R(IS) 2/91

Mr. A. T. Hoolahan	CIS/149/1989
13.8.90 	

Applicable amount – claimant living in nursing home – owned and run by her daughter – whether accommodation and meals provided by a close relative
The claimant was admitted in August 1988 to a nursing home owned by his daughter, and a claim for income support was made on his behalf.  The adjudication officer decided that he was not to be treated as resident in a nursing home because his accommodation and meals were provided by a close relative.  The claimant appealed.  The tribunal allowed the appeal on the grounds that although the daughter was the proprietor of the home she was not herself providing the accommodation and meals; and that the latter were provided on a commercial basis.  The adjudication officer appealed to a Social Security Commissioner.
Held that:
1.	even though a claimant may live in a nursing home on a commercial basis, if his accommodation and meals are provided in whole or in part by a close relative regulation 19 of the Income Support (General) Regulations does not apply.  He cannot be treated as a resident in a nursing home for income support purposes (para. 8);
2.	the term “provided” in paragraph 14 of Schedule 4 to the General Regulations may be taken as meaning “made available” (para. 8);
3.	the proprietor of a nursing home “provides” accommodation and meals to its residents. Even if living elsewhere and employing staff to care for the residents, the proprietor is ultimately responsible for running the home, and “makes available” the accommodation and meals to those residents.  If, therefore, the proprietor is a close relative, paragraph 14 of Schedule 4 applies (para. 11).
The appeal was allowed.

