Judge: Supreme Court (Hale, Wilson, Carnwath, Hughes and Toulson SCJJ)
Citation:  UKSC 46
This case concerned the ordinary residence of P, who has severe physical and learning disabilities and lacks the capacity to decide where to live. He lived with his parents in Wiltshire until he was four years old. At that time his parents asked Wiltshire Council to arrange his accommodation and P was placed with foster-carers in South Gloustershire, pursuant to section 20 of the Children Act 1989 (“CA 1989”). P lived with his foster-carers in South Gloustershire for the next 14 years, until he reached majority in 2004. After he turned 18 he lived with his former foster-carers for approximately one month before moving to live in two different care homes in Somerset.
P’s parents moved to Cornwall around the time that P was placed into foster-care but they remained closely involved in decisions affecting his care. They visited him four or five times a year and he occasionally went to stay with them in Cornwall.
The Secretary of State was asked to determine a dispute between Wiltshire, South Gloustershire and Cornwall as to P’s ordinary residence when he turned 18. The local authorities agreed that this was the relevant date because P’s need for accommodation under section 21 of the National Assistance Act 1948 (“NAA 1948”) arose on that date. Accommodation provided under section 21 was excluded from consideration for the purpose of determining ordinary residence by section 24(5) of the NAA 1948, which provided that “Where a person is provided with residential accommodation under this Part of this Act, he shall be deemed for the purposes of this Act to continue to be ordinarily resident in the area in which he was ordinarily resident immediately before the residential accommodation was provided for him.” A similar provision is found in section 105(6) of the CA 1989, which states that “In determining the ‘ordinary residence’ of a child for any purpose of this Act, there shall be disregarded any period in which he lives in any place … while he is being provided with accommodation by or on behalf of a local authority.”
The Secretary of State took into account the entirety of the relationship between P and his natural parents and determined that P’s ‘base’ and place of ordinary residence was with them in Cornwall when he turned 18. In doing so the Secretary of State applied his “Guidance on the Identification of the Ordinary Residence of People in Need of Community Care Services”, which set out two tests from R v Waltham Forest London Borough Council, ex Parte Vale (1985) Times 25 February. The first test in the Guidance from Vale, so-called “Test one”, treated a mentally disabled person in the same way as “a small child who was unable to choose where to live”, with the consequence that they have the same ordinary residence as their parent or guardian. The second test in the Guidance from Vale, “Test two”, involved considering a person’s ordinary residence as if they had capacity and provided that: “All the facts of the person’s case should be considered, including physical presence in a particular place and the nature and purpose of that presence …”
Beatson J upheld the Secretary of State’s determination and Cornwall appealed to the Court of Appeal. Elias LJ, with whom the rest of the Court of Appeal agreed, held that the Secretary of State had misdirected himself in law and that the first test in Vale ought not to be followed. He was critical of the use of the term ‘base’ and went on to say that, even if that was a helpful concept, Cornwall could not properly be so described as it was simply a place that P visited occasionally for holidays. Elias LJ also thought Wiltshire was out of the question as P had ceased to have any connection with it at all. He held that South Gloustershire was therefore the only conclusion properly open to the Secretary of State.
The majority of the Supreme Court disagreed. Lord Carnwath, with whom Lady Hale, Lord Hughes and Lord Toulson agreed, held that P was ordinarily resident in the area of Wiltshire. Lord Carnwath undertook a detailed review of the authorities on ordinary residence, including the leading modern authority on ordinary residence, R v Barnet LBC, Ex p Shah  AC 309, and In re P (GE) (An Infant)  Ch 568, the source of the word ‘base’ used in Vale and the Secretary of State’s guidance. Lord Carnwath considered that Lord Denning did not intend in that latter case to separate the idea of a base from a need for physical residence of some kind.
Lord Carnwath also reviewed the facts of Vale, where Taylor J was asked to decide the ordinary residence of a young woman, Judith, mentally incapable of forming a settled intention of where to live, who had been living in Ireland for 20 years and returned to live with her parents in England for a few weeks while a suitable residential placement was found for her. Taylor J held that the extent of her disabilities was such that she was totally dependent upon her parents: “She is in the same position as a small child. Her ordinary residence is that of her parents because that is her ‘base’ …” Taylor J went on to hold that if Judith was treated as if she had capacity, the same result would follow as her residence with her parents had all the attributes necessary to constitute ordinary residence.
Lord Carnwath was clear that Taylor J’s two approaches should not be treated as separate legal tests. He said (at para 47):
“[Taylor J’s two approaches] were complementary, common-sense approaches to the application of the Shah test to a person unable to make decisions for herself; that is, to the single question whether her period of actual residence with her parents was sufficiently “settled” to amount to ordinary residence.”
Lord Carnwath considered that under the language of the NAA 1948, “it is the residence of the subject, and the nature of that residence, which provide the essential criterion”. He went on to say (at para 51):
“In so far as Vale is relied on to substitute an alternative test, based on ‘the seat of (his) decision-making’, or otherwise on his relationship with his parents and their home, it depends on a misunderstanding of that judgment. The seat of the decision-making power in relation to a mentally disabled adult is the authority making the placement (subject to any contrary determination by the Court of Protection), not the parents. For the same reason, the weight put by the decision-maker on the so-called Vale tests 1 and 2, both in the guidance and in the decision-determination, was in my view misplaced.”
