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[1992] UKSSCSC CFC_16_1991 (16 December 1992)

R(FC) 2/93

Mr. V. G. H. Hallett CFC/16/1991
16.12.92

Presence condition - claimant's partner's earnings derived from remunerative work outside the United Kingdom - whether claimant to be treated as not being in Great Britain

The claimant claimed family credit on 3 January 1990. On that date she and her husband were present in Great Britain. She was not, but her husband was in remunerative employment in Algeria from where his earnings were wholly derived. The adjudication officer decided that she was not entitled to family credit because none of the claimant's earnings nor her partner's earnings came from remunerative work in the United Kingdom. She then made a claim for income support. The adjudication officer disallowed the claim. Her appeal was disallowed by the tribunal on the ground that her husband was her partner and he was in remunerative employment. The tribunal advised her to appeal against the adjudication officer's decision disallowing family credit. She asked for a review of the family credit decision. The adjudication officer refused to review as he was satisfied that there was no ground for review. On appeal the tribunal, by a majority, confirmed the decision. On further appeal to the Commissioner she contended that regulation 3 of the Family Credit (General) Regulations did not apply to her because on its true construction it is the limited category in paragraph (2) which is deemed not to be present; the opening phrase in paragraph (1) "if" not "if but only if" indicates that it is not concerned with deeming presence but actual presence in Great Britain on a straightforward factual basis.

Held that:

the first condition in regulation 3(1) is that the claimant is to be present in Great Britain. If a person who is present in Great Britain does not need to rely on that regulation in order to qualify as being "in Great Britain" for the purpose of entitlement to family credit, that regulation has no function at all. It can never apply;

the provisions of section 20(12)(a) of the Social Security Act 1986 support the view that the regulations made thereunder were intended to define the circumstances in which a person was to be treated as in Great Britain and that any person who did not satisfy those requirements should not be regarded as in Great Britain;

regulation 3(1) is not a "deeming provision" additional to, and in no way derogating from, a primary qualification of being "in" Great Britain. If that were right, merely physical presence on that day would suffice: of Reg v. Home Secretary ex p. Mughal [1974] QB 313. Once that has been established, it would be necessary to invoke regulation 3(l) and its provisions would be entirely ineffective and useless. These difficulties do not arise if regulation 3 is construed as laying down the conditions to be complied with before a claimant can be treated as being in Great Britain at the date of claim and without such compliance must be treated as not in Great Britain whether or not he was in fact physically present there on that date.

The appeal was refused.

DECISION OF THE SOCIAL SECURITY COMMISSIONER

Decision

This claimant's appeal fails. My decision is that the decision of the social security appeal tribunal dated 15 October 1990 is not erroneous in law. If, however, it is erroneous in law I set it aside and my own decision is to the same effect for the reasons set out below.

Representation

I held an oral hearing of this appeal. The claimant, who did not appear, was represented by Mr. Andrew Balchin, senior welfare rights officer of the City of Salford Benefit Advice Shop; the adjudication officer was represented by Mr. R. Butt of the Solicitor's Office, Departments of Health and Social Security.

Nature of the appeal

This appeal relates to family credit. At the date of claim (3 January 1990) the claimant and her husband were present in Great Britain. The husband was in remunerative work outside the United Kingdom (namely in Algeria) from where his earnings were wholly derived. The claimant was not in remunerative work at all. These are the only relevant facts and they are not in dispute.

The question of law in this appeal is whether a person is only "in Great Britain" in terms of section 20(5) of the Social Security Act 1986 (since re-enacted in section 128(1) of the Social Security Contributions and Benefits Act 1992) if he or she satisfies the requirements of regulation 3(1) of the Family Credit (General) Regulations 1987. If the answer to this question is "Yes", the claimant did not satisfy an essential condition of entitlement to family credit, namely that she is "in Great Britain"; see paragraph (c) of regulation 3(1).

The relevant law

Section 20(5) of the Act as far as it was relevant provided that:

" … a person in Great Britain is entitled to family credit if, when the claim for it is made …"

Section 20(12)(a) of the Act provided that:

"Regulations may make provision for the purposes of this Part of the Act -

(a) as to circumstances in which a person is to be treated as being or not being in Great Britain."

Regulation 3(1) of the General Regulations provides that:

"3.-(1) A person shall be treated as being in Great Britain if, on the date of claim -

(a) he is present and ordinarily resident in Great Britain; and

(b) his partner, if any, is ordinarily resident in the United Kingdom; and

(c) his earnings or the earnings of his partner, if any, derive at least in part from remunerative work in the United Kingdom; and

(d) his earnings do not wholly derive from remunerative work outside the United Kingdom nor do the earnings of his partner, if any."

Regulation 3(2) provides:

"A person shall be treated as not being in Great Britain during any period for which he, or his partner, is entitled to be paid family credit under the law of Northern Ireland."

The decision on the claim

The claim for family credit (received 3 January 1990) was rejected by an adjudication officer's decision issued on 9 January 1990 in the following terms:

"The claimant was not entitled to family credit on the date of claim, 3 January 1990, because none of the claimant's nor the claimant's partner's earnings came from remunerative work in the United Kingdom.

Social Security Act 1986 Section 20(5). Family Credit (General) Regulations, regulation 3(1)(c)."

The decision on the request for review

The claimant asked for that decision to be reviewed. On 4 July 1990 an adjudication officer issued a decision refusing to review, which was in these terms:

"I refuse to review the decision of the adjudication officer because I am not satisfied that the decision was given in ignorance of or was based on a mistake as to some material fact.

The decision was not erroneous in point of law.

Social Security Act 1975, Section 104. Social Security Act 1986, section 53."

The claimant appealed against that decision to a social security appeal tribunal.

The appeal tribunal's decision

The appeal tribunal heard the appeal on 15 October 1990. The claimant did not appear. Mr. Balchin represented the claimant. The chairman's note of evidence, and the tribunal's recorded findings of fact, decision and reasons for decision are set out in the appendix.

Was the appeal tribunal's decision erroneous in law?

Mr. Balchin submits that it was because (1) the tribunal did not explain which part of paragraph 3 of the General Regulations was not satisfied (2) they were in error in stating that the claimant needed to satisfy the conditions of regulation 3 and (3) there is an erroneous reference to the Income Support (General) Regulations in the text of their decision. The relevant regulations were the Family Credit (General) Regulations. Mr. Butt agrees that the decision is erroneous in law, considering that the record of their decision is not adequate to comply with regulation 25(2)(b) of the 1986 Adjudication Regulations.

There is nothing in the first and third points. The appeal tribunal found that the decision of the adjudication officer refusing family credit was not erroneous in law. The decision of the adjudication officer was that the claimant was not entitled to family credit on the date of claim 3 January 1990 because "none of the claimant's nor the claimant's partner's earnings came from remunerative work in the United Kingdom". The authority for the decision was given as section 20(5) of the 1986 Act and regulation 3(1)(c) of the Family Credit (General) Regulations. The record of the tribunal's decision must be read with the decision of the adjudication officer refusing family credit to which their decision expressly refers and, if it is, it is quite clear that paragraph (1)(c) of regulation 3 was that relied on: see paragraph 6 above. The reference to the Income Support (General) Regulations is an obvious error for Family Credit (General) Regulations. I do not consider that anyone is left guessing as to what the material facts were nor why the majority of the tribunal considered that the appeal from the adjudication officer's refusal to review should be dismissed. The findings of fact were in my view, just, and the reasons for decision were, in my view, clearly, sufficient to comply with the requirements of regulation 25(2)(b) of the 1986 Regulations which required the material facts to be recorded and reasons for decision given.

The real issue is whether the appeal tribunal were in error in stating that the claimant needed to satisfy the conditions of regulation 3.

