Factual and Procedural Background
An individual (“Individual”) born in 1986 has profound physical and learning disabilities and lacks capacity to decide where to live. In 1991 Authority A placed Individual with specialist foster carers in Authority C under the Children Act 1989 after the family sought assistance. Later that year the family home moved to Authority B, although the foster placement in Authority C continued for some 14 years.
Approaching adulthood, Authority A began transition planning. On turning eighteen (27 December 2004) Individual remained temporarily with the foster family before moving, on 24 January 2005, to a residential care home in Authority D. Costs were met provisionally by Authority A under the National Assistance Act 1948 (“1948 Act”).
The three local authorities (Authorities A, B and C) could not agree who was financially responsible. They jointly referred the dispute to the Secretary of State under s 32(3) of the 1948 Act. On 22 March 2012 the Secretary of State decided that Individual had been “ordinarily resident” in Authority B immediately before the adult placement, making Authority B liable.
Authority B brought judicial review. The High Court (Judge C) upheld the Secretary of State, but the Court of Appeal (Judge D) reversed the decision, holding Authority C responsible. The Secretary of State and Authority D appealed to the Supreme Court. Authorities A and C supported the appeals; Authority B opposed and additionally challenged the Secretary of State’s jurisdiction.
Legal Issues Presented
- Which local authority bears the statutory duty under ss 21–24 of the 1948 Act to provide and fund Individual’s residential accommodation and support.
- Whether the Secretary of State had jurisdiction under s 32(3) of the 1948 Act to determine “ordinary residence” when, according to Authority B, no duty had yet arisen under s 21.
- How “ordinary residence” should be identified for an adult lacking capacity who had been placed out-of-area as a child, including the relevance of the so-called “Vale tests” and the effect of deeming provisions in the 1948 and 1989 Acts.
Arguments of the Parties
Appellants’ Arguments (Secretary of State & Authority D)
- The Secretary of State had jurisdiction because the dispute needed resolution to ensure a seamless transition to adult services.
- Under s 24(5) of the 1948 Act Individual remained “ordinarily resident” where he was resident immediately before adult accommodation was provided, i.e., Authority A; the placement in Authority C should be ignored for allocation purposes.
- The Court of Appeal misapplied Ex p Vale and ignored statutory policy that a placing authority cannot shed responsibility by out-of-area placements.
Respondent’s Arguments (Authority B)
- The Secretary of State lacked jurisdiction because any needs could still be met under the leaving-care provisions of the Children Act 1989; thus no question under Part III of the 1948 Act had arisen.
- If jurisdiction existed, Individual’s ordinary residence on 26 December 2004 was in Authority C where he had lived for 14 years.
- Authority A could not rely on s 21 of the 1948 Act because its powers under the Children Act remained sufficient.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Precedent 1 (1983 AC 309) |
Defines “ordinary residence” as residence adopted voluntarily and for settled purposes. |
Starting point for analysing where Individual was ordinarily resident. |
| Precedent 2 (1985, unreported) |
“Vale tests” for persons lacking capacity. |
Court held guidance put undue weight on these tests; they are not standalone rules. |
| Precedent 3 (2002 1 AC 547) |
Emphasises factual residence (“eat and sleep” test). |
Cited by Court of Appeal; Supreme Court distinguished on policy grounds. |
| Precedent 4 (2014 AC 1) |
Approach to habitual residence—integration into social/family environment. |
Referred to but found not determinative for 1948 Act context. |
| Precedent 5 (2011 PTSR 1623) |
Section 24(5) is self-contained deeming provision. |
Supreme Court distinguished; deemed residence relevant across both Acts. |
| Precedent 6 (1928 AC 217) |
Continuity of residence concept. |
Supports classic definition of ordinary residence. |
| Precedent 7 (1928 AC 234) |
Residence for settled purposes need not be exclusive. |
Forms part of classic test adopted. |
| Precedent 8 ((1904) 5 Tax Cas 101) |
Possibility of multiple ordinary residences. |
Cited historically; not decisive here because only one authority can be liable. |
| Precedent 9 (1965 Ch 568) |
Concept of a child’s “base.” |
Court found reliance on “base” terminology unhelpful in this context. |
Court's Reasoning and Analysis
Preliminary issues: Judge A rejected Authority B’s jurisdictional challenge, holding that s 32 should be read purposively: resolving responsibility ahead of time ensures uninterrupted care. Section 21 and leaving-care powers serve different purposes; overlap does not oust the 1948 Act.
Interpretation of “ordinary residence”: The Court held that the statutory scheme is administrative and fiscal; residence must be determined in a way that prevents authorities from off-loading responsibility by moving a vulnerable person. The foster placement in Authority C existed solely because Authority A exercised its childcare duties. Because s 105(6)(c) of the 1989 Act required that placement to be ignored for 1989 Act purposes, it would be illogical to treat it differently when transitioning to adult care.
Re-assessment of the Secretary of State’s original reasoning: The Secretary of State erred in analysing Individual’s relationships (“base”) rather than the legal effect of the foster placement. Nonetheless, once the proper test is applied, only one lawful answer emerges.
Application: Individual remained ordinarily resident in Authority A immediately before adult accommodation commenced. The deeming provision in s 24(5) fixed that residence for all adult-care purposes, irrespective of geographic location of the foster home or subsequent adult placements.
Dissent: Judge B considered that ordinary residence should reflect factual integration; on that approach, Authority C—where Individual had lived and was content—was responsible. Judge B warned against courts re-writing statutory policy.
Holding and Implications
Holding: The appeals are ALLOWED; the declaration that Authority C is responsible is set aside and replaced with a declaration that Authority A is responsible for Individual’s accommodation and care under the 1948 Act.
Implications: The judgment confirms that, when a child lacking capacity is placed out-of-area, the placing authority remains financially and administratively responsible after the child turns eighteen. The decision limits the independent role of the “Vale tests,” emphasises continuity of responsibility, and seeks to prevent strategic “export” of high-cost care obligations between local authorities. No new cause of action is created, but existing guidance may require revision to align with the Court’s analysis.