England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE SOCIAL SECURITY COMMISSIONERS

		Royal Courts of Justice Strand London WC2 Monday, 4th March 2002

1. LORD JUSTICE WARD: Lord Justice Keene will give the first judgment.
2. LORD JUSTICE KEENE:This appeal by the Secretary of State for Work and Pensions concerns the circumstances in which Invalid Care Allowance ("ICA") is payable when the person being cared for is in hospital.
3. The appeal is brought against a decision of the Social Security Commissioner dated 22nd June 2000, permission to appeal being granted by the Commissioner on 14th November 2000. It is to be noted that permission to appeal to this Court was granted on terms set out in a letter dated 9th November 2000 from the appellant's solicitor, whereby the appellant agreed not to seek any sum from the respondent beyond the amount already recovered and also to cover the respondent's reasonable costs.
4. Under the Civil Procedure Rules Part 52 Practice Direction, paragraph 21.5(2), the appellant's notice should have been filed within six weeks after the date of the Commissioner's grant of permission to appeal on 14th November 2000. It was not in fact filed until 14th June 2001, some seven months after the grant of permission. Consequently, the appellant has today had to seek the necessary extension of time. A witness statement by a senior principal legal officer in the appellant Department states that:

"On 5th February 2001 instructions were sent to Counsel (but not the Counsel currently instructed). The lawyer with conduct of the case chased Counsel periodically by telephoning and speaking to the clerks, but was not able to speak to him personally until 11th May 2001 when it became clear that he had not received the papers. As the papers have not been returned as undelivered by the DX system, I can only assume that they were lost in transit.

On 16th May 2001 fresh instructions were sent to counsel and a conference was held on 5th June 2001."

5. As Mr Drabble QC, on behalf of the respondent, points out, that narrative itself reveals a total lack of urgency on the part of the appellant, with instructions only being sent to counsel on the first occasion well outside the prescribed six-week period for filing the notice. Moreover, it then seems to have taken three months for it to be discovered that those instructions had gone astray. No proper explanation is provided either for the delay in first attempting to instruct counsel or for the failure to discover that the attempt had failed until a further three months had expired. I also see force in Mr Drabble's point that the subject matter of these proceedings was a series of events of some age - events which took place in 1995, now nearly seven years ago - and that the Commissioner, in his decision in June 2000, was by then already referring to the "extreme delay" which had occurred. So there can be no doubt that the delay on the part of the appellant in this case in filing its appellant's notice was very substantial and virtually unexplained.
6. Mr Forsdick, for the appellant, does not seek to suggest that it is excusable, but he points to a number of considerations which he submits make it in the public interest that this appeal should be heard on its merits. In particular, he makes the point that, if the Commissioner's decision stands, something of the order of £3 million per annum in additional benefits would have to be paid out on what the Secretary of State believes to be an error of law.
7. It is clear from the documents and the submissions made this morning that the issue is one of general importance which is likely to affect a large number of claimants for ICA. The issue concerns the interpretation of the Social Security Contributions and Benefits Act 1992 ("the 1992 Act"), section 70, and regulations having effect thereunder, the Social Security (Invalid Care Allowance) Regulations 1976 ("the 1976 Regulations"). It seemed to me that it would be regrettable if that issue were not to be determined by this Court. That consideration alone might not suffice if the respondent, Mr Pridding, were at risk of suffering loss if this delayed appeal were to be decided against him. He is entitled to have his welfare rights determined without significant delay. However, as I have already indicated, Mr Pridding does not stand to lose financially, whatever the outcome of this appeal. It is conceded on his behalf that there is no potential prejudice to him from this appeal being determined on its merits. It was that combination of the lack of prejudice to the respondent and the clear public importance of the legal issue in this case being resolved which led me, for my part, to conclude that, despite the substantial delay on the appellant's part in this case, the necessary extension of time - quite exceptionally, I should emphasise - ought to be granted. The court so indicated earlier and did extend time.
8. I turn, therefore, to the substance of this appeal and I begin with the legal context. Section 70 of the 1992 Act, in so far as relevant for the present appeal, provides as follows:

"(1) A person shall be entitled to an invalid care allowance for any day on which he is engaged in caring for a severely disabled person if -

(a)he is regularly and substantially engaged in caring for that person;

(b)he is not gainfully employed; and

(c)the severely disabled person is either such relative of his as may be prescribed or a person of any such other description as may be prescribed.

