The most important recent case dealing with the concept of what constitutes the performance of a public function is YL v Birmingham City Council [2007] UKHL 27. This case involved the provision of care and accommodation in privately run care homes for the elderly. In the Court of Appeal, Lord Justice Buxton confirmed that, following Leonard Cheshire, a private care home, when accommodating the appellants, was not performing the functions of a public authority under the HRA 1998, s 6(3)(b). The House of Lords, in a 3-2 majority decision, confirmed that the care home was not a functional public authority for the purposes of the HRA 1998. Lord Scott (in the majority) summarised as follows at paragraph 26:

'Southern Cross is a company carrying on a socially useful business for profit. It is neither a charity nor a philanthropist. It enters into private law contracts with the residents in its care homes and with the local authorities with whom it does business. It receives no public funding, enjoys no special statutory powers, and is at liberty to accept or reject residents as it chooses (subject, of course, to anti- discrimination legislation which affects everyone who offers a service to the public) and to charge whatever fees in its commercial judgment it thinks suitable. It is operating in a commercial market with commercial competitors.'

However, he stated at paragraph 28:

'The position might be different if the managers of privately owned care homes enjoyed special statutory powers over residents entitling them to restrain them or to discipline them in some way or to confine them to their rooms or to the care home premises.'