Brother and sister John and Mary jointly own the house in which Ann, their mum, has been living for a peppercorn rent. Ann became ill and has been staying with Mary 100 miles away for six months while receiving treatment. She is better but not expected to live more than a year or so longer so now she is moving to a care home in her home town where she can be amongst friends and relatives. Social Services will pay most of the cost but expects Ann to make up some extra. John and Mary are selling the house and are looking forward to receiving half the value each but Mary knows she will need to keep some back to contribute to the cost of her Mum’s care. However John doesn’t agree as he wants the cash and and he says Ann will just have to stay with Mary and her long-suffering family.

Does the solicitor dealing with the sale of the house have the right to hold back funds from the sale so as to force John to contribute to the cost of his mother’s care?

If Ann has no assets how can she contribute to her care in a home?

Anything from John and Mary is voluntary.

Ann will just have to stay with Ann

Say what…

Sorry, corrected now.

Social Services want John and Mary to sign a contract agreeing to pay the extra. John is refusing to sign.

IANAL but surely if John owns 50% of the house he’s entitled to 50% of it’s sale value. He sounds like a tool but I can’t see how there would be a law that would force a part of the house sale to go towards care home costs as that’s a separate issue. Doesn’t the mother have her own savings (or other assets to sell) to contribute?

Ann only has about £2000.

It’s a condition of Social Services that if they are to pay most of the cost of the home, either the resident or her spouse, friends or family must agree to make up the extra.

John is destined for a large kick up the arse from Karma.

Did the house previously belong to the mum, and if so, how long since the transfer of ownership?

CAB would be a good move to find out if that kind of proposed arrangement from social services is a legally sound way of avoiding their statutory obligations to provide care to people with no substantial income or capital assets.

This may be helpful:

Care home top-up fees: Do you really have to pay?

In Scotland, the relatives cannot be forced into subsidising the care home fees. Of course, that can mean no choice of care home.

What was the reasoning behind the peppercorn rental option in the first place?
I guess it’s inevitable that this sort of tax-friendly, cost-avoiding inheritance route will pop up a few of these cases.

Of course, that can mean no choice of care home.

That’s probably the nub of it from my reading of the OP. If it’s a nicer room in a nicer care home then the LA will probably make it conditional on a contribution from relatives. If there is no choice or perks involved, the council may well still try it on, but I can’t see how it is enforceable.

Trouble is, they generally have you over a barrel trying to argue over contracts at a point of great upheaval and stress…

Exactly. After five months of nursing an incontinent mother Mary hasn’t got the energy to fight the Council.

But would the solicitor handling the house sale have the right to hold back funds for Ann’s care until she dies?

But would the solicitor handling the house sale have the right to hold back funds for Ann’s care until she dies?

No. The two transactions are completely unrelated.

This is a ‘voluntary’ payment from relatives to top up care home fees. No-one can be forced to pay it. Effectively it boils down to one of the siblings refusing to contribute to his mum’s care. Either he just doesn’t want to cough up, or thinks that if you both refuse, the local authority will have to meet the entire cost.

But would the solicitor handling the house sale have the right to hold back funds for Ann’s care until she dies?

If it’s not Ann’s house she’s not entitled to the proceeds of any sale – I’d have thought, in my non-lawyerly way

Did Ann ever own her own home? What happened to it? Did she somehow pass ownership to her kids?

Regardless, John sounds like a tosser, I’m not yet sure about the other two

Is this about deprivation of assets?
Deliberate deprivation of assets occurs when an individual transfers an asset out of her possession in order to put themselves in a better position regarding the means test for care home accommodation – ie to make it more likely that they will qualify for local authority assistance towards the costs.

Did the house previously belong to the mum, and if so, how long since the transfer of ownership?

I wondered that. In England, councils have pretty swingeing powers to claw back proceeds of sale of houses that have been transferred to avoid care fees. I think the practice is to reply that the house was transferred to avoid tax, but I’m not sure how well that really flies.

Ann gifted the house to her children about ten years ago. So far the council have accepted that Ann has almost no assets.

And yes, John is indeed a tosser of the highest degree. His rudeness and intransigence are contributing heavily to Mary’s stress.

So put another way: could Mary ask the solicitor to put some cash from the house sale aside for Ann’s care?

One of the risks of giving your kids their inheritance before you die is that occasionally the ungrateful bastards don’t want to give any of it back if you need it.

John is destined for a large kick up the arse from Karma.

And I would happily pay money to see it – a fundraiser for his poor Mum’s care costs and a well deserved holiday for his sister?

could Mary ask the solicitor to put some cash from the house sale aside for Ann’s care?

Yes, but only from her half of it.

Although I’d get tax advice on all of this as there may be capital gains to be paid on the ‘profit’ since they were given the house.

Re the forcing John part: no.

Spend the money it’s ‘Mary’s’ mum FFS. Screw the other one. John can see what it would have been like to have the care of loving family in his dotage if he wasn’t such a twunt and then piss off with his 30 pieces silver.

It’s only money.