(2) In this section, `severely disabled person' means a person in respect of whom there is payable either an attendance allowance or a disability living allowance ...

(3) A person shall not be entitled to an allowance under this section if he is under the age of 16 or receiving full-time education. ...

(8) Regulations may prescribe the circumstances in which a person is or is not to be treated for the purposes of this section as engaged, or regularly and substantially engaged, in caring for a severely disabled person, as gainfully employed or as receiving full-time education."

9. It is then provided by subsection (9) that ICA shall be payable at a specified weekly rate. At all material times that rate was £35.25.
10. It will be seen from those provisions that ICA is payable in certain circumstances to the carer of a severely disabled person, whereas it is the entitlement of a person to an attendance allowance or, in certain circumstances, a disability living allowance which brings that person, according to the wording of section 70(2) (taking it for the moment at its face value), within the definition of a "severely disabled person". That is because an attendance allowance is only payable to someone who is so severely disabled mentally or physically that he requires considerable attention or supervision from another person. The detailed conditions which have to be met for an attendance allowance are contained in section 64 of the 1992 Act and it is unnecessary to set them out here.
11. The 1976 Regulations (as amended) now have effect as if made under section 70 of the 1992 Act: see the Social Security (Consequential Provisions) Act 1992, section 2(2). There is no dispute that the regulation with which this appeal is concerned, regulation 4, has effect as if made under section 70(8) of the 1992 Act. Regulation 4 of the 1976 Regulations states:

"(1) Subject to paragraph (1A) of this regulation, a person shall be treated as engaged and as regularly and substantially engaged in caring, for a severely disabled person on every day in a week if, and shall not be treated as engaged or regularly and substantially engaged in caring for a severely disabled person on any day in a week unless, as at that week he is, or is likely to be, engaged and regularly engaged for at least 35 hours a week in caring for that severely disabled person.

[It is not necessary to read paragraph (1A)]

(2)A week in respect of which a person fails to satisfy the requirements of paragraph (1) of this regulation shall be treated as a week in respect of which that person satisfies those requirements if he establishes -

(a)that he has only temporarily ceased to satisfy them; and

(b)that (disregarding the provisions of this sub-paragraph) he has satisfied them for at least 14 weeks in the period of 26 weeks ending with that week and would have satisfied them for at least 22 weeks in that period but for the fact that either he or the severely disabled person for whom he has been caring was undergoing medical or other treatment as an inpatient in a hospital or similar institution."

