Human rights—Public authority—Private person performing functions of a

House of Lords
Lord Bingham, Lord Scott, Baroness Hale, Lord Mance and Lord Neuberger
20 June 2007

Where a local authority, in the discharge of its duty under s 21 of the National Assistance Act 1948 (NAA 1948), makes arrangements for the provision of care and accommodation by a private care home, that home is not exercising functions of a public nature within s 6(3)(b) of the Human Rights Act 1998 (HRA 1998).

David Pannick QC, Ian Wise, Naina Patel (instructed by Irwin Mitchell) for the claimant.
Andrew Arden QC and David Carter (instructed by the Legal Department, Birmingham City Council) for the authority.
Beverley Lang QC and Ivan Hare (instructed by Lester Aldridge) for the care home.
Helen Mountfield (instructed by Bailey Wright & Co) for the claimant and her daughter.
Philip Sales QC and Cecilia Ivimy (instructed by the Treasury Solicitor) for the Secretary of State for Constitutional Affairs as intervener.
Michael Fordham QC, Jessica Simor and Iain Steele (instructed by Liberty) for Justice, Liberty and British Institute of Human Rights as interveners.
Rabinder Singh QC, David Wolfe and Samantha Knights (instructed by Help the Aged and the National Council on Ageing) for Help the Aged and the National Council on Ageing as interveners.
Robin Allen QC and David Wolfe (instructed by Disability Rights Commission) for the Disability Rights Commission as intervener.

The claimant had lived in a private care home since January 2006. Her residence was largely funded by the first defendant local authority. It was covered by a “three way” placement agreement signed in February 2006 by the care home owner as the “provider”, the authority and the claimant’s daughter (acting on the claimant’s part), as well as by a third party funding agreement between the authority and the daughter.

Under those agreements the provider received a basic fee from the authority and a top-up fee from the daughter. In arranging the placement the authority acted pursuant to its duty under NAA 1948, s 21. A dispute arose between the provider and the daughter concerning the behaviour of the claimant’s husband and the daughter. In subsequent proceedings the issue arose about whether the provider had “functions of a public nature” and was therefore a public authority, under HRA 1998, s 6(3)(b). The judge held that it was not, as did the Court of Appeal. The claimant appealed. 

LORD MANCE:

Section 21 of NAA 1948 provided: “(1)...a local authority may...make arrangements for providing—(a) residential accommodation for persons...in need of care and attention which is not otherwise available to them…”
Section 6 of HRA 1998 identified two types of public authority —“core” public authorities which were to be so regarded in relation to all their functions and “hybrid” persons with functions both of a public and of a private nature which were only to be so regarded when the nature of their particular act under consideration was public rather than private.

His Lordship did not regard the actual provision, as opposed to the arrangement, of care and accommodation for those unable to arrange it themselves as an inherently governmental function. The duty on a local authority under s 21 constituted a safety net, conditional upon care and attention being “not otherwise available”. In practice, that meant that, if a person assessed as in need of care and accommodation had more than £21,000 capital and could arrange care and accommodation or (for example through relatives) make arrangements for it, then the local authority would not be further involved. In contrast with the position relating to the National Health Service, the default position was one in which the local authority was not involved.

There was no basis on which a private care home could somehow be regarded as exercising functions of a public nature in providing care and accommodation for “self-funders”, those who or whose relatives could fund and make their own arrangements. The local authority’s involvement was aimed at making arrangements (including funding) which put those in need in effectively the same position as those “self-funders”. Once such arrangements were made, the actual provision of care and accommodation was a different matter, which did not need to be undertaken by the local authority and could take place in the private sector, as it did for those who were able to make arrangements for themselves.

In providing care and accommodation, the provider acted as a private, profit-earning company. It was subject to close statutory regulation in the public interest; but so were many private occupations and businesses, with operations which might impact on members of the public. Regulation by the state was no real pointer towards the person regulated being a state or governmental body or a person with a function of a public nature, if anything perhaps even the contrary.

The private and commercial motivation behind the provider’s operations did in contrast point against treating the provider as a person with a function of a public nature. Some of the particular duties which it had been suggested would follow—a duty not to close the home without regard to the European Convention on Human Rights (the Convention) right to a home of publicly funded residents, and perhaps even a duty to give priority to accepting such residents into the home—fitted uneasily with the ordinary private law freedom to carry on operations under agreed contractual terms, even accepting that, if the Convention applied, a private care home would be able to invoke that freedom as a relevant factor under Art 8(2).

Any differences between care home residents whose placement was arranged under s 21 and private residences could not either justify or require a different approach to the application to the care home of the Convention. Apart from any contractual arrangements, the care home should view and treat all such residents with equality.
The appeal would therefore be dismissed.

Lord Scott and Lord Neuberger delivered concurring opinions and Lord Bingham and Baroness Hale dissented.