Having determined that P had not therefore been ordinarily resident in Cornwall, Lord Carnwath then examined the case for P to be ordinarily resident in either of the two remaining local authorities. He said that applying the Shah test without qualification it was easy to see why the Court of Appeal chose South Gloustershire, where P had lived happily for 14 years. Lord Carnwath was explicit about his reasons for rejecting this, despite it being the obvious answer (at paras 53-55):
“… [A]lthough the choice of South Gloucestershire may fit the language of the statute, it runs directly counter to its policy. The present residence in Somerset is ignored because there is no connection with that county other than a placement under the 1948 Act. By the same policy reasoning, South Gloucestershire’s case for exclusion would seem even stronger. There is no present connection of any kind with that county, the only connection being a historic placement under a statute which specifically excluded it from consideration as the place of ordinary residence for the purposes of that Act.
The question therefore arises whether, despite the broad similarity and obvious underlying purpose of these provisions (namely that an authority should not be able to export its responsibility for providing the necessary accommodation by exporting the person who is in need of it), there is a hiatus in the legislation such that a person who was placed by X in the area of Y under the 1989 Act, and remained until his 18th birthday ordinarily resident in the area of X under the 1989 Act, is to be regarded on reaching that age as ordinarily resident in the area of Y for the purposes of the 1948 Act, with the result that responsibility for his care as an adult is then transferred to Y as a result of X having arranged for his accommodation as a child in the area of Y.
It is highly undesirable that this should be so. It would run counter to the policy discernable in both Acts that the ordinary residence of a person provided with accommodation should not be affected for the purposes of an authority’s responsibilities by the location of that person’s placement. It would also have potentially adverse consequences. For some needy children with particular disabilities the most suitable placement may be outside the boundaries of their local authority, and the people who are cared for in some specialist settings may come from all over the country. It would be highly regrettable if those who provide specialist care under the auspices of a local authority were constrained in their willingness to receive children from the area of another authority through considerations of the long term financial burden which would potentially follow.”
Unlike the Court of Appeal, Lord Carnwath considered that comparable expressions, including ‘normal residence’ and ‘habitual residence’, were a doubtful guide.
Lord Carnwath held that the statutory context was critical in construing the relevant words in section 24 of the NAA 1948. In light of the purpose of the provision, which he considered concerned only the allocation of fiscal responsibility as between local authorities, it would be artificial to ignore the nature of P’s placement under the CA 1989, a parallel statutory context. Lord Carnwath said (at paras 59-60):
“… [I]t would be wrong to interpret section 24 of the 1948 Act so as to regard PH as having been ordinarily resident in South Gloucestershire by reason of a form of residence whose legal characteristics are to be found in the provisions of the 1989 Act. Since one of the characteristics of that placement is that it did not affect his ordinary residence under the statutory scheme, it would create an unnecessary and avoidable mismatch to treat the placement as having had that effect when it came to the transition in his care arrangements on his 18th birthday.
On this analysis it follows that PH’s placement in South Gloucestershire by Wiltshire is not to be regarded as bringing about a change in his ordinary residence. Throughout the period until he reached 18 he remained continuously where he was placed by Wiltshire, under an arrangement made and paid for by them. For fiscal and administrative purposes his ordinary residence continued to be in their area, regardless of where they determined that he should live.”
In his dissenting judgment Lord Wilson agreed with the Court of Appeal. He acknowledged the strong reasons of public policy which militated in favour of the conclusion reached by the majority. At the same time, he was clear that this was not the result which the law, as it stands, compels, saying “I am not a legislator. Nor, with respect, are my colleagues.”
The conclusion that P was ordinarily resident in the area of Wiltshire is likely to have far-reaching consequences for the law governing ordinary residence. It is fair to say that it came as a great surprise. As Lord Wilson pointed out in his dissenting judgment, it is a conclusion for which no party had contended at any stage of the proceedings.
The case is extremely important for anyone practising in this field. Many will applaud, in particular, Lord Carnwath’s rejection of a separate, paternalistic Vale test for those who lack the capacity to decide where to live. Unfortunately for those who practise in this area, Lord Carnwath’s judgment opens up almost as many questions as it answers. It seems highly likely that policy reasons articulated by Lord Carnwath for applying the deeming provisions contained in the CA 1989 when determining ordinary residence for the purpose of the NAA 1948 would apply equally when interpreting ordinary residence in the Care Act 2014. This suggests that considerable caution should be exercised when relying on the commentary on ordinary residence in the Care and Support Statutory Guidance, which was written following the judgment of the Court of Appeal.
Questions also arise about the interpretation of ordinary residence in other statutory contexts. It seems likely, for instance, that the deeming provisions in the CA 1989 would also apply when determining ordinary residence and therefore responsibility for providing after-care services to a young person under section 117 of the Mental Health Act 1983, but definitive resolution of such issues will await further case law. This may well be some time coming, given how infrequently ordinary residence issues reach the courts.