DECISION OF THE SOCIAL SECURITY COMMISSIONER
1.	I allow this appeal by the adjudication officer. The decision of the social security appeal tribunal dated 12 January 1989 was erroneous in law and I set it aside. I give the decision which I consider the tribunal should have given: section 101(5)(a)(i) of the Social Security Act 1975. My decision is that from the prescribed pay day Monday in week commencing 22 August 1988 the claimant was entitled to income support on the basis that he was not to be treated as a person resident in a nursing home because his accommodation and meals were provided by a close relative.
2.	The claimant, who has unfortunately since died but whom I shall continue to call “the claimant”, was a married man aged, at the date of the claim, 87 who until August 1988 was living with his wife in their own property in London. He suffered a stroke which left him partially paralysed on the right side and he lost his speech. He also broke his left leg. Accordingly, in August 1988 he moved to a nursing home in Plymouth owned by his daughter. On 17 August 1988 a claim for income support was made on his behalf at Plymouth. His daughter was appointed to act for him.  By a decision issued on 28 October 1988 the adjudication officer decided that the claimant was entitled to income support of £11.84 per week payable from the prescribed pay day Monday in week commencing 22 August 1988 and that he was not to be treated as a person resident in a nursing home because his accommodation and meals were provided by a close relative. The claimant appealed.  On 24 January 1989 the social security appeal tribunal allowed the appeal. The adjudication officer appeals with leave of another Commissioner.
3.	On 19 July 1990 I held an oral hearing. The adjudication officer was represented by Mr. Sayer of the Chief Adjudication Officer’s office. The claimant was represented by his daughter. I am grateful to them for their attendance and submissions.
The law
4.	Regulation 19(1) of the Income Support (General) Regulations provides:
“19. (1)	Subject to regulation 22 (reduction of applicable amounts) where ‑ 
(a)	the claimant lives in a residential care or nursing home; or
(b)	[not relevant],
his weekly applicable amount shall, except in a case to which regulation 21 (applicable amounts in special cases) or Part II of Schedule 4 (persons to whom regulation 19 does not apply) applies, be calculated in accordance with Part I of that Schedule.”
Part II of Schedule 4 is headed “Persons to whom regulation 19 does not apply” and paragraph 14 is in the following terms:
“14.	A claimant or, if he is a member of a family, the claimant and the members of his family where the accommodation and meals (if any) of the claimant or, as the case may be; the claimant and the members of his family are provided in whole or in part by a close relative of his or of any member of his family, or other than on a commercial basis.”
Paragraph 14 therefore, sets out two alternative situations in which regulation 19 does not apply. First, regulation 19 does not apply:
“where the accommodation and meals (if any) of the claimant . . . all provided in whole or in part by a close relative of his.”
Secondly, regulation 19 does not apply:
“where the accommodation and meals (if any) of the claimant . . . are provided 
. . . other than on a commercial basis.”
Tribunal decision
5.	In their findings of fact in form AT3, box 2 the appeal tribunal stated:
“The claimant was residing in The . . . Nursing Home, Plymouth as a commercial patient in the same way [as] the other 20 patients at that nursing home. His accommodation and meals were being provided by the nursing home on a commercial and business basis. His daughter . . . was the proprietor of the business, but was not herself as a close relative providing his accommodation or meals. The claimant himself was paralysed and had to be in a nursing home or hospital. The commercial business of the nursing home was not making money, and when [the daughter] had agreed to take her father as a patient of her business it was on a commercial basis for which she needed to be paid as with all other patients, since her business was not making money and she was heavily mortgaged to the Bank. [The daughter] as the daughter of the claimant lived in entirely separate accommodation, and in view of his condition could not possibly look after him personally since it was essential that he was in a nursing home because of his stroke and paralysis and of necessity he had to be looked after by qualified nursing staff and thus had to be in a nursing home.”
6.	In their reasons for their decision in form AT3, box 4 they stated:
“The claimant is a patient on a commercial basis in a nursing home. The nursing home is a business, and has to be run on business lines. The business is owned by the claimant’s daughter but is losing money at present. The claimant’s daughter could only take her father into that particular nursing home (and the nursing home is essential for him as is nursing care) in the same way that any other patient would be taken i.e. on a commercial basis. Thus, on the facts, the claimant was not having accommodation and meals provided in whole or in part by a close relative and his residency in the nursing home is on a commercial basis. The tribunal particularly noted the wording of regulation 14, which ended with the specific rider ‘or other than on a commercial basis’, and thus paragraph 14 relates to a situation which is not on a commercial basis which this particular case is.”
7.	The appeal tribunal have set out their findings of fact and their reasons very clearly.  They found as a fact that the accommodation and meals were provided for the claimant on a commercial basis and that regulation 19 applied and that the claimant was therefore entitled to income support as a resident in a nursing home. The appeal tribunal expressly found that the claimant’s daughter was the proprietor of the business “but was not herself as a close relative providing his accommodation or meals”. In my judgment the decision of the appeal tribunal was erroneous in law.
8.	The nursing home is run by the claimant’s daughter as a business. She is the sole proprietor. There can be no doubt that her father was living at the nursing home on a commercial basis. But, as I have sought to point out above, even though he was living there on a commercial basis, if his accommodation and meals were provided in whole or in part by a close relative, regulation 19 would not apply and he would not be entitled to income support as a resident in a nursing home. The claimant’s daughter (whose mother tongue is French) eloquently argued at the oral hearing that she did not “provide” the accommodation and meals for her father. The accommodation and meals were provided by the staff. She appointed the matron and the manageress who each employed their own respective staff and she left the running of the nursing home to them. She did not live at the nursing home the premises were heavily mortgaged to the Bank and at the date of the claim the business was running at a loss. When I asked her who provided the accommodation and meals, she answered “the Home” meaning, as I understood it, the manageress and her staff. The claimant’s daughter, however, agreed with Mr. Sayer that the word “provided” in paragraph 14 meant “made available”.
9.	I have, as was agreed at the oral hearing, done further research on the point since the hearing and I refer to the decision of the Commissioner in CSB/434/1984 where the Commissioner considered the point now, being taken by the claimant’s daughter. At paragraph 20 of his decision he said: 
“20. Moreover, and in regard to Mr. D’Eca’s submission [on behalf of the adjudication officer] as to it being the practical mechanics of ‘providing’ which the legislature must be presumed to have in mind, Mr. D’Eca himself was minded to accept that, as in my judgment is clearly so, it is in the case of a commercial boarding house the proprietor of the establishment who is to be regarded as ‘providing’ the accommodation and meals to lodgers there notwithstanding that the actual work involved in the day‑to‑day provision is performed by employees of the proprietor. This recognition enabled Mr. D’Eca to avoid an otherwise absurdity in the excluding provision, namely that, on the ‘practical’ approach, it would follow that if a person took lodgings in a boarding house run by a proprietor with the assistance of employees one of whom perhaps the cook was a close relative of the claimant in question, the excluding provision would bear.”
10.	The Commissioner reached a similar decision in CSB/176/1986. In that case the claimant’s son and daughter‑in‑law were two of the four partners who ran the nursing home in question. In paragraph 4 of his decision the Commissioner said:
“4. With regard to the partnership aspect, a partnership is not a legal entity separate from its partners. A partnership is a joint venture between the parties who individually carry out the purposes of the venture and are jointly and individually responsible for what they do as partners . . . Now paragraph 1 of the Schedule contains the words ‘. . . are provided in whole or in part . . .’. And in my view the fact that the son and daughter‑in‑law and two others owned the Hollies in partnership cannot mean that the accommodation in the Hollies was not provided at least in part by the son and daughter‑in‑law. As the adjudication officer now concerned with the case submits in response to my direction there is nothing in paragraph 1 of the Schedule to indicate that anything turns on whether the close relatives themselves occupy or part‑occupy the accommodation. In my view the fact that the son and daughter‑in‑law live elsewhere does not alter the position.”
11.	In my judgment, as the proprietor of the nursing home, the claimant’s daughter was “providing” the accommodation and meals. She was the proprietor, she gained any profit or suffered any loss that the nursing home made, and she was ultimately responsible for running the nursing home. I have no doubt that she “made available” the accommodation and meals for the claimant. It follows that, in my judgment, as she was undoubtedly a close relative, the accommodation and meals were provided for the claimant by a close relative and paragraph 14 therefore applied. The decision of the appeal tribunal was erroneous in law and I set it aside. I give the decision which they should have given: section 101(5)(a)(i) of the Social Security Act 1975. My decision is as set out in paragraph 1 above.
12.	For those reasons I allow this appeal.

Date: 13 August 1990	(signed) Mr. A. T. Hoolahan
Commissioner