Summary: Mrs X complains about the Council’s decision that Mrs Y deprived herself of assets to avoid paying care costs. She says this means Mrs Y has to pay unfairly. We find the Council is not at fault.

The complaint

1. The complainant, Mrs X, is a legal representative and complains on behalf of Ms Z and her mother Mrs Y. She says the Council wrongly decided Mrs Y deliberately deprived herself of her share of their property to avoid paying contributions to her care and support.
2. Ms Z would like the Council to recognise that Mrs Y did not deliberately deprive herself of her share of the property. The Council’s decision means that Mrs Y will unfairly pay for care costs.

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The Ombudsman’s role and powers

3. We cannot investigate late complaints unless we decide there are good reasons. Late complaints are when someone takes more than 12 months to complain to us about something a council has done. (Local Government Act 1974, sections 26B and 34D, as amended) We have exercised discretion to consider these matters as discussion has been ongoing
4. We investigate complaints of injustice caused by ‘maladministration’ and ‘service failure’. I have used the word ‘fault’ to refer to these. We cannot question whether an organisation’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
5. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

6. I considered information from the Complainant and from the Council.
7. I sent both parties a copy of my draft decision for comment and took account of the comments I received in response.

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What I found

Background

Charging

8. The Care Act, supported by the Care and Support Statutory Guidance, sets out how councils should work out how much service users should pay for services. Under those rules, service users with capital or income above upper limits have to meet the full costs of care services. The capital upper limit is £23,250.

Deprivation of capital

9. Paragraph 8.27 of the Statutory Guidance says:
10. “People with care and support needs are free to spend their income and assets as they see fit, including making gifts to friends and family. This is important for promoting their wellbeing and enabling them to live fulfilling and independent lives. However, it is also important that people pay their fair contribution towards their care and support costs”.
11. Annexe E to the Statutory Guidance says:
12. “People should be treated with dignity and respect and be able to spend the money they have saved as they wish – it is their money after all. [But]…it is important that people pay the contribution to their care costs that they are responsible for. This is important to the overall affordability of the care and support system. A local authority should therefore ensure that people are not rewarded for trying to avoid paying their assessed contribution.”
13. “Deprivation of assets means where a person has intentionally deprived or decreased their overall assets in order to reduce the amount they are charged towards their care. This means that they must have known that they needed care and support and have reduced their assets in order to reduce the contribution they are asked to make towards the cost of that care and support.”
14. Annexe E also says:
15. “There may be many reasons for a person depriving themselves of an asset. A local authority should therefore consider the following before deciding whether deprivation for the purpose of avoiding care and support charges has occurred:
1. whether avoiding the care and support charge was a significant motivation in the timing of the disposal of the asset; at the point the capital was disposed of could the person have a reasonable expectation of the need for care and support?
2. did the person have a reasonable expectation of needing to contribute to the cost of their eligible care needs?”
16. It would be unreasonable to decide a person had disposed of an asset in order to reduce the level of charges for their care and support needs if at the time the disposal took place they were fit and healthy and could not have foreseen the need for care and support at the time they disposed of the asset.
17. Where the council decides the person has deliberately tried to avoid paying for their care by depriving themselves of capital or income, it may charge the person as though they still have the capital or income.

What happened

18. Mr and Mrs Y lived in a property which they owned. When Mr Y died in 2012, Ms Z inherited his half share of the property on a life interest trust. This allowed for Mrs Y to live in the property and be responsible for the outgoings, maintaining and insuring the property. The terms set out that the life tenant “pays all outgoings and keeps the property in good repair and condition and insures it for its full replacement value”. Following Mr Y’s death, Mrs Y had several falls; Ms Z says this was due to her bereavement.
19. Ms Z says that at the end of 2014, Mrs Y could no longer cope with the responsibilities of owning the property. Mrs Y took legal advice and, in February 2015, signed over her half of the property to Ms Z. Ms Z was not present at the consultation and did not know about her plans until after this. She says there was no suggestion of avoiding care fees; Mrs Y was in good health and could not have foreseen that she would need care and support.
20. In February 2018, Mrs Y first had care needs identified. From August 2019, she received a care package of two calls a day. By March 2020, this was increased to four calls a day due to self neglect and reduced mobility. Mrs Y refused to accept care and had frequent falls. Her GP suspected early stage dementia.
21. In March 2020, Mrs Y fell and went to hospital and was transferred to a care home because of the risk of COVID-19. The placement became permanent and she moved into the nursing unit there. The Council assessed Mrs Y’s finances and decided she had deliberately deprived herself of capital in 2015 when she transferred her share of the property to Ms Z.
22. The Council considered Ms Z’s challenge to its decision. She said:
• During 2012-13, Mrs Y got caught by rogue traders and cold callers several times. She paid extortionate amounts for shoddy work and the callers stole items from the garage. She also replaced a fence that was her neighbour’s responsibility and the friend who did this work charged too much. Mrs Y also paid invoices wrongly, insured the property twice and ran up a huge debt with the water provider because she did not tell Ms Z about a dripping tap.
• Mrs Y could not cope with the responsibility of being a joint property owner. She transferred the property so she would no longer have the responsibility for the administration and other practical responsibilities. On transfer, Ms Z took over all day to day administrative responsibilities for the property.
• Mrs Y transferred the property to make life easier for Ms Z after Mrs Y’s death.
23. The Council said Mrs Y had previously been a joint property owner with Mr Y and had no problem with it then. She was also able to continue living at the property on her own. Mrs Y did have some duties towards Ms Z under the terms of the will trust but also had responsibilities as an occupier once she transferred her share. There was no written agreement between Ms Z and Mrs Y dealing with Mrs Y’s responsibilities as an occupier of Ms Z’s property. Ms Z already owned 50% of the property and did not need to own the other 50% to take over or assist Mrs Y with the administrative responsibilities. It said it must assume Mrs Y would have acted logically and rationally, but the transfer left Mrs Y with no security and increased Ms Z’s capital gains tax liability. The transfer benefitted neither Mrs Y, or Ms Z, in the way Ms Z suggested. It also said that the “reasonable expectation of needing to contribute to the cost of their eligible care needs” did not need to be in the immediate future.
24. The Council considered further various comments from Mrs X and Ms Z. However, it concluded that Mrs Y had deliberately deprived herself of the property for the purposes of avoiding care and support charges in the future.

Was there fault which caused injustice?

25. it is not our role to question a decision taken properly. There is no evidence to suggest there was fault in the way the Council dealt with the matter.
26. The key issue is not that Mrs Y transferred the property. She was entitled to do what she wished with her capital. But, having done so, the Council was entitled to investigate whether avoiding care costs was a significant motive in the reasons for doing this.
27. As set out in the guidance, the questions the Council must consider before deciding whether deprivation has occurred are:
1. Whether avoiding the care and support charge was a significant motivation in the timing of the disposal of the asset; at the point the capital was disposed of, could the person have a reasonable expectation of the need for care and support?
2. Did the person have a reasonable expectation of needing to contribute to the cost of their eligible care needs?
28. The Council has provided evidence of its consideration of these two questions. The evidence also shows the Council has considered, and addressed, the points put forward by Ms Z. This shows the Council has properly considered its decision as it has considered all relevant information.
29. I appreciate that Ms Z is disappointed with the Council’s decision that the transfer of Mrs Y’s share of the property amounted to a deprivation of assets. However, when a Council has made its decision properly, the Ombudsman cannot question the decision. Therefore, I find no fault with the Council’s decision.

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Final decision

30. I have completed my investigation and do not uphold Mrs X’s complaint. The Council was not at fault.

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Investigator's decision on behalf of the Ombudsman