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Cite as: [1997] UKSSCSC CI_4707_1995

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Chief Adjudication Officer v. Dickinson Chief Adjudication Officer v. Patterson [1997] UKSSCSC CI_4707_1995 (11 June 1997)

R(I) 3/98

(Chief Adjudication Officer v. Dickinson)

(Chief Adjudication Officer v. Patterson)

Mr. D. G. Rice CI/4707/1995

CA (Stuart-Smith, Morritt and Schiemann LJJ)

Claim - claim for reduced earnings allowance made before assessment of disablement - whether claimant automatically having "good cause" for the delay

The claimant claimed reduced earnings allowance on 3 September 1992. He had claimed disablement benefit on 6 August 1992. In June 1993, disablement was assessed at 5% from 1 January 1960 for life. The adjudication officer decided that the claimant did not have good cause for the delay in claiming reduced earnings allowance and so was not entitled to reduced earnings allowance before 3 June 1992. The claimant's appeal to a tribunal was dismissed and he appealed to the Commissioner who allowed the appeal, holding that the fact that there had been no assessment of disablement automatically amounted to good cause for not claiming the allowance. The Commissioner awarded special hardship allowance and reduced earnings allowance from 1 August 1985. The Chief Adjudication Officer appealed to the Court of Appeal who heard the case with an appeal from a decision of the same Commissioner on file CI/731/1995.

Held, allowing the appeals, that:

the question of good cause was to be determined on the facts of each individual case and a claimant did not automatically have good cause for delaying a claim for reduced earnings allowance until an assessment of disablement had been made.

DECISION OF THE SOCIAL SECURITY COMMISSIONER

My decision is that the decision of the social security appeal tribunal given on 20 February 1995 is erroneous in point of law and accordingly I set it aside. As it is convenient that I give the decision the tribunal should have given, I further decide that the claimant is not disentitled to reduced earnings/severe hardship allowance for the period from 1 August 1985 to 2 June 1992 by reason of the lateness of his claim. He has established continuous good cause for his delay.

This is an appeal by the claimant, brought with the leave of the tribunal chairman, against the majority decision of the social security appeal tribunal of 20 February 1995.

On 21 March 1994 the adjudication officer decided that the claimant was not entitled to reduced earnings allowance for the period from 1 August 1985 to 2 June 1992, because his claim for that period, lodged on 3 September 1992, was not brought within the time limit set out in the regulations, and he had not proved that there was continuous good cause for his delay. In due course, the claimant appealed to the tribunal, who by a majority upheld the adjudication officer.

A claim for disablement benefit in respect of prescribed disease D4 (mucous membrane) was not received until 6 August 1992. In June 1993 the adjudicating medical authority assessed the disablement at 5% from 1 January 1960 for life. Because that assessment was less than 14% no disablement benefit was awarded, but as it was not less than 1% the claimant was not prevented from claiming reduced earnings allowance (which by established practice would include the earlier benefit severe hardship allowance). He did not in fact make a claim for that allowance (which was from 1 August 1985) until 3 September 1992. This was out of time for any period prior to 3 June 1992, and neither the adjudication officer nor the tribunal were prepared to accept that he had good cause for his lateness. I consider that approach is wholly misconceived.

The claimant simply could not establish title to reduced earnings allowance until he had received an assessment for at least 1% in respect of disablement benefit. There was no practical advantage in making a claim until there had been an assessment. Without such an assessment, the claim was quite hopeless, and so of no practicable purpose whatsoever. In those circumstances, I consider it wholly unreasonable to have required the claimant to have lodged a claim for reduced earnings allowance at any time before he was in a position to establish title thereto. The earliest date when he knew that the necessary assessment had been made was June 1993, and by then he had made his claim for reduced earnings allowance. In those circumstances, I am satisfied that the claimant had good cause for his lateness, and consider it was unreasonable of the tribunal to have reached any other conclusion.

Accordingly, I set aside the tribunal's decision as being erroneous in point of law. However, it is unnecessary for me to remit the matter to a new tribunal for rehearing. I can conveniently substitute my own decision.

Accordingly, my decision is as set out in paragraph 1.

Date: 3 June 1996 (signed) Mr. D.G. Rice

Commissioner

The Chief Adjudication Officer appealed to the Court of Appeal who heard the case with an appeal from a decision of the same Commissioner on file CI/731/1995. The decision of the Court of Appeal follows.

DECISION OF THE COURT OF APPEAL

Miss N. Lieven (instructed by the solicitor of the Department of Social Security) appeared on behalf of the Appellants.

Mr. I. Wise (instructed by Messrs. Fanshaw Porter & Hazlehurst, Merseyside) appeared on behalf of the Respondent, Mr. Patterson.

Mr. M. Shrimpton (instructed by Messrs. Bebington Employment Centre, Wirral) appeared on behalf of the Respondent, Mr. Dickinson.

LORD JUSTICE STUART-SMITH: These appeals are brought by the Chief Adjudication Officer from two decisions of the social security Commissioner, Mr. Commissioner Rice, in the case of Patterson his decision of 22 May 1996, and in the case of Mr. Dickinson his decision of 3 June 1996. Both cases raise the same point on the construction of regulation 19 of the Social Security (Claims and Payments) Regulations 1987. Miss Lieven defines that question as whether the Commissioner was correct to find that the applicant automatically had good cause for not claiming reduced earnings allowance before the date that he was assessed as being disabled by the adjudicating medical authority.

The relevant statutory framework is this. By section 94 of the Social Security Contributions and Benefit Act 1992, subsection (1) provides:

"Industrial injuries benefits shall be payable where an employed earner suffers personal injury caused after 4th July 1948 by accident arising out of and in the course of his employment, being employed earner's employment.

(2) Industrial injuries benefit consists of the following benefits-

(a) disablement benefit payable in accordance with sections 103 to 105 below ...

(b) reduced earnings allowance payable in accordance with Part IV [of Schedule 7]."

By section 106(d) of that Act, Schedule 7 has effect in relation to reduced earnings allowance. Part IV of that Schedule is concerned with reduced earnings allowance and by paragraph 11(1) it is provided as follows:

"Subject to the provisions of this paragraph, an employed earner shall be entitled to reduced earnings allowance if-

(a) he is entitled to a disablement pension or would be so entitled if that pension were payable where disablement is assessed at not less than 1 per cent; and

(b) as a result of the relevant loss of faculty, he is either-

(i) incapable, and likely to remain permanently incapable, of following his regular occupation; and

(ii) incapable of following employment of an equivalent standard which is suitable in his case."

There is then an alternative to that provision.

It will be seen, therefore, that there are three conditions which have to be satisfied for the payment of the reduced earnings allowance: that contained in paragraph (a) and those contained in paragraph (b)(i) and (ii). It should perhaps be noted that the reduced earnings allowance ceases to be payable in respect of an accident happening after 1 October 1990.

The reference in paragraph (a) reflects the fact that disablement pension is not normally payable unless the assessment of disablement is not less than 14 per cent. The remaining provisions of Part IV of that Schedule are concerned with the calculation of the quantum of the allowance and basically depend upon the difference between the earnings without the disability and the reduced earnings resulting from disability.

In section 1 of the Social Security Administration Act 1992 subsection (1) provides:

"(1) Except in such cases as may be prescribed, and subject to the following provisions of this section and to section 3 below, no person shall be entitled to any benefit unless, in addition to any other conditions relating to that benefit being satisfied-

(a) he makes a claim for it in the manner, and within the time, prescribed in relation to that benefit by regulations under this Part of this Act; or

(b) he is treated by virtue of such regulations as making a claim for it.

(2) Where under subsection (1) above a person is required to make a claim or to be treated as making a claim for a benefit in order to be entitled to it-

(b) if the benefit is any other benefit except disablement benefit or reduced earnings allowance, the person shall not be entitled to it in respect of any period more than 12 months before that date."

The effect of that subsection is that the absolute cut-off time for claiming or recovery is twelve months before the date of the claim except in the case of disablement benefit and reduced earnings allowance where there is no limit of twelve months.

Section 5 of that Act contains the power to make regulations. Subsection (1) provides:

"(1) Regulations may provide-

(a) for requiring a claim for a benefit to which this section applies to be made by such person, in such manner and within such time as may be prescribed;

(b) for treating such a claim made in such circumstances as may be prescribed as having been made at such date earlier or later than that at which it is made as may be prescribed."

Pursuant to that power regulations were made, namely the Social Security (Claims and Payments) Regulations 1987. (They were of course made under the previous Act but are continued under the 1992 Act.) Regulation 19 provides as follows:

"(1) Subject to the provisions of Schedule 5 the prescribed time for claiming any benefit specified in column (1) of Schedule 4 shall be the appropriate time specified opposite that benefit in column (2) of that Schedule."

Sub-paragraph (2) provides:

"(2) Where the claimant proves that there was good cause, throughout the period from the expiry of the prescribed time for making the claim, for the failure to claim a benefit specified in column (1) of Schedule 4 before the date on which the claim was made the prescribed time shall, subject to section 165A of the Social Security Act 1975 (12 months limit on entitlement before the date of claim) and paragraphs 4 and (5), be extended to the date on which the claim is made."

Section 165A has now been replaced by section 1 of the Social Security Administration Act 1992, to which I have already referred.

The relevant provisions in this case are contained in Schedule 4. I refer briefly to the time for claiming benefit in relation to disablement benefit, which is under paragraph 3. The first column says "Disability benefit (not being an increase of benefit)". Then under "Prescribed time for claiming benefit" it provides:

"As regards any day on which, apart from satisfying the condition of making a claim, the claimant is entitled to benefit, that day and the period of three months immediately following it."

Then paragraph 5, which relates to reduced earnings allowance, the prescribed time for claiming benefit is said to be:

"As regards any day on which apart from satisfying the conditions that there is an assessment of disablement of not less than one per cent and the making of a claim, the claimant is entitled to the allowance, that day and the period of 3 months immediately following it."

