UK Social Security and Child Support Commissioners' Decisions

[1991] UKSSCSC CIS_124_1990 (11 February 1991)

DGR/SH/ts/7

Commissioner's File: CIS/124/1990

SOCIAL SECURITY ACT 1986

APPEAL FROM DECISION OF SOCIAL SECURITY APPEAL TRIBUNAL ON A

QUESTION OF LAW

DECISION OF THE SOCIAL SECURITY COMMISSIONER

1. My decision is that the decision of the social security appeal tribunal of 12 July 1989 is erroneous in point of law, and accordingly I set it aside. I direct that the appeal be reheard by a differently constituted tribunal who will have regard to the matters mentioned below.
2. This is an appeal by the claimant, brought with the leave of the tribunal chairman, against the decision of the social security appeal tribunal of 12 July 1989. I directed an oral hearing. At that hearing the claimant, who was not present, was represented by Mr Mark Rowland of Counsel, whilst the adjudication officer appeared by Mr M R Parke of the Solicitor's Office of the Departments of Health and Social Security. I am indebted to both of them for their assistance.
3. On 17 January 1989 the adjudication officer decided that the claimant was not entitled to income support from 5 July 1988 because she had to be treated as being in possession of the sum of E8,740.52, being a half share of the proceeds of the sale of her home. As that sum exceeded the maximum statutory figure, she was barred from entitlement to income support. The home was an ex-Council house, which in May 1983 the claimant had by virtue of her tenancy purchased on favourable terms. From that date the claimant was treated, for the purposes of her claim to supplementary benefit, as a joint owner-occupier with her son Lakhansi, and was allowed, as part of her benefit, half the mortgage interest payable. On 30 August 1988 a letter was received from the claimant stating that the property owned by her son and herself had now been sold to another son. However, the claimant continued to reside there. The proceeds of sale amounted to £.17,481.04, and these were passed in their entirety to Lakhansi. In the light of that, on 17 January 1989 the adjudication officer regarded the claimant as having received £8,740.52, and as having divested herself of that sum in favour of Lakhansi for the purposes of claiming income support. She was therefore caught by regulation 51 (1) of the Income Support (General) Regulations 1987, [S.I. 1987 no. 1967] which provides as follows "The claimant shall be treated as possessing capital of which he has deprived himself for the purposes of seeking entitlement to income support or increasing the amount of that benefit..." As the claimant had notional capital in excess of the statutory maximum of £6,000, she was not entitled to income support.
4. In due course, the claimant appealed to the tribunal who by a majority upheld the decision of the adjudication officer. Immediately before the hearing, the claimant handed up written submissions, in which it was contended that the claimant had no beneficial interest in the property, or alternatively if she did, that such interest was limited to one-third. Unfortunately, the tribunal did not deal with these contentions, and the claimant has been left in the dark as to why they did not succeed. It follows that I must necessarily set as the tribunal's decision as being erroneous in point of law, and direct that the appeal be reheard by a differently constituted tribunal.
5. However, in the course of their decision the tribunal ventilated certain issues which are of general significance in cases of the present kind, and accordingly I issued a Direction stating that I required, at the oral hearing, submissions on, inter alia, the following issues:

   "(1) Can someone who is 'illiterate and speaks and understands only Gujarati' be in a better position for income support purposes than someone who can read and write and is familiar with the English language?

   (2) If a person ought to have known of the capital limit, does this satisfy the 'intention' requirement of regulation 51(1) of the Income Support (General) Regulations 1987?

   (3) Does the failure to make proper enquiries as to the capital limit constitute, without more, an intention to secure supplementary benefit within regulation 51(1)?"

   It seemed that the tribunal had proceeded on the basis that the answers to these questions were respectively "no", "yes" and "yes". Accordingly, I thought that it was crucial that these matters should be resolved so that if, as has proved the case, a new tribunal were required to rehear the appeal, such tribunal might receive proper guidance.

6. As regards the first question, Mr Rowland and Mr Parke said that the answer was to be found in paragraph 5 of Decision R(G) 1/75:-

5. The claimant understands very little English and relies on her husband who also relies on the help of friends. Language difficulty is a factor in the case. I would not regard difficulty over a language as in itself good cause for a delayed claim. Persons who are claiming, or receiving social security benefit should be diligent in seeking and obtaining interpretation of language and proper advice and it is not sufficient merely to rely on ignorance of language any more than it is good cause to prove, in the absence of any other relevant factors, merely illiteracy or ignorance of statutory provisions. Difficulty in communication, on the other hand, might in certain circumstances amount to good cause but there again steps should be taken to make matters clear (compare Decision C.S.100/49(K))."

Clearly, the Commissioner in that case took the view that a claimant cannot pray in aid illiteracy or unfamiliarity with the English language as justification for a late claim. Adopting this principle more widely, ignorance of the law, and more specifically ignorance of the statutory capital limit, is no more an excuse for someone who is illiterate and unfamiliar with the English language than it is for someone not suffering from those handicaps. The only concession that can be made is that, in certain circumstances, the claimant might be excused the consequences of a misunderstanding arising out of difficulty in communication. I can readily see that, if a claimant with no or insufficient command of English, diligently seeks, through the aid of an interpreter, to learn from the local office the meaning of the relevant statutory provisions, and in the course of communicating advice through an interpreter some error is made, the claimant should not be penalised on that account. In short, I agree with the observations of the Commissioner in R(G) 1/75 subject to the proviso mentioned above, so that a person illiterate and unfamiliar with the English language is in no better a position, and, of course, in no worse a position, than someone who is not illiterate and whose native tongue is English. On this point, the tribunal did not err in point of law.

