COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
A SOCIAL SECURITY COMMISSIONER
(Mr. Patrick Howell Q.C.)
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE MANCE
LADY JUSTICE HALE
|- and -|
|SECRETARY OF STATE FOR WORK AND PENSIONS||First Respondent|
|SOCIAL SECURITY ADVISORY COMMITTEE||Second Respondent|
Smith Bernal Reporting Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
Mr. Philip Sales and Mr. Jason Coppel (instructed by the Office of the Solicitor to the Department for Work and Pensions) for the First Respondent
Mr. John Howell Q.C. and Miss Gemma White (instructed by the Treasury Solicitor) for the Second Respondent
AS APPROVED BY THE COURT
Crown Copyright ©
Peter Gibson L.J.:
"A person who does not satisfy the all work test shall be treated as incapable of work if in the opinion of a doctor appointed by the Secretary of State –
(b) he suffers from some specific disease or bodily or mental disablement and, by reasons [sic] of such disease or disablement, there would be a substantial risk to the mental or physical health of any person if he was found capable of work ...."
Para. (b) applied to Mr. Howker, as was accepted by the Department. However, in an unreported judgment of Collins J. on 12 September 1996 in R v Secretary of State for Social Security ex p. Moule Reg. 27 was held to be invalid as outside the enabling legislation, in that it provided for the question of deemed incapacity to be determined by a doctor approved by the Secretary of State rather than by an adjudication officer as required by the legislation.
".... Regulations may provide that a person shall be treated as capable of work, or as incapable of work, in such cases or circumstances as may be prescribed."
"(a) to give (whether in pursuance of a reference under this Act or otherwise) advice and assistance to the Secretary of State in connection with the discharge of his functions under the relevant enactments ...."
The relevant enactments include the Social Security Contributions and Benefits Act 1992 and the 1992 Act. By s. 170 (4):
"The Secretary of State shall furnish the Committee with such information as the Committee may reasonably require for the proper discharge of its functions."
(b) to section 173 below,
where the Secretary of State proposes to make regulations under any of the relevant enactments, he shall refer the proposals, in the form of draft regulations or otherwise, to the Committee."
"(1) Nothing in any enactment shall require any proposals in respect of regulations to be referred to the Committee .... if –
(a) it appears to the Secretary of State that by reason of the urgency of the matter it is inexpedient so to refer them; or
(b) the [Committee has] agreed that they shall not be referred.
(2) Where by virtue only of subsection (1)(a) above the Secretary of State makes regulations without proposals in respect of them having been referred, then, unless the [Committee] agrees that this subsection shall not apply, he shall refer the regulations to [it] as soon as practicable after making them.
(3) When the Secretary of State has referred proposals to the Committee ...., he may make the proposed regulations before the Committee have made their report .... only if after the reference it appears to him that by reason of the urgency of the matter it is expedient to do so.
(4) Where by virtue of this section regulations are made before a report of the Committee has been made the Committee shall consider them and make a report to the Secretary of State continuing such recommendations with regard to the regulations as the Committee thinks appropriate; and a copy of any report made to the Secretary of State on the regulations shall be laid by him before each House of Parliament together, if the report contains recommendations, with a statement –
(a) of the extent (if any) to which the Secretary of State proposes to give effect to the recommendations; and
(b) in so far as he does not propose to give effect to them, of his reasons why not."
"(1) The Committee shall consider any proposals referred to it by the Secretary of State under section 172 above and shall make to the Secretary of State a report containing such recommendations with regard to the subject-matter of the proposals as the Committee thinks appropriate.
(2) If after receiving a report of the Committee the Secretary of State lays before Parliament any regulations or draft regulations which comprise the whole or any part of the subject-matter of the proposals referred to the Committee, he shall lay with the regulations or draft regulations a copy of the Committee's report and a statement showing –
(a) the extent (if any) to which he has, in framing the regulations, given effect to the Committee's recommendations; and
(b) in so far as effect has not been given to them, his reasons why not."
"The amendment has an effect in changing the wording but only to clarify its meaning to what it was always believed to have meant. This may arise because lawyers have realised it could mean something different. However, no one will lose or gain, the amendment simply secures what has always been the interpretation of the present wording."
In contrast "adverse" means:
"This is used when existing claimants will lose money in future. It may only involve a few people and the loss may be of money they clearly should not have had – but there is a loss."
"The amendment defines this "exceptional circumstance" provision more precisely in the light of the High Court judgment. But we are satisfied that it will not exclude anyone whom we originally intended to be covered. We are redefining the provision more precisely in the light of the court's decision. But, as I said, it is not our intention that anyone who would have been covered originally should now be excluded."
"(1) A person who does not satisfy the all work test shall be treated as incapable of work if any of the circumstances set out in paragraph (2) apply to him.
