SEML-v-Department for Social Development (ESA) [2016] NICom 7
Decision No: C21/15-16(ESA)
SOCIAL SECURITY ADMINISTRATION (NORTHERN IRELAND) ACT 1992
SOCIAL SECURITY (NORTHERN IRELAND) ORDER 1998
EMPLOYMENT AND SUPPORT ALLOWANCE
Application by the claimant for leave to appeal
and appeal to a Social Security Commissioner
on a question of law from a Tribunal's decision
dated 14 February 2014
DECISION OF THE SOCIAL SECURITY COMMISSIONER
1. I grant leave to appeal and proceed to determine all questions arising thereon as though they arose on appeal.
2. The decision of the appeal tribunal dated 14 February 2014 is in error of law. The error of law identified will be explained in more detail below.
3. Pursuant to the powers conferred on me by Article 15(8) of the Social Security (Northern Ireland) Order 1998, I set aside the decision appealed against.
4. I am able to exercise the power conferred on me by Article 15(8)(a)(ii) of the Social Security (Northern Ireland) Order 1998 to give the decision which I consider the appeal tribunal should have given.
5. My decision is that the appellant is entitled to employment and support allowance (ESA) from and including 9 April 2013.
Background
6. The applicant made an application to ESA from and including 9 April 2013. On 15 April 2013 a decision-maker of the Department decided that the applicant was not entitled to ESA from and including 9 April 2013. An appeal against the decision dated 15 April 2013 was received in the Department on 12 August 2013. The appeal was received outside of the prescribed time-limits for making an appeal but those time-limits were extended by the Department so as to allow the appeal to be made.
7. The substantive appeal tribunal hearing took place on 14 February 2014. The applicant was present and was represented. There was no Departmental presenting officer present. The appeal tribunal disallowed the appeal and issued a Decision Notice in the following terms:
'The appellant is not entitled to ESA (Contribution Based) from 9/14/13 as she had not paid or been credited with the relevant National Insurance Contributions for the two tax years ending 5 th April 2010 to 5 th April 2012.
The arrears of contributions were paid on 11/6/13. Therefore, they were not on time and HMRC will not treat them as on time. Consequently, a 42 day penalty applied. There is entitlement to ESA (Contribution Based) from 23/7/13 being the 43 rd day after payment. This is subject to a valid claim being made.
Appeal dismissed.'
8. On 26 August 2014 an application for leave to appeal to the Social Security Commissioner was received in The Appeals Service (TAS). The application for leave to appeal was received outside of the prescribed time-limits for making such an application. On 30 September 2014 the Legally Qualified Panel Member (LQPM) of the appeal tribunal determined that the application for leave to appeal was outside of the prescribed time-limits but accepted that special reasons existed for the extension of time-limits. On the same date, the LQPM also refused leave to appeal.
Proceedings before the Social Security Commissioner
9. On 15 October 2014 a further application for leave to appeal was received in the Office of the Social Security Commissioners. On 10 November 2014 written observations on the application for leave to appeal were sought from the Decision Making Services (DMS). In written observations received on 27 November 2014, Mr Toner, for DMS, opposed the application for leave to appeal. Written observations were shared with the applicant and her representative on 2 December 2014. On 23 December 2014 written observations in reply were received from the applicant's representative. Those observations in reply were shared with Mr Toner on 16 January 2015. On 4 February 2015 further correspondence was received from Mr Toner which was shared with the applicant and her representative on 11 February 2015. On 25 March 2015 I determined that having considered the papers the application could properly be determined without a hearing. The applicant and her representative were given a further opportunity to make additional representations. Further e-mail correspondence was received from the applicant's representative on 13 April 2015.
10. There then followed a delay in the further administration of this file occasioned, firstly, by the relocation of the Office of the Social Security Commissioners and, secondly, by a significant increase in the workload of the Commissioners in the second half of last year. The delay was unavoidable but apologies are extended to the parties to the proceedings.
