Summary: There was fault in the way the Council applied the section 117 process which caused significant financial injustice to the late Mrs X and as a result to her family through the loss to her estate. The Council has put in place training to improve the knowledge of this legislation and accepts it should repay the care home fees incorrectly incurred.

The complaint

1. Mr K (the complainant) says the Council gave him inaccurate information about his late grandmother’s eligibility for section 117 funding and as a result the family sold her home to pay for care home fees.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. 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(1), as amended)

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How I considered this complaint

4. I considered evidence provided by Mr K and the Council as well as relevant law, policy and guidance.
5. Mr K and the Council had an opportunity to comment on my draft decision. I considered their comments before making a final decision.

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What I found

Relevant law and guidance

6. Anyone who may have a need for community care services is entitled to a social care assessment when they are discharged from hospital to establish what services they might need. Section 117 of the Mental Health Act imposes a duty on health and social services to meet the health/social care needs arising from or related to the person’s mental disorder for patients who have been detained under specific sections of the Mental Health Act (e.g. Section 3). Aftercare services provided in relation to the person’s mental disorder under S117 cannot be charged for. This is known as section 117 aftercare.
7. Section 117 aftercare services must:

• meet a need arising from or related to the mental disorder for which the person was detained; and
• have the purpose of reducing the risk of the person’s mental condition worsening and the person returning to hospital for treatment for the mental disorder.

8. The “Mental Health Act 1983: Code of Practice” (the Code) is statutory guidance. This means that councils and ICBs must follow it, unless there are good reasons not to. The Code says that section 117 aftercare can include accommodation and continues as long as the person needs these services. Accommodation can generally only be part of section 117 aftercare if:

• the need is for enhanced specialised accommodation (“accommodation plus”);
• the need for the accommodation arises from, or is related to, the reason the person was detained in the first place (“the original condition”); and
• the “accommodation plus” reduces the risk of the person’s mental health condition worsening and the likelihood of the person returning to hospital for treatment for mental disorder.

Councils and ICBs must keep a record of the people for whom they provide aftercare services and what those services are

What happened

9. Mr K is the late Mrs X’s grandson and held power of attorney for the health and welfare and finances while she was alive.
10. In 2020 Mrs X was detained in hospital under section 3 of the Mental Health Act for a while. On discharge from hospital the Council says it wrote to her explaining that she would be eligible for s117 aftercare funding for homecare services. Mrs X declined the services. Her family have not seen that letter.
11. In 2024 Mrs X was admitted to hospital after a fall at home. On discharge on 21 March 2024, she was placed by the Council in care home A and her family was told her care there would be fully funded. The Council’s records note the initial funding of the placement on a short stay basis and describe conversations with the family who were unclear about the funding basis for Mrs K. The family were asked to complete a financial assessment.
12. The Council ceased finding Mrs X’s placement on 23 April 2024 and told the family the placement would be privately funded from then on. Mr K says he was told that because Mrs X owned her own home she would have to fund her own care. In June the welfare information officer emailed Mrs X to say “The financial assessment team have determined that you are full cost privately funded client with no financial support from the council.”
13. Mr K says as a result the family took the decision to sell the house and move Mrs X to care home B which would be closer for family to visit. The Council’s records say Mr K was angry the Council had initially placed Mrs X in such an expensive home so far from her family.
14. In March 2025 a new social worker considered Mrs X’s case and noted that she was eligible for s117 aftercare funding. The Council’s records show he contacted the finance officer who wrote to Mr K explaining that Mrs X’s contribution towards the cost of her care was nil. Mr K emailed to ask how he would get the fees already paid refunded. He added, “It's also disappointing that this has come to light. You might not know but we asked for her funding to be paid for and the last social worker said she was not eligible. Because of this, we have had to sell her house and incurred fees way in excess of her care”.
15. Notes on the Council’s files show Mrs X’s s117 status had not been included on her record. Officers subsequently discussed her eligibility and in April 2025 Mrs X was reassessed by a different social worker who said she did not meet the criteria for s117 eligibility.
16. There were further discussions with Mr K and his family raising the possibility that Mrs X had not been entitled to s117 aftercare funding for a residential or nursing placement, only for the home care services which she had declined.

