Care proceedings, HRA damages & the Statutory Charge: New LAA Position Paper

Early this month, I wrote a short piece for Legal Action criticising the need for clarity on the application of the statutory charge in HRA damages claims parallel to care proceedings (see"Can't get no just satisfaction", June 2018, Legal Action).

At the time I was writing, the Court was preparing to give its judgment in Northamptonshire County Council & AW v Lord Chancellor [2018] EWHC 1628.  No substantive judgment was needed as a resolution was reached by the parties following a clarification by the LAA of its position on the statutory charge. The brief judgment incorporates a published position statement from the LAA, which should be read by anyone contemplating the statutory charge and HRA damages claims, whether in care proceedings or elsewhere.  

In short, the LAA position is as follows:

• If damages are pursued only in the HRA 1998 proceedings, and not within the care proceedings; and no costs are claimed in respect of the damages claim, the statutory charge will not be applied.  
• The key will be to keep both claims clearly distinct.  
• Where an indication is sought from the LAA on a settlement of a relevant HRA 1998 damages claim, undertakings will be sought that no costs will be pursued on the certificate in respect of the damages claim before confirmation that the statutory charge will not be pursued.

The LAA position may have clarified as early as January of this year but received little publicity.  As is clear from the judgment, the helpful position statement is now published to afford greater clarity and transparency (see [9]-[10] of the judgment).

Worth noting in the judgment is that the LAA has reviewed cases back to April 2017, with a view to identifying errors or unfairness due to the earlier lack of clarity: 

"The Legal Aid Agency has informed the Court when this Judgment was circulated in draft that it has undertaken a review of a number of other cases where this issue has arisen since April 2017 ('legacy' cases) in order to remedy any previous cases in which the statutory charge has wrongly been interpreted as applying in relation to damages awarded for breach of human rights. Obviously it would not be appropriate for me to make any comment in relation to those legacy cases other than to note that in cases which are similar to the instant case, obvious injustices should now be cured." (at [7]).

Some clients may have been contacted as part of this review. However, as the judge recognises, there are plainly injustices ripe for cure. Any recent negative advice given as a result of consideration of the charge, should now be revisited in the light of the new policy statement.

This issue has caused real difficulty since the change of practice by the LAA following the introduction of s.25 LASPO.  

Further guidance on just satisfaction, fair redress for the violation of individual rights and the statutory charge may be found as the Court of Appeal prepares to consider the latest round in Faulkner.  

Watch this space...