Statutory Charge: Care Costs and Human Rights Act Applications

Tuesday 18 September 2018

Northamptonshire County Council & Anor v The Lord Chancellor (via the Legal Aid Agency) [2018] EWHC 1628 (Fam) (05 June 2018) “The moral injustice arising out of such a situation is palpable: claimants who have been appallingly let down by a local authority would find themselves recovering money from a public body with one hand only to give it back to another public body with the other”.

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The following guidance applies when making an HRA application:

  1. Make a separate and standalone application;
  2. Keep costs of pursuing the HRA claim separate from the care case.

The purpose of this is to ensure that damages are not awarded in the care case. If they are, the statutory charge will apply and be linked to the costs of the care proceedings. However, if the HRA claim is completed outside of care proceedings and funded by legal aid, the costs of pursuing that claim would be still subject to a statutory charge, but the statutory charge would be linked only to the costs of the HRA proceedings which would likely be substantially less.

In reality the position is this:

  1. HRA claims must be pursued separately from care proceedings if the clients hope to access any damages they are awarded;
  2. If the client is self-funding/funded on a pro-bono basis the statutory charge will not apply as there are no claims being made to Legal Aid;
  3. If the client is legally aided the statutory charge will apply but only to the proceedings the damages are awarded in.

The patent unfairness of setting the entirety of the care proceedings against the public funds has been allayed if solicitors are aware of the above guidance. But, how to fund the raft of costs that come alongside free-standing applications; and whether there would be any money left in the ‘award pot’ once the statutory charge is claimed against any long-standing contested free-standing applications for HRA declarations remains to be seen. In those cases a costs order against the Local Authority would be the only way to keep the award untouched.

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