UK Social Security and Child Support Commissioners' Decisions

R(CR) 1/96


Mrs. R. F. M. Heggs CCR/2/1994

13.7.95

Causation - disabled claimant capable of work but paid benefit on the basis that she was not capable of work - whether benefit paid "in consequence of" relevant accident

On 4 March 1989 the "victim" was injured in a road accident. On 12 June 1992 she accepted an offer of £5,500 in settlement of her compensation claim. A certificate of total benefit was issued on 8 July 1992, showing benefit to be recoverable under section 82(1) of the Social Security Administration Act 1992 up to 28 August 1992 (the date when the certificate expired). The victim had been in receipt of income support throughout the period 4 March 1989 to 28 August 1992 but from 25 July 1991 this was on the basis of her availability for work, rather than her incapacity for work.

The "compensator" appealed against the certificate of total benefit. The Secretary of State considered that the appeal raised a medical question and so referred the matter to a medical appeal tribunal for determination. The medical appeal tribunal stated that the victim was still suffering from the effects of the accident but considered that the evidence showed that she was fit for light work by 1 January 1991. The Secretary of State then referred the case to a social security appeal tribunal for determination of the compensator's appeal. The social security appeal tribunal decided that the victim was not incapable of work after 1 January 1991 and was not receiving benefit as a result of her injuries after that date. They therefore allowed the compensator's appeal, deciding that benefit was only repayable up to 1 January 1991. The Secretary of State appealed to the Commissioner.

Held that:

the appeal was clearly concerned with the period specified in the certificate of total benefit on the basis that benefit paid otherwise than in consequence of the accident had been brought into account. It thus fell to be determined solely by a social security appeal tribunal under section 98(7) of the Social Security Administration Act 1992, since no medical question as defined in section 98(12) arose;

the social security appeal tribunal had considered the wrong question. The issue was not the victim's capacity for work but whether benefit had been paid in consequence of the accident. Since the sole cause of the victim's incapacity for work was the injuries she sustained in the accident and that incapacity had been accepted by the Department and income support paid on that basis up to 24 July 1991, it followed that benefit had been paid in consequence of the accident up to that date but not thereafter;

the Commissioner therefore allowed the Secretary of State's appeal in part and substituted her own decision that benefit paid from 25 July 1991 should not have been brought into account.

DECISION OF THE SOCIAL SECURITY COMMISSIONER

1. My decision is that the decision of the social security appeal tribunal given on 7 February 1994 is erroneous in point of law and accordingly I set it aside. However, as I consider it expedient to give the decision the tribunal should have given, I further decide that the certificate of total benefit issued on 8 July 1992 was incorrect because of the period specified and because benefit paid or payable otherwise than in consequence of the accident in question was brought into account on and after 25 July 1991.
2. This is an appeal by the Secretary of State against the decision of the SSAT of 7 February 1994, leave having been granted by the tribunal chairman. At the oral hearing of the appeal held before me, the Secretary of State was represented by Mr. C. Blake of the Solicitor's Office of the Departments of Health and Social Security. The Prudential Assurance Company ("the compensator") was represented by Mr. R. Goodbody, of Counsel instructed by Messrs. Moss Mooneeram. Miss T. J. Daly ("the victim") was advised of the date and time of the oral hearing but did not attend.
3. The facts are not in dispute. On 4 March 1989 the victim, a hairdresser then aged 20, suffered various injuries in a road traffic accident. She claimed compensation from the compensator. On 11 June 1992 a request was received from the compensator's Solicitor for a certificate of total benefit. On 12 June 1992 the victim accepted a payment into Court of £5,500 in settlement of her claim.
4. On 8 July 1992 a certificate of total benefit was issued showing the amount recoverable to 28 August 1992, the date when the certificate expired. On 17 August 1992 a cheque was received from the compensators solicitor calculated on the supposition that as the victim was able to return to work within 18 months of the accident, then the benefits attributable to the accident should be limited to that period. For ease of calculation the compensator's solicitor assumed that the victim was fit for work on 1 January 1991 and he therefore calculated that £3,654.31 was due for recovery in accordance with the Recoupment Regulations. A further certificate of total benefit was issued requesting full repayment of the balance due. On 2 October 1992 a further cheque was received for £2,665.53 together with a request for the matter to be referred to a medical appeal tribunal ("MAT"). As the Secretary of State was satisfied that a medical question arose for determination, he referred that question to a MAT.
5. The victim and the compensator's solicitor attended the hearing of the case before the MAT on 1 March 1993. Surprisingly, the Secretary of State was not represented. The MAT had before them two reports from examining medical officers of the Department ("EMOs") Dr. Lee and Dr. Thomas dated 15 January 1991 and 1 May 1991 respectively, expressing the opinion that the claimant was not capable of work as a hairdresser but was capable of work within certain limits. The MAT also had a medical report dated 29 May 1991 from Mr. H. Thompson, a consultant orthopaedic surgeon, and statements from the claimant's own doctor covering the period in issue.
6. The MAT adopted the clinical findings of Dr. Thompson and Dr. Lee and accepted the victim's evidence. In their decision the MAT answered "yes" to the question "did the victim, as the result of the occurrence suffer any injury, sickness or disease?" and specified "1. fracture right clavicle. 2. fracture right tibia and fibula.
   3. minor cuts and bruises." In answer to the question "for what period, did the victim suffer any injury, sickness or disease?" the MAT answered "l and 2: from the date of the accident and continuing. 3. Not more than one month". The reasons for decision read:

