Care North East Northumberland, R (on the application of) v Northumberland County Council

6 June 2024

[2024] EWHC 1370 (Admin)

High Court

A group of care homes sued the council because they thought the council wasn't paying them enough. The judge said the council followed the rules and had good reasons for its decisions, so the care homes lost the case.

Key Facts

•Care North East Northumberland (Claimant) challenged Northumberland County Council's (Defendant) decisions on care home weekly fees for 2023/24.
•The 2021 Agreement between the Council and care home operators included an annual fee revision mechanism based on the National Living Wage and CPIH inflation.
•The Council's decisions involved applying the Basic Contractual Mechanism, declining further uplifts, and using the Market Sustainability and Improvement Fund (MSI Fund) for a top-up increase.
•The Claimant argued the Council failed to adequately consider market sustainability when setting fees and misinterpretated the MSI Fund grant conditions.

Legal Principles

General statutory duty of local authorities to promote efficient and effective operation of a care market.

Care Act 2014, s.5

Mandatory relevancy of ensuring market sustainability when performing the general duty.

Care Act 2014, s.5(2)(d)

Central Government's power to pay conditional local authority grants.

Local Government Act 2003, s.31

Conventional grounds for judicial review apply to decisions about fee increases where market sustainability is legally relevant.

Care England v Essex County Council [2017] EWHC 3035 (Admin)

Decision-maker must ask the right question and conduct a legally sufficient inquiry.

Care North East (No.1) v Northumberland County Council [2013] EWCA Civ 1740

Decision-maker must give legally adequate reasons.

Various case law

Court should be cautious about imposing public law duties that dilute or alter freely concluded contractual terms.

R (Birmingham and Solihull Taxi Association) v Birmingham International Airport Ltd [2009] EWHC 1913 (Admin)

Outcomes

Claim for judicial review dismissed.

The Court found the Council's decisions were lawful. The Council asked and answered the relevant question regarding market sustainability, conducted a legally sufficient inquiry, and provided legally adequate reasons. The alleged misinterpretation of the MSI Fund grant conditions was also rejected.

Permission for judicial review refused for a quashing order.

Significant delay in bringing the claim and detriment to good administration.

Permission for judicial review granted for a declaration, but the substantive claim dismissed.

All issues raised were arguable, but none of the grounds succeeded.

Claimant to pay Council's costs.

Claimant lost the case.

Permission to appeal refused.

No realistic prospect of success on appeal.

Care North East Northumberland, R (on the application of) v Northumberland County Council

Key Facts

Legal Principles

Outcomes

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