11. In a further written submission dated 5 January 2016, Mr Kirk, for DMS, set out the following:
'In view of the fact that HMRC are now stating that (the claimant) has paid her national insurance contributions on time I would state that the original Departmental decision dated 15 April 2013 is erroneous in law. I make that statement as the Departmental decision is based upon the conclusion that (the claimant's) NI contributions were paid late. That conclusion is clearly incorrect given the information that is now available.
In addition I would respectfully state that the tribunal decision dated 14 February 2014 is erroneous as it is also based upon the conclusion that (the claimant's) contributions had not been paid on time. The tribunal decision was based upon the information that was available at that time however it has now transpired that that information was incorrect and did not reflect the true situation regarding (the claimant's) NI contributions.
In view of that I would resile from DMS's original submission dated 27 November 2014 and the further submission dated 4 February 2015 and state that the tribunal has inadvertently erred in law and DMS would now support the application for leave to appeal.'
12. Mr Kirk, in further e-mail correspondence dated 8 January 2016, submitted that I should exercise the power conferred on me by Article 15(8)(a)(ii) of the Social Security (Northern Ireland) Order 1998 to give the decision which I consider the appeal tribunal should have given. Mr Kirk submitted that the decision which the appeal tribunal should have given was that the appellant is entitled to ESA from and including 9 April 2013.
Errors of law
13. A decision of an appeal tribunal may only be set aside by a Social Security Commissioner on the basis that it is in error of law. What is an error of law?
14. In R(I) 2/06 and CSDLA/500/2007, Tribunals of Commissioners in Great Britain have referred to the judgment of the Court of Appeal for England and Wales in R(Iran) v Secretary of State for the Home Department ([2005] EWCA Civ 982), outlining examples of commonly encountered errors of law in terms that can apply equally to appellate legal tribunals. As set out at paragraph 30 of R(I) 2/06 these are:
"(i) making perverse or irrational findings on a matter or matters that were material to the outcome ('material matters');
(ii) failing to give reasons or any adequate reasons for findings on material matters;
(iii) failing to take into account and/or resolve conflicts of fact or opinion on material matters;
(iv) giving weight to immaterial matters;
(v) making a material misdirection of law on any material matter;
(vi) committing or permitting a procedural or other irregularity capable of making a material difference to the outcome or the fairness of proceedings; ...
Each of these grounds for detecting any error of law contains the word 'material' (or 'immaterial'). Errors of law of which it can be said that they would have made no difference to the outcome do not matter."
The relevant legislative background
15. Section 1(2)(a) of Welfare Reform Act (Northern Ireland) 2007 ('the 2007 Act') provides that:
'... (2) Subject to the provisions of this Part, a claimant is entitled to an employment and support allowance if he satisfies the basic conditions and either—
(a) the first and the second conditions set out in Part 1 of Schedule 1 (conditions relating to national insurance) ...
Paragraph 2 of Part 1 of Schedule 1 to the 2007 Act provides for the second contribution condition for ESA as follows:
'2.-(1) The second condition is that -
(a) the claimant has in respect of the last two complete tax years before the beginning of the relevant benefit year either paid or been credited with Class 1 or Class 2 contributions or been credited with earnings, and
(b) the earnings factor derived as mentioned in sub-paragraph (2) must be not less in each of those years than the year's lower earnings limit multiplied by 50.
(2) The earnings factor referred to in sub-paragraph (1)(b) is the aggregate of the claimant's earnings factors derived -
(a) from so much of his earnings as did not exceed the upper earnings limit for the year and upon which primary Class 1 contributions have been paid or treated as paid or from earnings credited, and
(b) from Class 2 contributions.
