of community care law, but it is still good to see it spelled out.
Fourth, between paragraphs 23 and 28 Lord Wilson gave a clear explanation, and endorsement, of the way Resource Allocation Schemes operate and at paragraph 37 he approved Lord Justice Maurice Kay’s ruling in R (Savva) v Kensington & Chelsea RLBC  EWCA Civ 1209, that councils must provide adequate reasons, which may be brief, as to how it worked out that the sum of money offered would meet care costs – albeit that, even in a relatively complex case “it may be enough for the authority, as here, to attribute a compendious cost to a group of requisite services of similar character”. Again, this adds certainty to what has been generally understood to be the case, since the decision in Savva.
Fifth – and this could be the most interesting part of the decision – Lord Wilson stated “I agree with Langstaff J in R (L)_v Leeds CC  EWHC 3324 Admin, at para 59, that in community care cases the intensity of review will depend on the profundity of the impact of the determination. By reference to that yardstick, the necessary intensity of review in a case of this sort is high………..[and there needs to be] close scrutiny of the lawfulness of a monetary offer. On the other hand respect must be afforded to the distance between the functions of the decision-maker and of the reviewing court; and some regard must be had to the court’s ignorance of the effect upon the ability of the authority to perform its other functions of any exacting demands made in relation to the manner of its presentation of its determination in particular type of case. So the court has to strike a difficult, judicious balance”.
It is of interest that paragraph 59 of the Leeds case, to which Lord Wilson took the trouble to refer, makes express reference to the decision of the court of appeal in R (Ireneschild) v Lambeth LBC  EWCA Civ 2345 (click here for the transcript). However, Lord Wilson’s carefully modulated approach might be thought to contrast unfavourably with the approach in Ireneschild, see, in particular, at paragraph 44 of Ireneschild:
44. Mr Drabble further conceded that the Respondent, having brought the proceedings to review the assessment judicially, bore the heavy burden of establishing that the assessment was unlawful. He did not attempt to persuade this court to ignore the strictures of Lord Brightman inPuhlhofer v Hillingdon LBC  AC 484, 518B-E put before us by Mr Béar. Lord Brightman said this:
"My Lords, I am troubled at the prolific use of judicial review for the purpose of challenging the performance by local authorities of their function under the Act of 1977. Parliament intended the local authority to be the judge of fact. The Act abounds with the formula when, or if, the housing authority are satisfied as to this, or that, or have reason to believe this, or that. Although the action or inaction of a local authority is clearly susceptible to judicial review where they have misconstrued the Act, or abused their powers or otherwise acted perversely, I think that great restraint should be exercised in giving leave to proceed by judicial review. The plight of the homeless is a desperate one, and the plight of the applicants in the present case commands the deepest sympathy. But it is not, in my opinion, appropriate that the remedy of judicial review, which is a discretionary remedy, should be made use of to monitor the actions of local authorities under the Act save in the exceptional case. The ground upon which the courts will review the exercise of an administrative discretion is abuse of power- e.g. bad faith, a mistake in construing the limits of the power, a procedural irregularity, or unreasonableness in the Wednesbury sense – unreasonableness verging on an absurdity: see the speech of Lord Scarman in Reg. v. Secretary of State for the Environment, Ex Parte Nottinghamshire County Council  AC 240, 247-248. Where the existence or non-existence of a fact is left to the judgment and discretion of a public body and that fact involves a broad spectrum ranging from the obvious to the debatable to the just conceivable, it is the duty of the court to leave the decision of that fact to the public body to whom Parliament has entrusted the decision-making power save in a case where it is obvious that the public body, consciously or unconsciously, are acting perversely."
Those remarks may have been directed at a different statutory function in a different era, but, to my mind, they are as pertinent today as they were in the 1980s.
If nothing else, paragraph 36 of Lord Wilson’s judgment suggests a more carefully nuanced approach to community care decisions in the future – welcome news for applicants, not of any concern for councils who make careful and sensitive decisions and it seems fair to all sides.
Otherwise, as occurred also with the McDonald case (see our earlier case analysis), the Supreme Court has felt unable through the medium of the case before it to engage meaningfully with the hugely important issues of the day, in community care, which for the most part revolve around the extent to which financial considerations can ratchet down the provision of care services. For that, we will have to wait another day – and who knows when that day will come