John used to be a tax inspector before his current job so one would assume that he knows all about the liabilities.

John used to be a tax inspector before his current job so one would assume that he knows all about the liabilities.

I’d hope so – the ‘peppercorn rent’ bit could certainly cause you difficulties these days, don’t know how far back that would go though.

Thanks all for your valued input; it has helped me to clarify the situation in my mind.

You might have an issue with the gifting of the house as the gifter/settlor continued to have beneficial use of it. The peppercorn rent could be the nub of that, it would have to be a market value rent or the gift could be overturned, but that’s more for IHT purposes rather than who actually owns the house.

Spend the money it’s ‘Mary’s’ mum FFS. Screw the other one. John can see what it would have been like to have the care of loving family in his dotage if he wasn’t such a twunt and then piss off with his 30 pieces silver.

It’s only money.

This. Do the right thing (which it sounds like you/your wife? want to do), you’ll be glad you did.

I’m not saying I agree with it by any means, but it seems to me that Mum gave the house to the kids precisely to avoid care costs/taxes.
John is sticking by his guns in the hope that it can’t be taken off him. Be honest about the situation and the authority will take what they legally can.

Sod them, if the government can afford trident, Europe, bank bailouts, endless immigration, politicians pay rises etc, etc, they can certainly afford to pay for Ann’s care. It’s the least they can do.

Edit: sorry if that didn’t answer any of your questions

The bit of the government that has to pay for Ann’s care isn’t the same as the bit that is paying for trident and politician’s pay rises.
In fact I’d hazard a guess that they wish the money wasn’t being wasted spent on those things as well.

I don’t think there’s an issue about the council paying for care, it seems more like it’s not where the OP wants it to be (possibly 100 miles away?)

What does mum want to do? Does she want to live in a care home? I wouldn’t!
Is she incapable of looking after herself, or is it just inconvenient now the brochures are out?

The government or local authorities pay for nothing. Taxpayers pay.

Is there a reason why Ann cannot pay her share as the LA asks? I don’t see how John can be forced to legally (I’m not saying it’s nice of him to behave this way).

My mum is in a care home and her money lasts about another 18months after which time I’ll be paying the extra above the council provided care to give her the room she wants, where she wants to be. Irrespective of whether my sibling co-contributes. She’s my mum, spent a large part of her time, money and emotion bringing us up. It’s payback time.

John sounds like a right idiot. Both John and Mary tried to get around the system of care costs with the house gift and peppercorn rent thing. It’s his mother – pay up.

Did Ann own the home within the last 7 years? If so the problems are:

1. Ann is currently only paying “peppercorn rent” in which case HMRC will almost certainly be interested in whether there’s been a “reservation with benefit” and whether the rent was declared as income – particularly if there’s no documentation to prove the basis on which the ownership of the property was transferred.

2. The relevant LA will be interested in seeing with the property was transferred in order to avoid the care home fees test (they can and frequently do go back 7 years on this).

John and Mary have probably tried to do what they thought was right / best but the situation is now overtaking them and damaging their sibling relationship – and because money is involved it often brings out the worst in people.

It’s a tough scenario though – at the end of the day care costs are enormous and almost unaffordable to governments and individuals alike.

Sorry for the hijack but I’ve a related question.

If Mary and her mum had both sold separate houses and bought the current house (10+ years ago) which was jointly owned. With a signed document explaining the ownership etc. they have both lived there for the whole time since purchase

How would that impact on the situation? I’ll leave john out of my question as I don’t think I like him much…

Can’t answer that but I thought forum members would be interested to know that brother John, despite the fact that he is about to receive half of the proceeds from the sale of the £165,000 house – tax free as the transfer of ownership was 10 years ago – is refusing to pay a penny towards topping up his mum’s care home costs for the last year or two of her life. We’re talking around £180 a month here.

global, unfortunately it’s hard to legislate against people being selfish bastards…

ian – more information is needed so don’t take this as gospel, but roughly speaking it depends on whether the house was bought as joint tenants or tenants in common. if joint tenants, they are entitled to an equal share. if tenants in common, the document explaining the ownership will have explained what the relative entitlements are between the two people involved.

sweepy – Member
I’m not saying I agree with it by any means, but it seems to me that Mum gave the house to the kids precisely to avoid care costs/taxes.
John is sticking by his guns in the hope that it can’t be taken off him. Be honest about the situation and the authority will take what they legally can.

I do believe there is something missing as sweepy says, what exactly has mum said? If all of them have done this to avoid tax and healthcare costs, then what John is doing is only upholding that agreement, as painful as it may be. Typically man like, he’s removed the emotional context from the situation (downfall of most good ideas). Would you renege on a legally binding contract if someone gave you a sob story?

There’s no contract. The only reason why John should pay is because his sister Mary is going to pay and Ann, his mother, fed, clothed and brought him up.

I’ve always thought him a weird barsteward and this only confirms it. Ann’s brother and sister are going to try to persuade him to pay by visting him in person and if he still refuses I’m recommending that the family cut him off.