ON THE APPEAL FROM THE UPPER TRIBUNAL
(ADMINISTRATIVE APPEALS CHAMBER)
 UKUT 326 (AAC)
Strand London. WC2A 2LL
B e f o r e :
LADY JUSTICE BLACK
LORD JUSTICE KITCHIN
| SECRETARY OF STATE FOR WORK AND PENSIONS
|- and -
|MRS NEERA MOHAMMAD
Mr Andrew Lane (instructed by Wheltons Solicitors) for the Respondent
Hearing date : 18th October 2011
Crown Copyright ©
"AND UPON the [Respondent] undertaking and agreeing with the [husband] to use her best reasonable endeavours to procure the release of [the husband] from the open plan mortgage and open plan accounts with Woolwich PLC secured against [the home] and to indemnify the [husband] in relation to any liabilities arising thereunder and to accept responsibility;
(i) For any liabilities relating to the charging order secured against the property relating to arrears of service charge.
(ii) Able [sic] to pay all outgoings on the property including the service charge and any further arrears thereon"
The order itself (which would have become effective on the granting of decree absolute) provided, amongst other things, for the husband to transfer absolutely to the Respondent all his legal estate and beneficial interest in the home on or before 3 May 2007.
Housing costs under the income support scheme
"(e) any amounts determined in accordance with Schedule 3 (housing costs) which may be applicable to him in respect of mortgage interest payments or such other housing costs as are prescribed in that Schedule."
"1. Housing Costs
(1) Subject to the following provisions of this Schedule, the housing costs applicable to a claimant are those costs—
(a) which he or, where he is a member of a family, he or any member of that family is, in accordance with paragraph 2, liable to meet in respect of the dwelling occupied as the home which he or any other member of his family is treated as occupying, and
(b) which qualify under paragraphs 15 to 17.
(2) In this Schedule—
"housing costs" means those costs to which subparagraph (1) refers;... "
"2. Circumstances in which a person is liable to meet housing costs
(1) A person is liable to meet housing costs where—
(a) the liability falls upon him or his partner but not where the liability is to a member of the same household as the person on whom the liability falls;
(b) because the person liable to meet the housing costs is not meeting them, the claimant has to meet those costs in order to continue to live in the dwelling occupied as the home and it is reasonable in all the circumstances to treat the claimant as liable to meet those costs;
(c) he in practice shares the housing costs with other members of the household none of whom are close relatives either of the claimant or his partner, and
(i) one or more of those members is liable to meet those costs, and
(ii) it is reasonable in the circumstances to treat him as sharing responsibility."
"IS. Loans on residential property
(1) A loan qualifies under this paragraph where the loan was taken out to defray monies applied for any of the following purposes—
(a) acquiring an interest in the dwelling occupied as the home; or(b) paying off another loan to the extent that the other loan would have qualified under head (a) above had the loan not been paid off.
(2) For the purposes of this paragraph, references to a loan include also a reference to money borrowed under a hire purchase agreement for any purpose specified in heads (a) and (b) of sub-paragraph (1) above.
(3) Where a loan is applied only in part for the purposes specified in heads (a) and (b) of sub-paragraph (1), only that portion of the loan which is applied for that purpose shall qualify under this paragraph."
"4. Housing costs not met
(2) Subject to the following provisions of this paragraph, loans which, apart from this paragraph, qualify under paragraph 15 shall not so qualify where the loan was incurred during the relevant period and was incurred—(a) after 1st October 1995,
(4) The "relevant period" for the purposes of this paragraph is any period during which the person to whom the loan was made-—(a) is entitled to income support or income-related employment and support allowance, or(b) is living as a member of a family one of whom is entitled to income support or income-related employment and support allowance,
together with any linked period, that is to say a period falling between two such periods of entitlement to income support [or income-related employment and support allowance] separated by not more than 26 weeks
(6) Where the loan to which sub-paragraph (2) refers has been applied—(a) for paying off an earlier loan, and that earlier loan qualified under paragraph 15 during the relevant period; or
(b) to finance the purchase of a property where an earlier loan, which qualified under paragraph 15 or 16 during the relevant period in respect of another property, is paid off (in whole or in part) with monies received from the sale of that property;
then the amount of the loan to which sub-paragraph (2) applies is the amount (if any) by which the new loan exceeds the earlier loan "
I have included paragraph 4(6) not because it is directly in point in this appeal but because it features in one of the authorities upon which the Respondent places reliance and to which I will come in due course.
"19. The crucial part of the ratio is the fact that where the claimant was acquiring an interest in the subject property, it does not so much matter as to how the figures are made up or what they are based upon, but rather the fact that an interest is being acquired is crucial and thus the scenario comes within paragraph 15(l)(a) of Schedule 3 to the Regulations.
20. And so here, the Respondent was acquiring an interest in the Property by reason of her taking over responsibility for a loan and as such it does not matter that this loan was not taken out for a purpose which would ordinarily fall outside the relevant purposes of paragraph 15."
The President of the Queen's Bench Division: