Personal Injury Trusts and Public Funding of Care

In R (on the application of CGT) v West Sussex CC [2026] EWHC 293 (Admin), the court considered again the question of whether the beneficiary of a personal injury trust could be prevented from claiming public funding for care.

Under the Care Act 2014, a local authority has a duty to assess the care needs of an adult resident and then to fund those needs if the resident’s capital resources are below a given limit. Regulations provide that sums held under a personal injury trust are to be disregarded when considering the resources.

The claimant (“C”) was born in 1994 and sustained a severe brain injury at age 3 months. He is now an adult living in supported accommodation and in need of day-to-day care and support. In 2011, C’s mother was appointed as C’s property and affairs deputy. In 2012, the Criminal Injuries Compensation Authority (“CICA”) made an award of over £3.5m to be paid into a personal injury trust for C’s benefit. The award required C’s mother to give certain undertakings aimed at precluding applications for public funding for C’s care unless the award for future care had been exhausted or there was some other particular reason and an order was to be sought from the Court of Protection (“COP”) restricting the mother’s powers as deputy accordingly.

Before any such order was made, however, C’s mother died. C’s father was made deputy and the appointment contained no restrictions on his ability to seek public funds for C’s care. The local authority was then asked to assess C’s care needs and contribute to the cost of the residential care placement. The local authority began to make payments but reserved its position as to whether it was obliged to do so. It applied to the COP to have the terms of the deputyship varied to introduce a restriction of the right to apply for public funding for care as envisaged by the CICA. The COP dismissed the application. The local authority then wrote refusing further assistance and reclaiming moneys paid to date. Its position was that the CICA award covered future care costs, it had not been exhausted, and it should be used to pay for care. It asserted that there would be double recovery if the local authority paid for care as well. It noted that in Tinsley the court had emphasised that it would prevent double recovery. The decision was challenged by way of judicial review.

The local authority contended:

1. The regulations should be construed purposively and should disregard capital payments specifically made for future care, so that C should not be allowed to benefit from the current deputy resiling from the agreement made when the CICA made the award.
2. Alternatively, the same result should be reached by a discretionary refusal to grant relief on the basis that granting relief would lead to double recovery which the court should actively intervene to prevent (as suggested in WNA v DNP).

After review of the authorities, the judge rejected the local authority’s case. The words of the regulations were “clear, unambiguous and unqualified” (§57). The sums in the trust fund were excluded from the assessment of capital. The local authority’s refusal to entertain the application for funding was unlawful. As to withholding relief as a matter of discretion, the judge noted that any principle to avoid double recovery was one to be applied by the court assessing damages. The judge was not persuaded that payments made by the local authority would be a mere windfall for C. In any event the regulations spell out for the local authority the proper approach to assessing relevant capital. The local authority had in effect refused to follow those rules. It was not an appropriate case to exercise discretion on its behalf.

The decision makes clear that the question of double recovery is one for the court assessing the damages. As was said in Tinsley and in Crofton, if it is clear at trial that a claimant will rely on local authority provision in the future then damages will not be awarded for that element of the claim.  However, that does not lead to the result which the local authority contended for in CGT, namely that a local authority could in effect ignore the express wording of the regulations simply because it viewed the literal application of the regulations as leading to double recovery.