"Whilst not agreeing entirely with Mr. Harral Thompson's conclusion about work as a hairdresser, we would have said that by 1 January 1991 Miss Daly was medically fit for "light work" as evidenced by her then ability to drive and her walking for a reasonable distance without a limp and stand for a reasonable period. She had been discharged from hospital completely three months before.

However, the statute confines us to answering medical questions. We cannot give a decision on incapacity, as Mr. O'Donnell [the compensator's Solicitor] asked us to do. It will now be for the SSAT to consider, in the light of our answers to the medical questions whether they can give such a decision."

7. Thereafter the Secretary of State referred the case to the social security appeal tribunal for determination of the compensator's appeal against the certificate of total benefit. The compensator's Solicitor attended the hearing of the appeal before that tribunal on 7 February 1994. The victim did not attend. The chairman recorded a very full note of evidence. In the light of the medical evidence, the compensator's solicitor argued that by 1 January 1991 the victim was fit for work and "that any benefit paid thereafter would not be attributable to her illness or any subsequent inability to work. It is this question that is now referred to the social security appeal tribunal, the relevant matters having been referred and decided by the medical appeal tribunal. It was conceded that the MAT decision does not carry authority with the SSAT decision but it may be regarded as persuasive only". In the event the SSAT allowed the appeal. The decision reads so far as relevant:

"As from 1 January 1991 any benefit paid to Miss Tracy Daly was not paid as a direct consequence of the accident that she sustained on 4 March 1989. Accordingly, the appeal succeeds against the certificate of total benefit on the ground that the benefit paid otherwise than in consequence of the accident in question has been brought into account. Liability for repayment of amounts equal to the benefit (albeit not exceeding £5,500) lies with the compensator up to 1 January 1991.. adjustment is to be made accordingly.."

The findings of fact read so far as relevant:

" ... As a direct result of the affects of her injuries suffered in the accident Miss Daly was paid income support ... the case was subsequently heard before the medical appeal tribunal and matters that were not within the jurisdiction of that tribunal were referred to the SSAT. ... From 25 July 1991 Miss Daly declared herself fit for work but did not want to do her former occupation of hairdressing as she did not wish to stand all day. At that point she was seeking part-time work only because of the affects of the accident. There are two consultants' [EMOs'] reports dated 15 January 1991 and
1 May 1991 where both confirmed that Miss Daly was incapable of work at the occupation of hairdresser but is capable of work within certain limits. The GP has continued to issue Med 3 certificates up to July 1991. .. Solicitors for [compensator] maintain that as from 1 January 1991 Miss Daly was fit for work ... there is a medical report before the tribunal from Mr. Harral Thompson dated 20 May 1991 in which it is stated in his opinion that Miss Daly would reasonably be expected to return to work 18 months after the accident. The AO maintains that Miss Daly placed limits on the work she was capable of doing from 25 July 1991 because of the physical restrictions following the accident. Solicitors for [the compensator] maintain that as from 1 January 1991 any benefit that Miss Daly received could not be said to be paid because of her physical state following the accident."

