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Hay & Kilner oversees major judgment in care home dispute

05 Feb 2015

Leading North East based law firm, Hay & Kilner has successfully acted on behalf of a not for profit care home operator in a dispute over the level of fees local authorities should pay to meet the cost of care for its elderly residents.

The action was taken by Abbeyfield Newcastle Upon Tyne Society Limited, part of the nationwide Abbeyfield Society, amid claims the authority’s weekly payments to council-funded care home residents failed to meet the “actual cost” of caring for them.

Abbeyfield launched the case after Newcastle City Council announced in 2010 that it was freezing the weekly rates it was willing to pay to meet the cost of caring for care home residents. The Council was paying £436 per week from April 2009, and suggested a freeze at that rate from April 2010 initially for three years.

Mr Justice Norris ruled in favour of Abbeyfield and was trenchant in his remarks about the Council’s approach to setting rates.

Natasha Singarayer, Chief Executive of The Abbeyfield Society, commented:

“The Newcastle judgment brings the care funding issue into sharp focus.  From now on local authorities will find it much harder to get away with short-funding care beds.”

The Judge determined that the Council had not taken steps to inform itself of the actual costs of care and that the Council should pay a rate which he assessed as a reasonable rate under the User Agreement between the Council, the resident and Abbeyfield. The Judge ruled that the council should have paid a “reasonable rate” to Abbeyfield of £450 in 2010/11 and £460 in 2012/13.

Martin Soloman, Head of Commercial Disputes at Hay & Kilner and lead legal adviser for Abbeyfield commented:

We are very pleased to have been able to assist Abbeyfield and to have successfully obtained a supportive judgment.  We hope that judgment will have a much wider positive impact and improve the funding situation for the care of older people across the country.” 

For further information, please contact Martin Soloman or Lucy Gray

call: 0191 232 8345

Email: Lucy.Gray@hay-kilner.co.uk