Short-notice care home closures

Legal Issues: Examples and tips

The following key issues were identified through the feedback exercise which helped to shape the production of this guide. Legal advice should always be sought appropriate to individual and local circumstances.

• Statutory dutyOpen

  The local authority's mandatory statutory duty to eligible people already resident in the home is to meet their assessed eligible needs appropriately and safely (to do otherwise would be a breach of statutory duty, potentially enforceable by injunction). Leaving a person in an inadequate home on the brink of failure or closure could lead to a breach of their rights under the Human Rights Act HRA.  It is part of the duty to re-assess someone's needs before attempting to move them (if circumstances permit this to be a planned part of the re-provisioning - that is, it may not be possible in extreme circumstances such as fire or flood, to undertake this duty, but a review would then be conducted at the first opportunity).  In reassessment, the law requires best interests of the residents and their families are considered, in compliance with the Choice Rights outlined in Choice Directions and that appropriate consents are observed in accordance with the Mental Capacity Act.

  Because of their additional vulnerability at a time of crisis, the transfer must be effected as carefully as possible to avoid causing harm and their human rights must be seen to be taken into account, in accordance with the extent the scale of the crisis allows time to do so.

• Choice directionsOpen

  The Choice Direction and Guidance
  When someone is moved from one residential home to another the four provisions of the Choice Directions still apply - re-accommodating is therefore subject to:

  1. availability of suitable alternative accommodation (including, of course, the home that is closed down. This is an obvious point, but it is not a reasonable choice for a resident to choose to remain where they are when the administrator has made the legally enforceable decision to close down the property or has abandoned the local authority's contract for the resident's place in it
  2. suitability of alternative accommodation to meet the person's assessed need
  3. the usual rate paid for such accommodation is acceptable to the new residential care provider. If it is not, and there is no other alternative accommodation for the person, meeting their assessed needs, the commissioning authority has no choice but to pay whatever rate is necessary to get them satisfactorily placed.
  4. choice has been offered where it is possible and feasible to offer options that enable the resident to make a positive choice based on their preferences and all other conditions in 1, 2 and 3 above can be met.

• ResidenceOpen

  In circumstances where a service user is currently accommodated in a home whilst waiting for a placement in their home of choice, local agencies must:

  •    identify and arrange placement in the home of choice as a first option, (subject to the directions on choice), where possible

  •  when undertaking a needs and risk assessment, determine the potential impact that a further temporary move may have upon the individual's health and wellbeing. This should include an assessment of their mental capacity to make decisions.

  Local agencies must ensure that 'assessed need' is a key determinant in selecting and/or funding a care placement. The care setting must be able to meet the assessed needs of service users. Service users should not be placed in a setting, even if this is the home of choice, merely because there is a vacancy if the assessed needs can't be met.

  
  

• Mental Capacity ActOpen

  The Mental Capacity Act is crucial to decision-making by health and social care professionals, which must always be made in the light of the five Statutory Principles of the MCA:
  
  1. A person must be assumed to have capacity unless it is established that they lack capacity.
  2. A person is not to be treated as unable to make a decision unless all practicable steps to help him do so have been taken without success.
  3. A person is not to be treated as unable to make a decision merely because he makes an unwise decision.
  4. An act done, or decision make, under this Act for or on behalf of a person who lacks capacity must be done, or made, in his best interests.
  5. Before the act is done, or the decision is made, regard must be had to whether the purpose for which it is needed can be as effectively achieved in a way that is less restrictive of the person’s rights and freedom of action.
  
   Following the Statutory Principles of the MCA, and working within a human rights based framework, all efforts must be made to enable people to make decisions concerning themselves.

  • If a resident has capacity to understand the options for provision of future care, then that person makes the decision, with their decision-making capacity enriched by appropriately-presented information about the alternatives.
  • If a person might be able to make the decision for themselves, all concerned professionals must maximise that person’s capacity (Principle 2), by careful and person-centred explanation (e.g. delivered in appropriate language, using appropriate aids, ensuring that the person is presented with the information at the time of day when they are most alert).
    
    

  (See MCA s.1; MCA Code of Practice, Chapter 2).
  
  Mental capacity must be assessed in a decision-specific and time-specific way - can the person make a certain decision at the time it needs to be made.  To work this out, you need to think about the two-stage test of capacity: firstly, is there any impairment of, or disturbance in, the functioning of the mind or brain?  (note that this can be temporary or permanent; you do not need a diagnosis; a person’s capacity can be impaired by, for example, an infection or flu, or by bereavement).  The second question is, does this impairment mean that the person cannot make this decision when it needs to be made?  A person has capacity to make a decision only if they can carry out all four of these steps in relation to that decision:

  • Understand appropriately-presented information about that decision
  • Retain the information, just for long enough to
  • Use and weigh it to reach a decision, and
  • Communicate that decision by any recognisable means
    
    

  (See MCA s.2; MCA Code of Practice Chapter 4)
  
  If a person lacks capacity to make the decision about where to live following a care home closure, then professionals (social workers/care managers) or family members (if they hold a Personal Welfare Lasting Power of Attorney which has been registered with the Office of the Public Guardian) must make that decision in the best interests of the person. If time allows (or, if a decision is made in an emergency, then at the first opportunity) the following best interests checklist must be considered:

  • Consider whether the person is likely to regain capacity and, if so, whether the decision can wait
  • Involve the person in the decision as much as possible
  • Explore the person’s past and present views, culture, religion and attitudes
  • Do not make assumptions based on a person’s age, appearance, condition or behaviour
  • Consult interested family and friends
  • Search for the least restrictive option that meets the need.
    