Paragraph 3(1) of the Part 1 of Schedule 1 to the 2007 Act provides the following definitions in sub-paragraphs (a) and (f):
(a)"benefit year" means a period which is a benefit year for the purposes of Part 2 of the Contributions and Benefits Act or such other period as may be prescribed for the purposes of this Part of this Schedule;
(b)"relevant benefit year" is the benefit year which includes the beginning of the period of limited capability for work which includes the relevant benefit week;
Section 21(6) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 ('the 1992 Act') provides:
'(6) In this Part of the Act "benefit year" means a period -
(a) beginning with the first Sunday in January in any calendar year, and
(b) ending with the Saturday immediately preceding the first Sunday in January in the following calendar year;'
Regulation 2(1) of the Employment and Support Allowance Regulations (Northern Ireland) 2008 ('the 2008 Regulations') provides:
'"benefit week" means a period of 7 days'
Article 7(1) of the Social Security Contributions (Transfer of Functions, etc.) (Northern Ireland) Order 1999 provides -
'7. - (1) Subject to the provisions of this Part, it shall be for an officer of the *Board -
...
(c) to decide whether a person is or was liable to pay contributions of any particular class and, if so, the amount he is or was liable to pay,
(d) to decide whether a person is or was entitled to pay contributions of any particular class that he is or was not liable to pay and, if so, the amount that he is or was entitled to pay,
(e) to decide whether contributions of a particular class have been paid in respect of any period,'
Under article 2 'Board' means the 'Commissioners of Inland Revenue'.
Regulation 4(8) of the Social Security (Crediting) and Treatment of Contributions, and National Insurance Numbers) Regulations (NI) 2001 provides:
'(8) For the purpose of determining whether the second contribution condition for entitlement to a ..... contributory employment and support allowance is satisfied in whole or in part, any relevant contribution shall be treated -
(a) if paid before the beginning of the relevant benefit year, as paid on the due date;
(b) if paid after the end of the benefit year immediately preceding the relevant benefit year, as not paid in relation to the benefit claimed in respect of any day before the expiry of a period of 42 days (including Sundays) commencing with the date on which that contribution is made, and, subject to the provisions of paragraph (2)(a) and (3)(a), as paid at the expiry of that period in relation to entitlement to such benefit in respect of any other period.'
Article 13(8) of the Social Security (Northern Ireland) Order 1998 ('the 1998 Order) provides:
'(8) In deciding an appeal under this Article, an appeal tribunal -
(a) ...
(b) shall not take into account any circumstance not obtaining at the time when the decision appealed against was made.'
What did the appeal tribunal decide?
16. The appeal tribunal produced a comprehensive statement of reasons for its decision. The appeal tribunal's conclusions on the issues arising in the appeal are to be found in paragraph 16:
'I can appreciate, albeit with hindsight, the appellant has a sense of grievance. However, in determining her appeal I have no jurisdiction over what might have been or why these events occurred. I am restricted to examining the basic facts. Firstly, it is not disputed that the necessary contributions were not paid at the time. The contributions have since been paid. Thereafter, there is a 42 day penalty. There is no dispute of the 42 day calculation from the date the arrears were paid. My task is to see that the respondent has applied the legislation correctly. My conclusion is they have. Understandably the appellant will be disappointed by this outcome. However, I do not have a discretion on this issue but must decide if this decision is in accordance with the law, which I find it is.'
Analysis
17. I accept that it is now clear that the decision which was made by the Department on 15 April 2013 and which was confirmed by the appeal tribunal on 14 February 2014 was made on an inadvertent basis and was, accordingly, in error of law. As has been submitted by Mr Toner, the Departmental and appeal tribunal decisions were based on information which was available at the time when those decisions were made. It is now apparent that the information was incorrect and did not reflect the accurate position in respect of the appellant's National Insurance contributions.
18. The inevitable outcome is that the appeal must be allowed.
Disposal
19. The decision of the appeal tribunal dated 14 February 2014 is in error of law.
20. Pursuant to the powers conferred on me by Article 15(8) of the Social Security (Northern Ireland) Order 1998, I set aside the decision appealed against.
21. I am able to exercise the power conferred on me by Article 15(8)(a)(ii) of the Social Security (Northern Ireland) Order 1998 to give the decision which I consider the appeal tribunal should have given.
22. My decision is that the appellant is entitled to ESA from and including 9 April 2013.
(signed)
Kenneth Mullan
Chief Commissioner
15 January 2016