(2) The circumstances are that –
(a) he is suffering from a severe life threatening disease in relation to which –
(i) there is medical evidence that the disease is uncontrollable, or uncontrolled, by a recognised therapeutic procedure, and
(ii) in the case of a disease which is uncontrolled, there is a reasonable cause for it not to be controlled by a recognised therapeutic procedure;
(b) he suffers from a previously undiagnosed potentially life threatening condition which has been discovered during the course of a medical examination carried out for the purposes of the all work test by a doctor approved by the Secretary of State;
(c) there exists medical evidence that he requires a major surgical operation or other major therapeutic procedure and it is likely that that operation or procedure will be carried out within three months of the date of a medical examination carried out for the purposes of the all work test."
"(1) The Committee members were materially misled by what they were told by the departmental officials about the proposed amendment of regulation 27. In particular they were misled by the statements made in Mr. Axton's letter of October 1996 and the explanatory memorandum on "Proposal 11: [neutral amendment], telling them that the purpose and effect of the amendment was only to cope with the procedural consequences of transferring the decision on exemption from the all work test to an adjudication officer instead of a doctor in the wake of the decision in ex parte Moule, and that the changes were "neutral" in their effect on claimants in that no existing entitlement under the regulation would be taken away.
(2) Those statements were untrue, and obviously so to anyone who looked at the old exempting conditions in conjunction with the new ones. The decision to remove the old regulation 27(b) as a separate head of exemption cannot have been other than deliberate, to take away an existing basis of entitlement actually being awarded on the opinion of the department's own doctors.
(3) Those statements were made by the departmental officials responsible for them with the intention that the Committee should act on them in deciding whether or not to give their agreement that a reference and report on the proposed amendment was not necessary; and were made with a view to securing such agreement.
(4) The misleading impression given by the written statements was not corrected by any adequate explanation of the substance of the change to regulation 27 in the course of the meeting itself: the reference to the removal of the "substantial risk" exempting condition recorded in the minute at para 3.5 leaving the continuing, and misleading, impression that any person whose entitlement currently arose by reason of that provision would instead continue to be entitled under some other provision of the redrafted regulations, and that all was related to the procedural changes necessary following the High Court decision.
(5) The Committee members with entire propriety and good faith accepted and acted on the misleading statements and assurances made to them, and gave their agreement on that basis.
(6) Finally, I consider it the proper inference to draw from the Committee's obvious concern as shown by minutes 3.4 and 3.5, the factual explanation given by Mr. Smith's letter shortly after the event which I accept as accurate, and what in fact happened over proposal 26 (severe disablement allowance, the one amendment described to them as "adverse"), that they would not have acted as they did if the amendment to regulation 27 removing the exempting condition of which most advantage had been taken by claimants had been correctly presented to them as the adverse amendment it was, but would then have required it to be the subject of a reference and report along with proposal 26; and I so find."
"the net impression, I regret to have to say, is of a piece of extremely sharp practice in the dealings of departmental policy officials with the Committee, for which no satisfactory explanation (indeed no real explanation of any kind) has been put forward."
"The issue on which this case depends therefore resolves itself, in my judgment, to one simple question of statutory construction of what, if any, limitations are to be placed on the single word "agreed" in section 173 (1)(b)."
"But once the concession was made that this was not such a case, and I was not being asked to make any finding that the Committee's agreement had been procured by deception, the possibility of challenge to the validity of these regulations was in my judgment for practical purposes at an end."
"In my judgment however that is placing far too heavy and broad a set of implied limitations on the single word "agreed" in this context. Parliament cannot possibly be taken to have intended that I or any other court concerned with the validity of secondary legislation affecting individual private rights should embark on a process of enquiry akin to judicial review into the past processes of the Social Security Advisory Committee, before determining whether what would undoubtedly be accepted in any ordinary litigation as the objective facts of their agreement should be allowed to "count" for this purpose or not. That special jurisdiction is not of course one I have or can exercise, and though the Queen's Bench Divisional Court no doubt might grant prerogative remedies in relation to the functions of the Social Security Advisory Committee in a proper case, it has not done so here. I decline to think that Parliament by using the word "agreed" intended me to embark on what would be bound to be an entirely speculative exercise on whether that Court would have ever thought right to allow such proceedings to be brought before it in relation to the Committee's decision on these regulations (now in any event completely impossible because of the lapse of time), or what, if anything, it would or might have thought fit to do or say about it if it had."
(1) the Commissioner has the same jurisdiction to rule on the validity of the new Rule 27 as the Administrative Court on an application for judicial review, and can exercise that jurisdiction notwithstanding that the three-month period normally applicable for judicial review proceedings in the Administrative Court has expired;
(2) the statutory procedure for making regulations in the social security field requires that Parliament should have the assistance of the Committee in the form of a report on regulations proposed by the Secretary of State unless (so far as material in the present case) the Committee has agreed to no reference of the proposals;
(3) the Secretary of State in breach of his duty under s. 170 (4), through his officials provided the Committee with information which was erroneous, as was obvious to anyone comparing the old Reg. 27 with the proposed Reg. 27;
(4) thereby the Committee was misled into giving its agreement to no reference;
(5) the Committee would have required the proposed Reg. 27 to be referred to it if the proposal had been correctly presented as "adverse";
(6) Parliament was thereby deprived of the report which it should have received from the Committee;
(7) the Secretary of State through his officials being responsible for the flaw in observing the prescribed procedure for making the new Reg. 27, the new Reg. 27 made by him is invalid.