(1) The background to the position taken up by the claimant, which is that regulation 3 does not apply to her because she was actually present in Great Britain at the date of claim, is this. The claimant originally applied for income support. This claim was disallowed by an adjudication officer and the claimant appealed to a social security appeal tribunal. That tribunal disallowed the appeal on the ground that her husband was her partner and he was in remunerative employment. In giving reasons for their decision, which was unanimous, the record concludes:

"In our view, Mrs. L's best course of action is to appeal against the family credit decision and we repeat our advice to her to do so as soon as possible. Under Section 20(5) a person in Great Britain is entitled to family credit if the claimant or partner is in remunerative work, there are children, and income is below the crucial level. Mrs. L appears to meet these conditions. She therefore does not need the assistance of regulation 3(1) of the Family Credit (General) Regulations. She was actually in Great Britain at the date of claim. Regulation 3(1) provides for a person to be treated as in Great Britain if four conditions are satisfied. Mrs. L does not need to be treated as in Great Britain. Her failure to satisfy all four conditions in regulation 3(1) is therefore irrelevant. Paragraph 1 of Schedule 1 to those regulations earnings payable outside the United Kingdom in a country where there is a prohibition on transfer to the United Kingdom are disregarded."

Note: The same view is expressed in Mr. Mesher's valuable book on income support, in the following terms at page 303 (1992 Edition):

"The requirement for the claimant to be in Great Britain at the date of claim appears in section 128(1) of the Contributions and Benefits Act (1986 Act section 20(5)). By section 137(2) (1986 Act, section 20(12)(a)) regulations may provide for the circumstances in which a person is to be treated as being or not being in Great Britain.

Paragraph (1) The form of this provision is peculiar. It sets out a composite sufficient condition for treating a person as being in Great Britain. But the opening phrase is "if", not "if and only if" (or even "only if"), it appears to remain open to a person to show actual presence in Great Britain on a straightforward factual basis. It is only the limited category of paragraph (2) which is deemed not to be present. Therefore the elaborate conditions in sub-paras. (a) to (d) are something of a waste of time, unless the incorporation of "presence" in sub-paragraph (a) indicates the contrary ...

The presence of the claimant is a matter of fact. If my argument above is correct once a claimant has shown this, he does not need the deeming provisions of paragraph (1)."

[There is a similar passage in all previous editions of the book, including the 1989 edition, which is that current when the dissenting member of the tribunal referred to it.]

(2) Mr. Balchin adopted this argument.

The first and decisive objection to this argument, in my judgment, is that the first condition in regulation 3(1) is that the claimant is to be present and ordinarily resident in Great Britain. If a person who is present in Great Britain does not need to rely on regulation 3(1) in order to qualify as being "in Great Britain" for the purpose of entitlement to family credit, regulation 3(1) has no function at all. It can never apply.

The provisions of section 20(12)(a) support the view that the regulations made thereunder were intended to define the circumstances in which a person was to be treated as in Great Britain and that any person who did not satisfy those requirements should not be regarded as in Great Britain.

Mr. Balchin gallantly submitted that regulation 3(1) might have a purpose in a case where, for example, the claimant and her husband were in the same household in Algeria (Mr. Mesher's tribunal had found the instant claimant and her husband were in the same household in England). I cannot accept that this regulation would assist her being treated as in England if she were not. Mr. Balchin drew attention to regulation 3(2), which prevents anyone entitled to family credit in Northern Ireland from obtaining that benefit in Great Britain as well. This does not assist his argument. It supports the conclusion that I have arrived at which is that regulation 3 is intended to be an exhaustive definition as to the circumstances in which a person is or is not "in Great Britain" for the purpose of section 20(5).

Such a definition operates to exclude the temporary visit and to avoid the question whether a person is "in" a country that arises in social security cases where residence or presence is in issue e.g. where there is a reciprocal agreement in force. For an immigration example see Reg v. Home Secretary ex p. Mughal [1974] QB 313, where a question of construction arose as to whether the applicant was "in" the United Kingdom on a particular day. (It was held he was not. He was in Pakistan).