12. It is that last paragraph which is of central importance in this case.

The Facts

13. In 1995 Mr Pridding was looking after his elderly mother and had been doing so since October 1994. At all material times his mother met the medical conditions to qualify her as a severely disabled person for the purposes of attendance allowance. I emphasise the words "medical conditions". Mr Pridding had been receiving ICA as her carer since October 1994 and there is no dispute that he was entitled to receive it until she went into hospital, which she did on 30th May 1995. During that period, from October 1994 until 30th May 1995, Mr Pridding was substantially engaged in looking after his mother. She remained in hospital until she was discharged on 20th September 1995. She was then at home once again being looked after by the respondent until she was again taken into hospital on 14th November 1995. Although this second admission was initially on a trial basis, it became permanent and thereafter she was looked after in hospital at all material times. However, Mr Pridding failed to disclose to the appellant Department his mother's admission to hospital and he continued to claim, and to be paid, ICA up to and including 3rd December 1995. The facts as to his mother's hospitalisation then came to light.
14. On 21st March 1996 an adjudication officer determined that the respondent's mother had not been entitled to attendance allowance for the periods 3rd July 1995 to 24th September 1995 and from and after 18th December 1995. Those dates were arrived at because attendance allowance is not payable for any period when the person in question is an inpatient in a National Health Service hospital, but this disentitlement does not begin until after 28 days as such an inpatient: see the Social Security (Attendance Allowance) Regulations 1991 (as amended), regulations 6 and 8. There is now no dispute between the parties that Mr Pridding's mother was not entitled to attendance allowance during those periods determined by the adjudication officer. For the sake of completeness, it should be noted that the dates determined do not coincide arithmetically with 28 days, the reason being that these allowances are payable in complete weeks, from Sunday to Saturday, and Mrs Pridding was admitted to hospital midweek.
15. An adjudication officer then determined that Mr Pridding had been overpaid ICA because he had received it during those periods when his mother was no longer entitled to attendance allowance. There was an appeal to a Social Security Appeal Tribunal, which upheld the adjudication officer and decided that £493.50 was recoverable from Mr Pridding. He then appealed to the Social Security Commissioner. The Commissioner agreed that there had been an overpayment of ICA, but only to the extent of £211.50. This was because the Commissioner accepted a new legal point raised on Mr Pridding's behalf, and it that point which is in issue on this appeal.
16. The Appeal Tribunal had proceeded on the basis that Mr Pridding was not entitled to ICA during those periods when his mother was not entitled to attendance allowance. This was because, although he was not gainfully employed and although his mother was within the category of prescribed relatives, thereby satisfying paragraphs (b) and (c) of section 70(1) of the 1992 Act, his mother was not a "severely disabled person", at least within the meaning of section 70(2), at those times when she was not entitled to an attendance allowance.
17. The Commissioner, however, took a different approach, based upon regulation 4(2) of the 1976 Regulations. In his decision he said: "20. Legislation which requires one to deem a state of affairs that does not in fact exist and makes use of phrases such as `but for' is always prone to difficulty but in my judgment Miss Davies (the welfare rights officer now representing the claimant) is right in this instance about its apparent effect so that a period of up to twelve weeks', rather than four, continuation of invalid care allowance is permissible while the disabled person is an in-patient in hospital provided always that this remains temporary. Although under the principal definition in s.70(2) a `severely disabled person' ceases to be such for weeks when attendance allowance is no longer payable after the first four weeks of treatment as an in-patient in hospital, it will be recalled that s.70(8) also gives the Secretary of State power to prescribe by regulations the circumstances in which a person is or is not to be treated for the purposes of the section as `engaged in caring for a severely disabled person'.
18. 21. Reg 4(2) of the invalid care allowance regulations appears to me to be within the powers conferred by that sub-section in prescribing that for a limited number of weeks a person is to be treated as continuing to care for a severely disabled person when he is not in fact doing so because the person for whom he had been caring is temporarily in hospital as an in-patient. The mechanics chosen by the legislator to achieve that are to imagine away the fact that the disabled person is in hospital receiving treatment, and it seems to me that the `would have ... but for' formulation must necessarily involve the hypothesis, on facts such as those in this case, that if the claimant's mother had not been still in hospital receiving in-patient treatment, she would have been back at home being looked after by the claimant; and that this would have been bound to involve both his being engaged in caring for her for at least 35 hours a week, and attendance allowance once again being payable in respect of her as a severely disabled person."
19. Since Mr Pridding had in fact been caring for his mother for at least 35 hours per week for at least 14 weeks in the previous 26 weeks, and since he would have met the 35 hours per week test for 22 weeks in the 26-week period but for her hospitalisation, the conditions of regulation 4(2) were met, according to the Commissioner, and therefore so were the conditions of regulation 4(1). The Commissioner consequently concluded that Mr Pridding was entitled to ICA for a further eight weeks beyond the first four weeks of his mother's hospitalisation. In effect, therefore, the Commissioner took the view that Mr Pridding's mother continued to be a severely disabled person even after the time when attendance allowance was no longer payable to her. That decision and the reasoning behind it is now challenged by the Secretary of State.
20. On behalf of the appellant, Mr Forsdick submits that it is basic to entitlement to ICA that the person cared for must be a "severely disabled person" within the definition of section 70(2) of the 1992 Act. If the latter person ceases to come within that definition, the entitlement to ICA ceases. It is contended that regulation 4(2) of the 1976 Regulations is not extending the definition of a severely disabled person. It is concerned, as is regulation 4(1), with what is meant by "regularly and substantially engaged in caring for" such a person. Regulation 4(2) enables the carer to be treated as so engaged even when the disabled person is in hospital so long as the latter remains a severely disabled person according to the definition in section 70(2). Moreover, says Mr Forsdick, nothing in section 70 provides for the definition of a severely disabled person to be altered by regulation. Section 70(8) does not, he submits, empower the making of regulations which alter the statutory definition even by a deeming process.
