COMPANION CARE (WITNEY) LIMITED

  v  

COMMISSION for SOCIAL CARE INSPECTION

Application Number: 0263.EA

Appeal against a decision of the Commission for Social Care Inspection dated and served on the 13th January 2004 whereby the registration of the Appellant under Part 11 of the Care Standards Act 2000 as registered provider of a Domiciliary Care Agency was refused on the ground that pursuant to Regulation 7(4)(b) of the Domiciliary Care Agencies Regulations the Appellant should not carry on the agency if it had made a composition or arrangement with its creditors and the Appellant was the subject of a  Creditors Voluntary Arrangement   

Representation

The Commission was represented by Stephen Janisch, a solicitor

The Appellant was represented by Ms Rhoda Hedges

The Application

The matter was listed on 4th May 2004 both parties having requested a Preliminary Hearing. On the 30th April 2004 the Commission gave notice of the intention to ask the Tribunal to strike out the Appeal on the grounds that it was misconceived and had no prospect of success. I have had the benefit of considering the application and response. For the purposes of this hearing there is no dispute as to fact. I have also heard both parties.

Decision

The Appeal is struck out

Background

1.	The Appellant limited company was engaged in the provision of care agency services from late 2000 or early 2001. The company became liable to register under Section 12 in Part 11 of the Care Standards Act 2000 on 1st April 2003. As a pre existing provider the company was able to make application to register during a period from 31st March 2002 until 31st March 2003 and if such application had been received during that period the company would have been permitted to continue to provide care agency services after 1st April 2003 pending determination of the application pursuant to Commencement Order SI 2001 3852. In fact the application to register was made on 11th April 2003 and received by the Respondents on the 14th April. No point is taken by the Respondents consequent upon the late submission of the application.

2.	The application was submitted on behalf of the appellant company on 11th April 2003 and on the 30th April 2003 the company held a Creditors Meeting at which agreement was reached with the creditors. A Creditors Voluntary Arrangement supervised by an insolvency practitioner was entered. From that time the Appellant was in breach of Regulation 7(4)(b) of the Domiciliary Care Agencies Regulations 2002 “ A person shall not carry on an agency if……..he has made a composition or arrangement with hid creditors and has not been discharged in respect of it”. It is accepted by Ms Hedges that if the Appellant’s application had been determined by 30th April any registration would have been revoked.  In the event the Respondents were not immediately aware of the Creditors Voluntary Arrangement.

3.	The Respondents put in hand the enquiries necessary to determine the application for registration. Those enquiries became complex. It was found that the appellant company was linked to another limited company with a similar name which was a registered charity and the subject of investigations by  the Charity Commission. There were suggestions that there were close financial links and some irregularities. Those matters are relevant only to explain why it took some months to determine an application made in April 2003. I make no findings about them. In the meantime the appellant company continued to trade subject to the provisions of the Creditors Voluntary Arrangement providing the care agency services.

4.	At an interview designed to assess the fitness of the applicant which took place on the 25th November 2003 the situation with regard to the Appellant company became apparent to the Respondents. Ms Hedges was told that the company could not be registered because of the provisions of Regulation 7(4)(b) set out above. Clearly the Appellant company could no longer continue to provide care agency services. Ms Hedges states that this was a cause of great distress that was not handled sympathetically. Again these are not matters that are the subject of consideration in this Tribunal. The effect was that Social Services moved immediately to take matters over and the Appellant company was deprived of its only source of income.

5.	Under the provisions of the Creditors Voluntary Arrangement no Petition to wind up the Appellant company could be lodged until 3 months after the first default under the Creditors Voluntary Arrangement. Default occurred almost immediately after the interview on 25th November and the intervention of Social Services. The Appellant company was wound up in March 2004.

6.	Notice of Refusal of Registration was served on 13th January 2004 on the grounds, amongst other matters, that registration was precluded by Regulation 7(4)(b) of the Domiciliary Care Agencies Regulations 2002. Ms Hedges on behalf of the Appellant company lodged Notice of Appeal to the Tribunal on 18th January 2004.

Submissions

1	The Respondents make two submissions in support of their contention that the appeal should be struck out. First they contend that the Appellant ceased to exist when wound up and there is, in consequence, no Appellant able to pursue this appeal. It is fair to point out that the appeal has been pursued by Ms Hedges not by a liquidator and Ms Hedges accepted that there was no longer an Appellant to whom a registration could be granted. Second the Respondents contend that in any event the fact of the Creditors Voluntary Arrangement is established and the provisions of Regulation 7(4)(b) of the Domiciliary Care Agencies Regulations 2002 are mandatory with the result that an appeal simply could not succeed. 

2	Ms Hedges submits that whilst it is true that there was a Creditors Voluntary Arrangement it was not in place on the date that the application for registration was made and should not, therefore, have been taken into account when considering that application. She believed that the provisions of Regulation 7(4)(b) of the Domiciliary Care Agencies Regulations 2002 could only apply if the situation arose prior to the application. Of course she accepted that if the application had been granted the day it was made it would have been revoked 3 weeks later. She did not consider that she should have notified the Respondents of the change in circumstances even though the application remained outstanding and the prohibition in Regulation 7(4)(b) was  “A person shall not carry on an agency” clearly indicating that the prohibition extended throughout any period not simply the date of application.

Conclusions

1.	I accept that this appeal is misconceived and doomed to failure.

2.	There is no Appellant now that the Appellant company has been wound up. Once the Appellant company ceased to exist there was no basis upon which Ms Hedges could continue to pursue an appeal on its behalf.

3.	It is clear that the application had not been granted by the 30th April 2003 when the company entered the Creditors Voluntary Arrangement and that was a bar to the grant of registration under Regulation 7(4)(b). The provision is mandatory and whilst the company remained the subject of a Creditors Voluntary Arrangement, which continued until it was wound up in March 2004, no registration was possible.   

Judge David Swift
Acting President
5th May 2004