(1) the appeal turned on whether as a matter of construction of s. 173 (1)(b) the Committee "agreed" that the proposed new Reg. 27 should not be referred to it;
(2) agreement in fact suffices, and that is supported by the following policy considerations:
(a) regulations should provide clear and certain rules as to entitlement to benefit, and a construction should be adopted which promotes equal treatment of claimants over time and proper governmental and Parliamentary control over the allocation of public monies for benefit payments;
(b) in the absence of fraud, the Department and Parliament should be able to take the agreement of the Committee at face value;
(c) procedural challenges to delegated legislation should be confined to failures to comply with explicit statutory requirements, as it would otherwise be possible to unravel regulations put before Parliament years after the event on grounds of invalidity when there has been no timely challenge by way of judicial review;
(d) decision-makers in social security benefit offices and appeal tribunals are not well suited to undertake judicial review investigations;
(e) the fact that the Committee has a purely advisory role indicates that Parliament cannot have intended that some error of procedure or understanding on the part of the Committee would vitiate subsequent regulations made by the Secretary of State with the approval of Parliament;
(3) only if a statutory instrument is patently defective by reference to the requirements of the enabling statute will the subordinate legislation be held ultra vires (City of Edinburgh District Council v Secretary of State for Scotland  SLT 551 and 557);
(4) s. 170 (4) is inapplicable because the Committee did not explicitly require the Department to furnish it with information, and there was no patent non-compliance by the Secretary of State with his obligations, and the inadequacy of the information given by the Department to the Committee could only be regarded as at most infringing a directory rather than a mandatory obligation; alternatively the distinction between mandatory and directory obligations is too simple and the legal consequences of a failure to comply with an obligation should depend on factors such as the state of mind of the person on whom the obligation is placed;
(5) if wrong on these submissions, having regard to the fact that the new Reg. 27 has been in operation for many years and that no unhappiness over what occurred has been expressed by the Committee or Parliament, the court should not hold it to be invalid.
(1) there is no rational basis for distinguishing between a misunderstanding by the Committee in agreeing to no reference where that was caused by the Secretary of State, through his officials, misleading the Committee and any other misunderstanding by the Committee arising from some other cause;
(2) on the true construction of s. 173 (1)(b) the apparent agreement by the Committee suffices; there is no difference between the meaning of "agreed" in s. 173 and that of "agreed" in s. 176 (2) of the 1992 Act where an obligation of the Secretary of State, before making regulations in respect of certain other benefits such as housing benefit, to consult with representative organisations is subject to an exception if the organisations have "agreed" that such consultations should not be undertaken;
(3) the agreement of the Committee to no reference can only be impugned if not given in good faith (compare R v Barnet and Camden Rent Tribunal, ex p. Frey Investments Ltd.  2 QB 342, Asher v Secretary of State for the Environment  Ch. 208 and Norwest Holst Ltd. v Secretary of State for Trade  Ch. 201);
(4) the consequence of a procedural failure to obtain a report from the Committee does not necessarily deprive the Secretary of State of the power to make regulations nor does it necessarily deprive the regulations so made of legal effect; it is not contended that the Secretary of State misdirected himself in making the new Reg. 27 nor that it was such that no reasonable Secretary of State could have made it; nor did Parliament refuse to deny effect to the new Reg. 27 unless a report was received from the Committee; Parliament did not intend that regulations of this character should be treated as invalid merely in order to ensure that it receives a report which it has chosen not to require.
"The Committee's assumption that it can rely on these officials to provide full, balanced and objective information without relevant points being withheld or obscured is in my judgment an entirely proper one, wholly consistent with the intention of section 170(4). The Committee members should be able to rely implicitly and without question on the completeness of what they are told [by] those whose duty it is to assist them. It is quite inconsistent with the scheme of Part XIII of the Act for it to be thought otherwise."
Lady Justice Hale:
"But in my judgment it was an important feature of both cases [R v Wicks and Quietlynn Ltd v Plymouth City Council  1 QB 114] that they were concerned with administrative acts specifically directed at the defendants, where there had been clear and ample opportunity provided by the scheme of the relevant legislation for those defendants to challenge the legality of those acts before being charged with an offence.
By contrast, where subordinate legislation (eg statutory instrument or byelaws) is promulgated which is of general character in the sense that it is directed to the world at large, the first time an individual may be affected by that legislation is when he is charged with an offence under it; . . ."
"My Lords, in constitutional law a clear distinction can be drawn between an Act of Parliament and subordinate legislation, even though the latter is contained in an order made by statutory instrument approved by resolutions of both Houses of Parliament. Despite this indication that the majority of members of both Houses of the contemporary Parliament regard the order as being for the common weal, I entertain no doubt that the courts have jurisdiction to declare it to be invalid if they are satisfied that in making it the Minister who did so acted outwith the legislative powers conferred upon him by the previous Act of Parliament under which the order purported to be made, and this is so whether the order is ultra vires by reason of its contents (patent defects) or by reason of defects in the procedure followed prior to its being made (latent defects)."