The complaint

17. In April 2025 Mr K complained to the Council about the way they had been misled in respect of the funding for Mrs X’s care. He said the financial impact of the errors on her estate had been considerable.
18. Mrs X died on 22 April.
19. The head of service wrote to Mr K on 13 May about his complaint. He said “I am informed that there was a CPA discharge planning meeting [in 2020] whereby the S117 was explained as applying to homecare services. These services were offered to (Mrs X) but were declined by her at the time. The S117 was in place to help with the health matters of paranoia and hallucinations and that this was outlined in the S117 documentation. As such this did not extend to older adult frailty care, the type of care that (Mrs X) received in the two subsequent care homes. It is our understanding therefore, that the outcome regarding financial support for S117 would not be attached to the care package for (Mrs X) in these circumstances”.
20. Mr K complained to the Ombudsman.
21. The Council now says it believes its views on (Mrs X)’s care needs “should have been more holistic and taken into account older age frailty related needs as well as needs that were more in line with her mental health condition. It is not unusual for our services to offer jointly funded care packages or placements, and it is now my view that this should have been considered earlier in the client’s journey with our teams.” It accepts it failed to review Mrs X’s ongoing needs in respect of the s117 assessment. It notes there was a care needs and s117 review planned, as a result of the dispute, in 2025 but sadly Mrs X died before that could take place. It also notes that the Panel discussing the funding for Mrs X’s placement in 2024 does not appear to have been aware of her s117 status, which might have led to a different outcome then.
22. As a result of its investigation of the complaint, and identifying that there is insufficient knowledge about s117, the Council has committed to putting in place in-person training over the summer of 2026.
23. The Council also recognises that its paperwork needs to have S117 references in a more prominent position that both shows a s117 status as well as clearly rules it out, to avoid the issues which have arisen here where there was a lack of awareness for some years about Mrs X’s s117 status
24. Finally, the Council says it recognises it should repay the family for the care home fees incurred as a result of its errors and miscommunication.

Analysis

25. There was a failure on the part of the Council to identify and review Mrs X’s s117 status which led to confusion for her family and specifically to actions which would not have taken place otherwise. As a result of the misinformation the family sold Mrs X’s house to pay for her care home fees.
26. In addition the Council’s initial response to the complaint in 2025 took a limited view of the aftercare funding and sought to attach it too specifically to the period immediately after her discharge in 2020. That was unhelpful to her family and caused further confusion.
27. The Council accepts that there was a lack of documented evidence about Mrs X’s s117 needs over the period 2020 – 2025. Had that been available, it would have been possible to consider her status at each point when her care needs changed. That did not happen.

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Action

28. The Council has already taken steps towards rectifying the lack of knowledge around s117 processes and should provide us with details of the training undertaken in due course.
29. Mrs X has now died and the injustice she suffered cannot be remedied.
30. However, where there is clear evidence of a quantifiable financial loss arising from fault, we normally recommend a financial remedy that repays that loss to the deceased person’s estate. Here Mrs X paid care home fees which should have been funded through s117 aftercare funding. Within one month of my final decision the Council will repay the care home fees incurred.
31. Also within one month of my final decision the Council will pay interest (calculated at the base rate) on the amount it should have paid - £75,000, the care home fees from April 2024 - but was instead paid by Mr K
32. Finally, within one month of my final decision the Council will offer a payment of £500 to Mr K in recognition of the distress and frustration caused by the way in which it has acted.
33. The Council should provide us with evidence it has complied with the above actions.

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Decision

34. I have completed this investigation. I find fault causing injustice, which will be remedied by completion of the recommendations at paragraphs 28 to 31 above.

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Investigator's decision on behalf of the Ombudsman