I cannot agree with the suggestion that regulation 3(1) is a "deeming" provision additional to, and in no way derogating from, a primary qualification of being "in" Great Britain at the date of claim. If that were right, merely physical presence on that day would suffice: cf. Mughals case at page 323C, 326D and 330 letters D and E. Once that had been established, it would not be necessary to invoke regulation 3(1) and its provisions would be entirely ineffective and useless. These difficulties do not arise if regulation 3 is construed, as in my judgment it must, as laying down the conditions to be complied with before a claimant can be treated as being in Great Britain at the date of claim and without such compliance must be treated as not in Great Britain whether or not he was in fact physically present there on that date.

My decision is set out in paragraph 1.

Date: 16 December 1992 (signed) Mr. V. G. H. Hallett Commissioner

APPENDIX

(see para. 8)

The record of the appeal tribunal's decision of 15 October 1990

Part 1

The chairman's note states:

"In this case there was apparently no argument about the facts and the adjudication officer and Mr. Balchin put forward different interpretations of how Mrs. L could be entitled to family credit having regard to Section 20(5) of the Social Security Act 1986, Section 20(12) and regulation 3 of the Family Credit (General) Regulations 1987.

Miss Dale, the adjudication officer said that subsection 12 placed a qualification on entitlement described in subsection 5 which was further defined and therefore qualification had to be established with regard to regulation 3. The footnote in Mesher admits of a contract argument and this was this that was adopted by Mr. Balchin because that argument had been suggested as one to put forward by a previous tribunal when dismissing an appeal against the claimant's claim for income support."

Part 2

The tribunal's decision was:

"The decision of the adjudication officer refusing family credit is not to be reviewed because the decision was not erroneous in point of law and the claimant is not entitled to family credit as she fails to satisfy the conditions of regulation 3 of the Income Support (General) Regulations."

Part 3

The tribunal's recorded findings of fact were:

"Mrs. L made a claim for family credit on the 3 January 1990.

On the date of claim Mr. L's permanent home was not in Great Britain and he was employed by an Algerian firm for whom he normally worked 44 hours per week receiving a salary of 6,000 Algerian dinars which are not transferable."

Part 4

The tribunal's recorded reasons for decision were:

"The majority view is that entitlement to family credit derives from section 20(5) of the Social Security Act 1986 which says … a person in Great Britain is entitled to family credit if when the claim is treated to be made his income does not exceed the applicable amount … Section 20(12) provides that regulations may make provision for the purpose of this part of the Act as to circumstances in which a person is to be treated as being or not being in Great Britain. Social security regulation 3(1) of the General Regulations says …

A person shall be treated as being in Great Britain if on the date of claim-

(a) He is present and ordinarily resident in Great Britain; and

(b) His partner, if any, is ordinarily resident in the United Kingdom; and

(c) His earnings, or the earnings of his partner, if any, derive at least in part from remunerative work in the United Kingdom; and

(d) His earnings do not wholly derive from remunerative work outside the United Kingdom nor do any of the earnings, of his partner, if any.

The regulation seeks not to make factual presumptions but clearly presumptions for the purpose of the application of Section 20 of the Act. The entitlement to family credit is defined in Section 20(5) by reference to being in Great Britain and subsection 12 enables regulations to be made to say who is to be treated as being or not being in Great Britain. This admits of the possibility for the purposes of this benefit circumstances in which someone who is actually in Great Britain can be treated as not being so. This is the case by not satisfying the requirements of regulation 3(1) as well as specifically by not being entitled by virtue of the position stated in regulation 3(2).

The minority view was to adopt the argument that Mr. Mesher put forward when chairing the Committee that refused income support which argument is contained in the footnote of "Commentary on Income Support, The Social Fund and Family Credit" and that is to say that paragraph 3(1) is using the words: shall be treated as being in Great Britain "if" rather than the words "if and only if" leaves it open to argue that the qualification can either be by presence or by satisfying regulation 3(1) and its 4 other conditions stated. In his view therefore it leaves open the possibility of making a claim based on the actual basis of presence in Great Britain and renders the other conditions stated in paragraphs (a) to (d) as being superfluous and it is those superfluous requirements only, that the claimant fails to satisfy in this case."