The reasons for decision read so far as relevant:

"... we accept the oral evidence of Mr. O'Donnell which together with the report from Mr. Harral Thompson (29 May 1991) and the consultants' [EMOs'] reports and the opinions as to Miss Daly's capabilities for work dated 15 January 1991 and 1 May 1991 lead us to the conclusion that as from 1 January 1991 Miss Daly's capabilities for work no longer reflected her injuries she suffered as a result of the accident in March 1989. We recognise the fact that Miss Daly's GP continued to issue Med 3 certificates up to July 1991 but we feel the consultants' [EMOs'] reports together with that of Mr. Thompson outweigh the opinion of the GP. The diagnosis is not in dispute. What is at issue is whether Miss Daly was capable of work from
1 January 1991 despite having had the accident. We hold that she was receiving benefit from that date simply because she was unemployed because she could not find employment. She was not receiving benefit as a result of her injuries . . We are satisfied that [the compensator] is entitled to make such an appeal to the SSAT under the Social Security Administration Act 1992, section 98....."

8. Section 82(1) of the Social Security Administration Act 1992 ("the Act") provides so far as relevant:

"82. - (1) A person ("the compensator") making a compensation payment, whether on behalf of himself or another, in consequence of an accident, injury or disease suffered by one person ("the victim") shall not do so until the Secretary of State has furnished him with a certificate of total benefit and shall then-

(a) deduct from the payment an amount, determined in accordance with the certificate of total benefit, equal to the gross amount of any relevant benefits paid or likely to be paid to or for the victim during the relevant period in respect of that accident, injury or disease;

(b) - (c) ..."

Section 81(1) defines "relevant period" to mean so far as relevant:

"(b) … the period of five years immediately following the day on which the accident or injury in question occurred; but where before the end of that period the compensator makes a compensation payment in final discharge of any claim made by or in respect of the victim and arising out of the accident, injury or disease, the relevant period shall end on the day on which that payment is made."

Section 98 of the Act provides so far as relevant:

"98. - (1) An appeal shall lie in accordance with this section against any certificate of total benefit at the instance of the compensator, the victim or the intended recipient, on the ground-

(a) that any amount, rate or period specified in the certificate is incorrect, or

(b) that benefit paid or payable otherwise than in consequence of the accident, injury or disease in question has been brought into account.

(2) - (4) …

(5) If any of the medical questions arises for determination on an appeal under this section, the Secretary of State shall refer that question to a medical appeal tribunal, whose determination shall be binding, for the purposes of the appeal, on any social security appeal tribunal to whom a question is referred under subsection (7) below.

(6) . .

(7) If any question concerning any amount, rate or period specified in the certificate of total benefit arises for determination on an appeal under this section, the Secretary of State shall refer that question to a social security appeal tribunal, but where any medical questions arise on the appeal have been referred to a medical appeal tribunal -

(a) he shall not refer any question to the social security appeal tribunal until he has received the determination of a medical appeal tribunal on the questions referred to them; and

(b) he shall notify the social security appeal tribunal of the determination of the medical appeal tribunal.

(8) On a reference under subsection (7) above a social security appeal tribunal may either -

(a) confirm the amounts, rates and periods specified in the certificate of total benefit; or

(b) specify any increases, reductions or other variations which are to be made on the issue of the fresh certificate under subsection (9) below.

(9) - (11) ...

(12) In this subsection "the medical questions" means -

(a) any question whether, as the result of a particular occurrence, the victim suffered any injury, sickness or disease;

(b) any question as to the period for which the victim suffered any injury, sickness or disease."

