Council wrongly decided man deprived himself of assets for purpose of reducing care fees, Ombudsman finds

The man behind the complaint, Mr X, contended that the council wrongly decided his father, Mr Y, deprived himself of assets for the purpose of reducing his care fees. He said this meant Mr Y was required to pay for his care when he should not have been.

When undertaking or reviewing a financial assessment, a council may identify circumstances that suggest that a person may have deliberately deprived themselves of assets.

Deprivation of assets means a person has intentionally deprived or decreased their overall assets in order to reduce the amount they are charged towards their care.

Outlining the background to the case, the Ombudsman said Mr Y’s wife died in June 2016. Mr Y transferred the ownership of his home into “The Y Family Trust” in December 2016.

Mr Y, who has dementia, became a permanent resident of a care home in May 2024.

In June, the council sent a financial assessment decision to Mr X. The letter included consideration of the factors set out in the Care and Support Statutory Guidance.

In relation to the First Test, the council considered that:

• “At the time Mr Y gave away full control of his most valuable asset”, “he was 86 years old”, and;
• He had “diagnoses of hypertension and oesophagitis, which were managed by medication, as well as having had the onset of a cataract”.

Considering the Second Test, the council took into account that:
• “Adult social care has been means tested for many years. It has been a contentious issue and widely discussed in the public domain for decades […] It is well known that people have to pay for care and support if their assets are above a certain threshold or contribute to that provision”.
• “The obligation to pay for care is not just limited to people in receipt of residential care”.
• Before she died in 2016, Mrs Y had been involved with the social care system, and there was correspondence sent at the time regarding payment towards social care.

The council decided that the “significant motivation” for Mr Y gifting his property to his children was “deliberate deprivation” to avoid paying for care fees in the future.

Mr X appealed the decision in July, saying that his father’s motivation in creating the Trust was to ensure that the property was split equally between his four children on his death.

The council’s Decision-Making Panel considered Mr Y’s case in August and wrote to Mr X with its decision. It concluded that, at the time Mr Y created The Y Family Trust in December 2016, he had a reasonable expectation of needing care and support in future, had a reasonable expectation of needing to contribute to the cost of that care, and that the significant motivator for Mr Y creating the Trust was to avoid paying for care and support.

Mr X appealed again, but the council’s conclusions were broadly the same as in previous decisions.

Considering Mr X’s complaint, the Ombudsman said: “In this case, the council considered the circumstances of the case in line with the Care and Support Statutory Guidance. It considered the timing and motivation behind the creation of the Trust, whether Mr Y had a reasonable expectation of needing ongoing care and support, and whether he would have expected to contribute towards the cost of that care. It also reviewed the decision when asked to do so by Mr X. This was evidence of good administration.

“However, I find that the council did not consider all factors properly.”

The Ombudsman’s published guidance on deprivation of capital says: “The council should consider if the user of services ‘must have known that they needed care and support’. This will be a case specific judgment. For example, many people live with chronic long-term health conditions but may never need care and support. While others may have conditions that will degenerate and where it is anticipated such needs will arise.”

The report noted: “In this case, the council relied on the argument that a diagnosis of hypertension was sufficient [for] Mr Y to have expected, in 2016, to need care in the future.

The council said that untreated hypertension can increase the risk of developing a condition which could result in someone needing care and support, but also noted that Mr Y’s hypertension was being treated.

“If the medication Mr Y was taking controlled his hypertension adequately, he would not necessarily have been at higher risk of needing care than anyone else.”

The Ombudsman found the council did not appear to have explored the question of whether Mr Y’s hypertension was controlled at the time he created the Trust in December 2016.

The report concluded: “The council’s conclusion that a diagnosis of hypertension alone meant Mr Y would have had a reasonable expectation of needing care and support (the First Test) is not supported by all the evidence that was available to the council, and therefore is fault. That fault caused Mr X and his siblings an injustice in that the council’s conclusion was not robustly evidence-based.”

Lastly, the Ombudsman found fault with the council for referring, in its decisions of June and August, to Mr Y’s medical records after 2016, noting that these were “not relevant” to the decision Mr Y made to create a Trust in 2016.

To remedy the injustice caused, the council was recommended to arrange for Mr Y’s case to be reconsidered by its Revisit and Review Panel, taking account of the Ombudsman’s findings.

Councillor Angela Argenzio, Chair of the Adult Health and Social Care Committee at Sheffield City Council, said: “We take several factors into account when assessing whether someone has deprived themselves of assets. This is both a complex and specialist process, the outcome of which can vary on an individual basis. We will continue to ensure that we are always as thorough as possible when making decisions in such cases, which will include paying particular attention to providing detailed explanations to every individual. We will reflect on the findings of the Ombudsman and review processes as directed.”

Lottie Winson