High Court confirms protection of Personal Injury Trust funds in care funding dispute
The High Court has recently quashed a local authority’s decision to refuse care funding to a disabled adult where compensation was held in a Personal Injury Trust.
In R (on the application of CGT) v West Sussex County Council [2026] EWHC 293 (Admin) (13 February 2026), the claimant was a severely disabled man with lifelong care needs arising from a brain injury sustained in infancy. In 2012, he received a substantial Criminal Injuries Compensation Authority award, including a large element specifically to meet future care costs. The compensation was placed into a Personal Injury Trust to ensure it could be used for that purpose without impacting entitlement to means-tested support.
West Sussex County Council had previously contributed towards the claimant’s care costs on a without-prejudice basis while further arrangements were being considered. In June 2024, the council wrote to say that it would cease funding the claimant’s assessed care needs from July 2024 and required repayment of more than £270,000 it had paid between July 2020 and July 2024. The authority’s position was that the compensation held in the trust should be treated as available capital for assessment purposes.
The claimant challenged the decision by way of judicial review. The High Court held that the council had acted unlawfully and overturned its decision. The Court confirmed that, under the Care and Support (Charging and Assessment of Resources) Regulations 2014 and the accompanying statutory guidance, capital held in a Personal Injury Trust derived from compensation for personal injury must be disregarded when carrying out a means assessment for care funding. A local authority cannot “go behind” that statutory disregarded status and treat such funds as available capital simply because they have been placed in trust or because they include elements earmarked for care.
Although the factual background in this case – including earlier undertakings given in settlement and a change in deputy – was complex, the judgment reaffirms a fundamental protection for seriously injured claimants: where compensation is properly placed into a Personal Injury Trust, those funds are excluded from capital assessment when determining local authority care funding eligibility.
Laura Rumsey, Director and Head of Private Client at Rogers & Norton, said: “Our Private Client team often advises on establishing and administering Personal Injury Trusts to ensure compensation awarded for future care is protected and treated appropriately in means-tested assessments and often work closely with our Personal Injury and Clinical negligence team colleagues to implement such arrangements.
This decision provides welcome clarity on how Personal Injury Trusts are to be treated in the context of care funding. It is vital to consider carefully the structure of any trust, who should act as trustees and how it will operate in practise so that the compensation can provide for long-term needs without unintended consequences”.
Mark Hambling, Head of Personal Injury, commented further: “For many seriously injured clients, compensation is intended to support long-term care, rehabilitation and quality-of-life needs. This case highlights why early and structured advice about Personal Injury Trusts is so important. Ensuring the right framework is in place from the start can make a significant difference to a client’s financial and care planning long term and is an area regularly discussed when considering the impact of both interim payments and settlements.”
If you would like advice on bringing a personal injury or medical negligence claim, or on establishing a Personal Injury Trust, please contact our Personal Injury, Clinical Negligence or Private Client Teams.
For more information on our legal services or to arrange an appointment with a member of our team, contact us at 01603 666001, email enquiries@rogers-norton.co.uk or complete the ‘Request a Consultation’ enquiry form on our website.