9. The Compensation Recovery Scheme was introduced by section 22 and Schedule 4 of the Social Security Act 1989, now contained (in an amended form) in Part IV of the Act. The "relevant benefits" covered by the recovery scheme are listed in regulation 2 of the Social Security (Recoupment) Regulations 1990. Income support is listed in sub-paragraph (d).
10. Mr. Blake readily conceded that the interpretation of section 98 of the Act was fraught with problems. It was apparent that the intention was to reserve all medical questions for determination by a MAT. The difficulty arose because of the interpretation of "the medical questions" as defined by subsection (12) and the possible overlapping in the provisions of subsections (5) and (7). The initial issue was whether a medical question arose. If it did, the Secretary of State had a duty to refer the matter to a MAT under subsection 5. If it did not, the matter fell to be determined by a social security appeal tribunal. In the present case the issue was the period specified in the certificate of total benefit, such question to be determined under the provisions of subsections (5) or (7). Mr. Blake explained that in order to determine which subsection applied, the Secretary of State referred the matter to a full-time social security tribunal chairman sitting alone for advice as to whether or not a medical question arose. If he was advised that there was, he referred the matter to a MAT, as required under subsection 5. In the present case the usual practice had been adopted and on the advice of a full-time chairman that there was a medical question, the Secretary of State had referred that question to a MAT under subsection (5). It was not in dispute that the claimant had suffered injury as a result of her accident. The question for determination by the MAT under subsection (12)(b) was "for what period, did the victim suffer any injury, sickness or disease?". In answer to that question the MAT decided "from the date of the accident and continuing". The MAT's reasons for decision clearly indicated that they appreciated that they were concerned with causation and not with the issue of incapacity for work.
11. Mr. Blake submitted that the social security appeal tribunal had erred in law because they had determined the issue by reference to the victim's incapacity for work, whereas section 98 was solely concerned with the issue of causation. That question had been determined by the MAT and the tribunal were bound by that decision under subsection (5). Mr. Blake agreed that the words "and continuing" resulted in the maximum amount of the relevant benefits being recoverable, irrespective of whether or not the victim was capable of any form of work. He submitted that in those circumstances it would have been helpful if the MAT had decided a fixed period or recommended that the matter be reviewed by another MAT at a later date. Mr. Blake suggested that as the tribunal decision was almost a year after that of the MAT, the tribunal should have referred the medical question to another MAT for an up to date assessment, although he was unable to refer me to any powers enabling a tribunal to adopt this course.
12. On 15 December 1994 the Court of Appeal gave judgment in Hassall and Pether v. Secretary of State for Social Security. The facts in both cases were the same. Each man was unemployed at the time of the accident. One was in receipt of unemployment benefit and income support the other was in receipt of income support only. They were both available for and were actively seeking employment. In each case they continued to receive approximately the same amount in benefit after the accident as they had before. The Court of Appeal held that the post-accident benefits received were on a different basis, namely that they did not have to be available for employment or actively seeking it. The benefits received were in consequence of the accident. Lord Justice Henry held:

"The post-accident benefits that were paid were clearly paid on the strength of the medical certificates dealing with the injuries caused by the accident and the appellant's recovery from those injuries. Because of those medical certificates, only the post-accident form of benefits could be claimed ... It seems to me to be clear beyond argument that the post-accident benefits recouped were not "benefits paid otherwise than in consequence of the accident": they were clearly paid as a direct consequence of the accident. No other construction is possible."