21. On behalf of the respondent, Mr Drabble relies on the reasoning of the Commissioner. Section 70(8), he submits, enables the Regulations to deem when a person is to be treated as "engaged in caring for a severely disabled person". That embraces both the meaning of "engaged in caring" and also the meaning of "severely disabled person" and both can, therefore, be altered by regulation. It is argued that the latter term, "severely disabled person", has been extended by virtue of regulation 4(2), so that a person in hospital as an inpatient remains a "severely disabled person" even when attendance allowance ceases to be paid and even though that person would then fall outside the definition contained in section 70(2). Mr Drabble submits that section 70(8) is intended to be a wide deeming provision. Its language works perfectly well if read as enabling the Regulations to widen the definition of a "severely disabled person". The word "circumstances" in that subsection can include the situation where the disabled person is in hospital and no longer in receipt of attendance allowance. Likewise, the wording of regulation 4(2), it is said, is wide enough to deem that a disabled person remains severely disabled, even though in hospital, for up to 12 weeks. Mr Drabble points to the fact that if a claimant for ICA goes into hospital he can, subject to meeting the other conditions of regulation 4(2), remain there for 12 weeks out of the 26 and still clearly be entitled to ICA.
22. In my judgment the answer to the question raised in this appeal is to be found by examining the structure of section 70 of the 1992 Act and the function of regulation 4 of the 1976 Regulations. By section 70(1), three basic conditions have to be met before entitlement to ICA: the person must be regularly and substantially engaged in caring for a severely disabled person; he must not be "gainfully employed"; and the severely disabled person must be a relative as prescribed. There are also certain exclusionary criteria which disentitle a person to ICA. Thus a person in receipt of full-time education is excluded from entitlement: see section 70(3). All of these expressions require some definition and the interpretation section for this part of the Act, section 122, only helps to a very limited extent. "Employed" is there defined, but not "gainfully employed". The word "relative" includes, according to section 122, a person who is a relative by marriage; and "prescribed" means prescribed by regulation, as one would expect. Section 70(2) itself provides a definition of "severely disabled person". To my mind, it is significant that that definition is not said to be "subject to section 70(8)" or "subject to the following provisions of this section" or to any similar provision. On the face of it, therefore, section 70(2) is the exclusive definition of such a person. But no subsection in section 70 provides the meaning of the various other expressions used in the conditions for entitlement to ICA or in such exclusionary provisions as are found in section 70(3).
23. Section 70, which is the only section in the 1992 Act dealing with ICA, provides no immediate help, therefore, in what is meant by "regularly and substantially engaged" in caring for such a person. Nor does it define "gainfully employed" or "receiving full-time education". The meaning of those expressions is left to regulations to be made under what is now section 70(8). That is the obvious function of such regulations. "Severely disabled person" has already been defined in section 70(2), but the other phrases to which I have referred have not. Consequently, one finds that regulation 5 of the 1976 Regulations (as amended) provides the meaning of "receiving full-time education"; and regulation 8 does the same for "gainfully employed". Regulation 4(1) deals with the meaning of paragraph (a) of section 70(1). It provides, in effect, that a claimant must be, or must be likely to be, regularly engaged that week, for at least 35 hours a week, in caring for the disabled person. Of course, both section 70(8) and regulation 4 do use the full expression "regularly and substantially engaged in caring for a severely disabled person", but the last five words in that expression are naturally included when referring to "regularly and substantially engaged in caring". If one simply stopped at that point, the question would obviously arise, caring for whom? The inevitable addition has to be made (as the draftsman sought to make it clear) "for a severely disabled person". It was, in my judgment, not intended that including those words should involve some departure from the statutory definition in section 70(2).
24. That statutory definition, as applied in the present case, requires the disabled person to be entitled to attendance allowance in order to be regarded as a "severely disabled person" under section 70(1). But one can readily see why, on that basis, regulation 4(2) was required. A person may remain a severely disabled person even though in hospital as an inpatient for up to 28 days because attendance allowance continues for that time. But that is not enough by itself for ICA to be payable to the carer. The carer is in fact unlikely to be caring for the disabled person for at least 35 hours per week while the latter is in hospital as an inpatient. Consequently, without regulation 4(2), the carer would not have been entitled to ICA, even though the disabled person still qualified as a severely disabled person because still, for those 28 days, entitled to attendance allowance. So regulation 4(2) enables ICA to be claimed in those circumstances. There is, consequently, no conflict or inconsistency between that paragraph of the Regulations and section 70(2) with its definition of a severely disabled person.
25. The situation produced by regulation 4(2) is workable in practice once it is appreciated that a person may spend more than one period of time in hospital during a 26-week period and still be a severely disabled person. He may, for example, spend two periods, each of 28 days, in hospital and still receive attendance allowance for both those periods so long as they are separated by more than 28 days: see the Social Security (Attendance Allowance) Regulations 1991, regulation 8(2)(a). So it is perfectly possible for a carer to provide 14 weeks of actual care and eight weeks of deemed care under regulation 4(2) of the 1976 Regulations and thereby achieve the required total of 22 weeks in the 26-week period under that particular provision.
26. I agree with Mr Forsdick that section 70(8) does not empower the making of regulations which redefine the meaning of "severely disabled person" or which allow someone to be deemed to be such a person even though not meeting the terms of section 70(2). I conclude that section 70(2) provides the exclusive definition of a "severely disabled person". Moreover, even if section 70(8) had the wider scope contended for by Mr Drabble, I for my part would not regard regulation 4 of the 1976 Regulations as widening the meaning of those words in section 70(2) by a process of deeming. That is not its function, nor is it, in my judgment, its effect.
27. For those reasons I would allow this appeal and reverse the decision of the Commissioner.
28. LORD JUSTICE LAWS: I entirely agree that the definition of "severely disabled person" given in section 70(2) of the Social Security Contributions and Benefits Act 1992 applies where the words "severely disabled person" appear in section 70(8). In my judgment there is nothing in section 70(8) to indicate that the Secretary of State is thereunder entitled to disapply that definition in or for the purposes of any regulations he makes under the subsection.
29. I would only add that in my view the delay perpetrated by the Secretary of State in this case is lamentable. Lawyers acting for Government Departments owe important responsibilities in the public interest and should set an example as regards expedition and efficiency in the conduct of litigation, especially where the issues in question may affect many members of the public.
30. LORD JUSTICE WARD: The decision under appeal was given on 22nd June 2000. In that decision the Commissioner described the matter as "this much delayed case". The Department had three months to seek permission to appeal on what was probably the last day of that period, or so I charitably assume. They sought that permission. The Commissioner refused it, saying:

"Given the extreme delay that has already taken place in this case I consider that it would amount to an injustice to the claimant if the Department were now allowed to pursue the question of further recovery against him by making a further appeal in the way now sought.

I would be prepared to reconsider the question of leave to appeal if the Department were to confirm that it will not in fact seek to exact further recovery from the claimant than that permitted under my decision, and makes some proposal covering his costs of arguing the point of principle involved."

31. Those two conditions were met and permission was therefore given on 16th November 2000.
32. The Department then had another six weeks in which to bring this appeal. Time would have expired on 28th December. 28th December was, one notes, in the events which have happened, already six months after the decision under appeal. Did the Department act with any expedition? No, they certainly did not. Six weeks went by before they managed to send instructions to counsel (whom, I hasten to add, was not Mr Forsdick, for whose submissions I am grateful). Those instructions were sent down and then - I read from the statement of truth of the solicitor having the conduct of this appeal -

"The lawyer with conduct of the case chased counsel periodically by telephoning and speaking to the clerks ..."

33. The first thing to note is that it was the lawyer who apparently chased counsel periodically, not the office boy or the tea lady. Counsel was chased periodically, but we do not know how many times during the three months that passed. During that time the clerks were spoken to. We are not told what they were spoken to about. One cannot readily believe that it was about the progress counsel was making with settling the case to present to us at court. It was not until 11th May, after three months of delay, that it was belatedly discovered that the papers had not even reached counsel.
34. If this statement of truth had not been made by a solicitor and officer of the court, I would have found it to be utterly incredible. As it is, I find it to be utterly disgraceful and only short of being scandalous because of the public interest that is involved. If this were ordinary litigation, the applicant would have been shown the door of the court. Moreover, the private litigant would have faced a claim by his disgruntled client for damages for professional negligence. In this case the claim would have been, we are told, £3 million - £3 million of State money. Government Departments are, as my Lord, Lord Justice Laws, has said, to be expected to set the standards of good practice, not win the prizes for incompetence.
35. It is, therefore, with a measure of reluctance that I too agree that, in the interests of justice, time should be extended. For the reasons given by my Lords, with which I agree, I too would allow the appeal.
Order: extension of time granted; appeal allowed and decision of the Commissioner reversed.