In YL v Birmingham City Council and Ors [2007] UKHL 27, by a majority of 3:2 (Lord Bingham and Baroness Hale dissenting), the House of Lords held that a private care home did not perform functions of a public nature and, consequently, was not required to comply with Convention rights under section 6(1) Human Rights Act 1998 (the Act). The issue before the court was whether a private care home, in providing care and accommodation for the appellant, was exercising a public function for the purposes of section 6(3)(b) of the Act. This issue has attracted much public and academic debate and a number of parties intervened in the action including Help the Aged and Liberty.

Lord Bingham, dissenting, considered the issue to be clear and the circumstances of this case to be "precisely the case which section 6(3)(b) was intended to embrace". However the majority disagreed finding that the care home's activities did not bring it within the ambit of section 6(3)(b).

It appears that the Lords were concerned that the floodgates would be opened if every contracting out of a function that a local authority could have carried out itself turns the contractor into a "hybrid public authority" for the purposes of section 6 of the Act.