The founder and former chief executive of a leading Scottish social care charity has died after a two-month struggle with Creutzfeldt-Jakob disease.

Nick Baxter, 65, who founded Cornerstone three decades ago to provide support for people with learning and physical disabilities, declined rapidly after being diagnosed with the incurable degenerative neurological disorder.

In an email sent to friends and family announcing his death, Mr Baxter's son-in-law Scott Ellis said: "Nick never shirked a challenge and was well known to be successful in pushing boulders up mountains to get things done. However, on this occasion he was up against a significant opponent – Creutzfeldt-Jakob disease, or CJD. The disease has been very aggressive in taking a very healthy and spirited man from our lives."

A former social worker with Grampian Regional Council in Aberdeen, Mr Baxter set up Cornerstone in 1980 after becoming disillusioned with the way institutions treated people with disabilities.

He believed there was a better way and worked to care for them in the community instead. The charity now has premises all over the country, including in Glasgow, and employs 1700 people.

Mr Baxter's daughter Antonia Ellis said helping people with disabilities had been her father's entire life. "He set up Cornerstone the year I was born and it had a huge impact on so many people's lives," she said. "As a social worker, he felt there had to be a better way of doing things than sending people to institutions."

Ms Ellis said her father's doctors did not know what had caused his CJD. "It could have been incubating in him for years but they know so little about it," she said.

She said her father had been diagnosed with Sporadic CJD, one of four different forms of CJD. CJD is caused by the accumulation in the brain of an abnormal form of a protein called a prion protein and normally strikes between the ages of 60 and 65.

At the weekend, it was reported up to 1000 people could die from the disease through infected blood given to them in hospitals. Government experts said the risk remained of catching variant CJD via blood transfusions. It is estimated 30,000 Britons could have the dormant illness, double previous estimates.

Ms Ellis said her father's doctors said the disease could not have been contracted through contaminated meat.

Mr Baxter, who died on Sunday, had been retired for five years – he stepped down as chief executive of Cornerstone in 2008, handing over the reins to Edel Harris.

Mr Harris said: "As founder of Cornerstone, he was always a strong advocate for people with learning disabilities and did so much to change attitudes and improve the lives of so many.

"The charitable work of Cornerstone will always be part of Nick's legacy, and his commitment to ensuring everyone in society had a chance to live a valued life won't be forgotten."

Cornerstone provides residential and respite care homes and it works in 20 local authority areas in Scotland. Initially, Mr Baxter ran it from his dining room in Aberdeen with the support of a small group of parents and social workers. It now has its headquarters in the city.

In the email to friends, Mr Ellis said the creation of Cornerstone had given his father-in-law the satisfaction that many people were being helped by his organisation.

He said: "When asked to name his career highlight, he gave this reply: seeing a Cornerstone user waiting for a bus. This gentleman had lived in hospital for many years and had virtually no independence. And there he was standing at the bus stop, waiting for a bus, just like anyone else."