    

  (See MCA s.4; MCA Code of Practice Chapter 5)
  
  Note that if a person is facing a big decision about where to live, and lacks capacity to make that decision, and has no family or friends able and willing to be involved and consulted as part of the decision-making, then the relevant local authority MUST involve an independent mental capacity advocate (IMCA) as part of the decision-making process. The IMCA does not become the decision-maker, but the decision-maker must be able to demonstrate, whether they agree with any proposals suggested by the IMCA or not, that they have taken the views of the IMCA into account in reaching their decision.
  
  (See MCA ss. 35-41; MCA Code of Practice Chapter 10)
  
  (Source: Advice from Provider Development Manager, Mental Capacity Act | English Community Care Association/ Social Care Institute for Excellence)

• Administrative receivershipOpen

  Administrative receivership differs from simple receivership in that an administrative receiver is appointed over all of the assets and undertakings of the company owning the home. Insolvency legislation usually grants wider powers to administrative receivers, but also controls the exercise of those powers to try to mitigate potential prejudice to unsecured creditors. The administrative receiver's first responsibility may be to the creditors - a commissioner must engage early to ensure that the administrative receiver is aware of the plans to minimise harmful disruption to existing residents. An administrator has the power to close down a business with immediate effect, or choose to continue trading, or to sell the business. An administrator may also abandon contracts (but this will be in accordance with the provisions for termination within the commissioner's contract with the care provider).

  The administrator's principal role is to stabilise the situation and to attend to matters of principal concern** relating to continued and viable trading and they will ensure involvement of all operational, regulatory or financial stakeholders***.

• Principal Role of the Administrator*Open

  • Rescue the company so that it can remain a going concern.
  • Achieve a sale that enables it to continue as a going concern.
  • Realise a better outcome than winding-up or liquidation.
  • Provide shareholders with options to vote on.

• Matters of principal concern to Administrator**Open

  • Getting stability and control over activity
  • Stay trading
  • Clear communications to everyone that it's 'business as usual'. This includes residents/relatives, other 'customers', employees, unions, banks and other financial creditors, trade creditors and suppliers, landlords, government and regulators, pension funds.
  • Managing media coverage.
  • Achieving a cash positive business, which might involve securing funding to trade BUT also to ensure that creditors aren't disadvantaged by trading.
  • Exercising tight control so that the fiscal position doesn't worsen.
  • Reducing liabilities.
  • Developing a realisable exit strategy. Where properties are concerned, this may involve keeping/selling good sites, restructuring underperforming sites to keep/sell, closing bad sites.

• Governmental/regulatory or operational stakeholders of care sector***Open

  Regulatory

  • Care Quality Commission (CQC) in England); - Social Care and Social Work Improvement (CSWIS) in Scotland; Care Standards Inspectorate for Wales (CSIW); Regulation and Quality Improvement Authority (RQIA) in Northern Ireland.
  • Office for Standards in Education, Children's Services and Skills (OFSTED)
  • Association of Directors of Adult Social Services (ADASS)
  • Office for Budget Responsibility
  • Office for Disability Issues
  • Parliament/Devolved governments
  • Monitor

  Financial

  • HM Revenue and Customs (HMRC)
  • HM Treasuring
  • Insolvency Services
  • Redundancy Payment Services

  Operational

  • Individual local authorities (according to contracts)
  • NHS - PCT or other healthcare commissioners including GP consortia
  • Local Government Association
  • Department for Work and Pensions
  • Department for Business, Innovation and Skills

• Human Rights ActOpen

  Human Rights Act (PDF)

  The Human Rights Act came into force on 2 October 2000 and incorporates into UK law certain rights and freedoms set out in the European Convention on Human Rights such as:

  • right to life (Article 2)
  • protection from torture and inhuman or degrading treatment or punishment (Article 3)
  • protection from slavery and forced or compulsory labour (Article 4)
  • right to liberty and security of person (Article 5)
  • right to a fair trial (Article 6)
  • protection from retrospective criminal offences (Article 7)
  • The protection of private and family life (Article 8)
  • freedom of thought, conscience and religion (Article 9)
  • freedom of expression (Article 10)
  • freedom of association and assembly (Article 11)
  • right to marry and found a family (Article 12)
  • freedom from discrimination (Article 13)
  • right to property (Article 1 of the first protocol)
  • right to education (Article 2 of the first protocol)
  • right to free and fair elections (Article 3 of the first protocol)
  • abolition of the death penalty in peacetime (Articles 1 and 2 of the sixth protocol.