13. Mr. Blake submitted that Pether and Hassall clearly related to a case where benefit was paid before the accident but changed its character after the accident so as to relieve the two victims of any obligation to be available for, and actively seek, work. In the present case the claimant was undoubtedly fit for light work from 25 July 1991 or, in the view of the MAT, from 1 January 1991. The question was not one of incapacity but of causation. On what basis was benefit paid from 1 January 1991? From that date until 24 July 1991 it was paid in consequence of the accident, because the victim declared unfitness for work as the reason for her claim to benefit and submitted medical statements in support. To that extent Pether and Hassall supported his submission. However from 25 July 1991 the position was more complicated, because the victim had declared herself to be fit and available for work and income support was paid on the basis that she was unemployed. However, the MAT had found that the victim was continuing to suffer from the effects of the accident as late as 1 March 1993. As a result Mr. Blake submitted that benefit from 25 July 1991 continued to be paid as a consequence of the accident. Under section 81(1) of the Act the relevant period ended on 12 June 1992, the date of the settlement. As a result the correct inclusive period to be covered by the certificate of total benefit was from 4 March 1989 to 12 June 1992. The benefits paid during this period were recoverable.
14. Mr. Goodbody accepted that the SSAT was bound by the decision of the MAT under section 98(5) of the Act. However he argued that the tribunals decision was not in conflict with that of the MAT. In his view the issue before the tribunal was whether benefits had been paid "otherwise than in consequence of the accident, injury or disease in question" for the purposes of section 98(1)(b). That was not a medical question. It fell within the sole jurisdiction of the tribunal and they were entitled to reach the decision they did based on the evidence before them. The MAT decided a different question. That was that the victim suffered as a result of her accident and was suffering and continued to suffer from "accident syndromes" at the date of their decision. Section 98(8) gave the tribunal wide powers. The tribunal were entitled to take capacity on board in determining the issues before them.
15. On 8 July 1992 a certificate of total benefit was issued covering the period from 4 March 1989 to 28 August 1992. The victim was in receipt of income support throughout that period. On 25 August, after the compensator's solicitor had made a partial payment, a further certificate was issued confirming that full repayment was required. The compensator then appealed against the certificate of total benefit. In a letter dated 1 October 1992 the solicitor asserted that a question arose as to the period for which the claimant suffered injury, sickness or disease and that since "the appeal concerns a medical aspect, we believe it should be dealt with by a medical appeal tribunal". It is clear however that the compensator's dispute was in fact with the period specified In the certificate on the basis that benefit paid otherwise that in consequence of the accident had been brought into account. The appeal fell to be determined under the provisions of section 98(1)(b) of the Act. In my view that was a question of fact within the sole jurisdiction of a SSAT. The issue, and the only issue that arose was why the Department had in fact been continuing to pay benefit from 25 July 1991 after the victim ceased to be incapacitated from the effects of the accident and was once again fit for work. That was to be decided on the evidence before the tribunal. Benefit was paid from 25 July 1991 not because the victim was suffering from incapacity, but because she was unable to get work even though available. Manifestly the benefit paid from then on could not have been paid, and, was not in fact paid, in consequence of the accident. The issue for determination did not depend on any "medical question" as defined in section 98(12) of the Act.
16. For the reasons stated above there was no medical question for determination and although there was a decision by a MAT, it was irrelevant to the issue before the tribunal as subsection (5) did not to apply. It follows that the tribunal were not bound by the decision of the MAT of 1 March 1993. I reject the submission of Mr. Blake because it was based on the assumption that a medical question arose for determination by a MAT under the provisions of subsection (5) and that the determination was relevant to the issues before the SSAT. I also reject the submission of Mr. Goodbody because although he rightly analysed that the issue before the tribunal fell to be determined under section 98(1)(b) of the Act he failed to refer to the relevant facts in determining this issue.
17. I now turn to the question as to whether the tribunal erred in law in concluding that benefit paid otherwise than in consequence of the accident had been brought into account after 1 January 1991. There was medical evidence supported by the comments of the MAT, that the victim was capable of light work from 1 January 1991. During the period from 4 March 1989 to 24 July 1991 the victim submitted medical statements from her own doctor advising her to refrain from work by reason of the injuries suffered as a result of the accident. On that basis she was not required to be available for employment or actively seeking it. On 25 July 1991 the claimant declared herself to be fit and available for work. Benefit was paid to her from that date because she was unemployed.
18. In the judgment in Hassall and Pether the Court of Appeal approved the observations by Mr. Commissioner Skinner in determining whether benefits recouped were not "benefits paid otherwise than in consequence of the accident":

"But because of the accident the basis of the claimant's entitlement to income support changed … he [was] as a result of his doctor's statement in support of his claim no longer required to be available for employment …, nor was he required to be actively seeking employment... He was relieved of his obligation to be available for work and that was in consequence of his accident."

19. The records of the Department show that during the inclusive period from 4 March 1989 to 24 July 1991 the victim was paid benefit in consequence of her accident. Thereafter the basis of her income support changed and she continued to be paid income support because she was unemployed. The tribunal erred in law because their decision that "from 1 January 1991 any benefit paid to [the victim] was not paid as a direct consequence of the accident" was contrary to the weight of the evidence. The victim's GP had provided evidence on form Med 3 as to her incapacity for work which formed the basis for her receipt of income support for the period up to 25 July 1991. The tribunal dealt with that evidence as follows "We recognise the fact that [the victim's] GP continued to issue Med 3 certificates up to July 1991 but we feel the consultants' reports together with that of Mr. Thompson outweigh the opinion of the GP". That was to confuse the issue before them. It was not for the tribunal to decide the question of the victim's capacity or otherwise for work but whether benefit paid had been paid in consequence of the accident. In this case the sole cause of the victim's incapacity had been the injuries she sustained in the accident and that incapacity, as evidenced by her GP's certificates, had been accepted by the Department as the basis for payment of income support until 24 July 1991. The basis upon which benefit was paid changed from 25 July 1991, and thereafter benefit paid was "otherwise than in consequence of the accident".
20. For the reasons above the certificate of total benefit issued by the Secretary of State was manifestly incorrect. It should have been limited to the inclusive period from 4 March 1989 to 24 July 1991 with the additional limitation that the amount recoverable should not exceed the amount of compensation i.e. £5,500, under the provisions of section 106 of the Act.
21. For the reasons stated above the tribunal's decision was erroneous in law. However, pursuant to section 23(7)(a)(i) of the Act I give the decision set out in paragraph 1.
22. The Secretary of State's appeal is allowed in part.

Date: 13 July 1995 (signed) Mrs. R. F. M. Heggs

Commissioner