7. The second and third questions posed above are really interconnected,. For failure to make proper enquiries as to the capital limit, where a claimant is unfamiliar with it, is a ground for saying that the claimant ought to have known of such limit. Question 2 is general; question 3 is specific. However, as far as the answer is concerned, the same principles apply. It is important to remember that these two questions only arise where the claimant did not actually know of the capital limit. In the present case, the tribunal were equivocal as to whether or not they accepted that the claimant knew of the capital limit. They seem to have proceeded on the basis that it did not matter. If she did not know, she ought to have known; and that was enough.
8. Mr Parke was inclined, initially, to contend that, if a claimant, who was unaware of the capital limit, failed to make proper enquiry on this matter, then he would be caught by regulation 51(1). A person who chose to remain in ignorance on
a crucial issue should not be in a better situation than someone who took the trouble to enquire as to what the legal position was. I see the moral force of that. Public funds are involved, and it could well be said that the general body of taxpayers might feel it an affront that people who have capital resources in excess of the statutory maximum can escape the consequences of regulation 51(1) by the simple expedient of deliberately failing to make the appropriate enquiries. Mr Rowland, while, I think, accepting the moral force of this view, contended that I was only concerned with the strict language of the regulation, and further submitted that, as a policy, the regulation had been framed so as not to prejudice claimants who, out of sheer ignorance or some other inadequacy, divested themselves of property without realising the serious consequences of their action to their benefit. It was one thing for a person who knew the capital limit rules to pass over property with the consequences that necessarily followed; it was quite another for someone who did not realise what would ensue, and therefore did not make a deliberate choice.
9. Mr Rowland contended that the crucial words in regulation 51 were "for the purposes of securing supplementary benefit", and a person could not deprive himself of a resource for the purposes of securing supplementary benefit without first knowing the capital limit provision. Without such knowledge the relevant intention could never have been formulated. Therefore, if a person made no enquiry, although he ought to have done, he was not caught by regulation 51(1), the reason being that in the circumstances he simply could not have formed the requisite intention. I believe that Mr Parke, albeit with some reluctance, was constrained to accept the validity of this argument.
10. I think that Mr Rowland was right. Accordingly, if in the present case the effect of the gift to her son was to bring the claimant's capital resources below the statutory maximum, so that she prima fascia became entitled to income support, this was simply the natural consequence of her action, but it did not follow that she made the gift "for the purposes of securing supplementary benefit". In other words, there had to be a deliberate intention on her part to obtain benefit; it was not enough that it was an accidental consequence of the divesting. And for there to be a deliberate intention a claimant had to be aware of the capital limit rule. It was not enough, if regulation 51(1) was to apply, that the claimant ought to have known of such rule. More specifically, the failure to make proper enquiries as to the capital limit did not constitute an intention to secure income support. Accordingly, in so far as the tribunal in the present case reached their decision, not on the basis that the claimant knew of the capital limit, but that, by virtue of her failure to make proper enquiries, she ought to have known, they erred in point of law. I must therefore set aside their decision on that ground as well as that referred to in paragraph 4, and I must direct that the appeal be reheard by a differently constituted tribunal.
11. It follows from what has been said above that the new tribunal must first decide, having made appropriate findings of fact, the extent, if at all, to which the claimant had a beneficial interest in the proceeds of sale of the house, and if they consider that she had some interest, they must quantify it. If they are persuaded she had an interest, so quantified, they must consider whether, in divesting herself thereof in favour of her son, she did so for the purposes of obtaining income support. There can be no question of regulation 51(1) applying unless they are satisfied that the claimant knew, as distinct from ought to have known, the capital limit. Whether she knew will depend upon the tribunal's finding as to the facts, and in considering this issue, they will have regard to the claimant's whole background, including her experience of the social security scheme, and the advice that she was likely to have received from her family and elsewhere. If the tribunal are satisfied that the claimant knew of the capital limit they will then go on to decide whether she is caught by regulation 51(1), and if she is so caught, whether the capital resources, of which she is treated as possessed, exceed the statutory maximum, with the result that she is precluded from receiving income support.
12. I allow this appeal.

    (Signed) D G Rice Commissioner

    (Date) 11 February 1991

    SUPPLEMENTARY BENEFITS ACT 1976

    THE SOCIAL SECURITY COMMISSIONERS PROCEDURE REGULATIONS 1987 REGULATIONS 24(1)

    APPEAL FROM DECISION OF SOCIAL SECURITY APPEAL TRIBUNAL ON A QUESTION OF LAW

    DECISION OF THE SOCIAL SECURITY COMMISSIONER - CORRECTION

    Name: Rudibai Rama (Mrs)

    Social Security Case No: 415:06351	Appeal	Tribunal:	Leicester
    Paragraph 5	Line 16	delete	'supplementary benefit' and
    		insert	'income support'
    Paragraph 9	Line 2	delete	'supplementary benefit' and
    		insert	'income support'
    Paragraph 9	Line 4	delete	'supplementary benefit' and
    		insert	'income support'
    Paragraph 10	Line 7	delete	'supplementary benefit' and
    		insert	'income support'

    (Signed) D.G. Rice Commissioner

    (Date) 15 March 1991

    Commissioner's File: CIS/124/1990