  Of these, articles 3 and 8 are particularly relevant

• Local Government Act 2000 amendedOpen

  s2 gives a local authority power to incur expenditure (including the provision of staff, goods, services or accommodation to any person), to give financial assistance to any person and to enter into arrangements, agreements or to facilitate or coordinate the activities of any person in order to promote or improve the social wellbeing of anyone affected by home closure. This power does not allow a local authority to do anything which they are not legally able to do, for instance, buying registered nurse nursing care, nor raising money (by precepts, borrowing or otherwise) to fund extra costs that responding to emergency homes closures might incur. Under s76, however, a local authority may be able to make payments to a local NHS provider towards expenditure it may incur in the connection with arrangements they have made for emergency provision of accommodation (for instance, the re-opening of a ward so that people displaced in an emergency can be accommodated). Further information can be obtained from the National Health Service (Payments by Local Authorities to NHS Bodies) Regulations 2000, under s2, s3(1) of the 1977 Act, and s25A-25H and s117 of the Mental Health Act 1983.

• Basic guidanceOpen

  Responsibility to assess, the legal framework
  The overarching duty on local authorities is set out in the NHS and Community Care Act 1990. NHS and Community Care Act 1990 Section 47(1) imposes a duty on local
  authorities to carry out an assessment of need for community care services with people who appear to them to need such services and then, having regard to that assessment, decide whether those needs call for the provision by them of services.

  NHS and Community Care Act 1990 Section 47(2) states that if, during the Section 47(1) assessment the person is identified as being 'disabled', that person has additional rights as set out in Section 47(2). This requires local authorities to make a decision as to the services required under Section 4 of the Disabled Persons (Services and Consultation and Representation) Act 1986.

  The Chronically Sick and Disabled Persons (CSDP) Act 1970 Section 2 places
  a duty on local Authorities to assess the individual needs of everyone who falls within Section 29 of the National Assistance Act 1948 above.

  Duty to arrange/provide services for people with Eligible Needs:
  The National Assistance Act 1948 Section 21(1) concerns the provision of
  residential accommodation to certain groups of people over 18 years who through age, illness, disability or any other circumstances are in need of care and attention which would otherwise be unavailable to them. The duty is owed to people 'ordinarily resident' in the Local Authority's area.

  It is made clear in National Assistance Act 1948 Section 29 that the local council has a duty to exercise its powers for people 'ordinarily resident' in its area and must provide:
  • a social work advice and support service
  • facilities for rehabilitation and adjustment to disability
  • facilities for occupational, social, cultural and recreational activities.

  Under the provisions of the Chronically Sick and Disabled Person's Act 1970 Section 1, a duty is imposedon local authorities to provide information about relevant services.

  The NHS and Community Care Act 1990 Section 47, para 1, states that an individual's 'financial circumstances should have no bearing on whether a council carries out a community care assessment' (Department of Health 2002b, p.14). In general, therefore, local authorities have a duty to carry out needs assessments for any person for whom it appears the council might provide or arrange community care services, including residential care, or who might be in need of such services.

  The National Minimum Standards, Care Homes for Older People ( DoH 2002)
  Standard 3 para 3.3 places a responsibility on the registered manager of the home to
  assess individuals who are self funding and do not have a care management assessment. The only duty for local authorities is to assess publicly-funded residents, however good practice would require assessment of both funded and self-funded residents subject to a home closure.

  The Mental Capacity Act 2005, sets out key principles applying to decisions
  and actions taken under the Act. The starting point is a presumption of mental capacity. A person must be assumed to have mental capacity until it is proved otherwise. A person must also be supported to make his/ her own decision, as far it is practicable to do so. The Act's definition of a person who lacks mental capacity focuses on the particular time when a decision has to be made and on the particular matter to which the decision relates, not on any theoretical ability to make decisions generally. It follows that a person can lack mental capacity for the purposes of the Act even if the loss of mental capacity is partial or temporary or if his mental capacity fluctuates

  The NHS and Community Care Act 1990 Section 47, para 3-6, allows local authorities to
  relocate residents without assessment where services are needed urgently.
  National Health Service Act 2006 / Local Authority Social Services Act 1970
  The NHS Continuing Healthcare (Responsibilities) Directions 2007 sets out the
  responsibilities of the NHS to fully fund individuals who have a primary health need and who meet the eligibility criteria for NHS funding.

  National Assistance Act 1948

  In general terms the National Assistance Act 1948 and the NHS and Community Care Act 1990 stipulate that local authorities discharge their responsibilities by:-

  • assessing individual needs
  • constructing a service specification and commissioning a service provider or agency to meet the assessed needs
  • formulating, monitoring and reviewing service contract arrangements;

  •    terminating contracts and placements or taking other enforcement/corrective actions;
  •    responding to complaints;
  •    local market management and development activities; and
  •    working reactively and proactively with service providers.