It is convenient, for the purpose of construing that paragraph, to place brackets after the word "which" in the first line and after the words "the making of a claim" in the third from end line.

Miss Lieven submits that, on the express wording of this paragraph, the day on which the claim has to be made is that on which the second two conditions set out in Schedule 7, paragraph 11(1) are satisfied, but not the first condition, which can only be satisfied after an assessment has been made. This follows the ordinary scheme of the Act, namely that a claimant who believes he is entitled to a benefit makes a claim; he will then be assessed, in the case of a disablement question, by the adjudicating medical officer or on appeal by a medical appeal tribunal (see section 45(2) of the Social Security Administration Act 1992 or as otherwise provided by that section).

The effect of Schedule 4, paragraph 5, therefore, submits Miss Lieven, is that, as soon as a person believes that he has suffered industrial injury, which includes a prescribed disease, and may be entitled to disablement pension, or would be if such a pension were payable where disablement is assessed at no less than one per cent, as a result of the relevant loss of faculty he is incapable, and likely to remain permanently incapable, of following his regular employment and is incapable of following employment of an equivalent standard which is suitable in his case, he should make a claim and he has a further three months from that date. So effectively the claim can be back-dated up to three months from the date of the claim. If he fails to make the claim within three months of the on-set of the conditions and the satisfaction of conditions (2) and (3), then nevertheless the claim can be back-dated provided the claimant proves that there was good cause for not making the claim continuously throughout the relevant period (see regulation 19(2)). The claimant is in any event entitled to be paid benefit for the three months prior to the date of the actual claim.

Turning to the facts of the two cases, so far as the case of Mr. Patterson is concerned, he suffered from vibration white finger, which is a prescribed disease, from at least 1 April 1985. He made a claim for disablement benefit on 11 February 1992. On 15 October 1992 the DSS sent Mr. Patterson a claim form for reduced earnings allowance. On 2 June 1993 Mr. Patterson was examined by the adjudicating medical authority in respect of his claim for disablement benefit and on 25 June he was notified that he had been assessed at 8 per cent disability. On 6 July 1993 he claimed reduced earnings allowance. On 1 October 1993 the medical appeal tribunal allowed his appeal from the assessment of 8 per cent and increased it to 20 per cent disability as from 1 April 1995 for life.

On 8 April 1994 the adjudication officer found that Mr. Patterson was not entitled to back-date his claim for reduced earnings allowance beyond three months prior to the date of the claim. He appealed to the social security appeal tribunal, who dismissed his appeal on 9 November 1994. The reason given by the tribunal were as follows:

"Mr. Patterson's claim can be back-dated beyond the routine three month period only if he can establish continuous good cause for late claim. We would have found good cause for the period up to October 1992. But when the Department of Social Security sent Mr. Patterson the claim form they effectively put right the mix-up over the completion of the claim form. There was in our view no good reason for Mr. Patterson's failure to respond to the claim form or subsequent reminders. We do not accept that the absence of a firm diagnosis or assessment for the prescribed disease amounted to good cause. Such a mistaken belief was not in our judgment reasonably held. Continuous good cause not proved".

Then Mr. Patterson appealed to the Commissioner and, as I have indicated, Mr. Commissioner Rice allowed his appeal.

The facts, so far as Mr. Dickinson are concerned, are these. In 1985 he started seeing his general practitioner about a problem in connection with his nose and breathing. On 29 August 1992 he claimed reduced earnings allowance back-dated to 1 August 1995. On 9 June 1993 the adjudicating medical authority assessed Mr. Dickinson at five per cent disabled for life as from 1 January 1990. On 21 March 1994 the adjudication officer found that Mr. Dickinson was not entitled to reduced earnings allowance from 1 August 1985 to 2 June 1992. On 20 May 1995 the social security appeal tribunal dismissed Mr. Dickinson's appeal. The reasons that they gave are to be found at page 56 of the bundle in that case. It was a majority decision and the reasons were these:

"The issue is whether the tribunal back-dates reduced earnings allowance from 1 August 1986 to 8 June 1992 [I think those dates should be the other way round]. The appellant lays the blame for the failure to diagnose this condition on his general practitioner. We are satisfied he was aware of the causation of the disease which is explained in statements he made to the tribunal, in letters, and before the adjudicating medical authority/medical appeal tribunal. No evidence other than failure to diagnose the condition is given by the appellant. It is not a doctor's responsibility to advise a patient on welfare benefits ... Ignorance of the right to claim is not good cause. In all the circumstances it was unreasonable of the appellant not to have made enquiries of the DSS concerning his entitlement."

Then, as I have indicated, there was a dissenting view, which it is not necessary to read.

The Commissioner's decision in the case of Patterson is at pages 1 and 2 of the bundle. It is only necessary to read paragraphs 5 and 6 as in the previous paragraphs he sets out the facts.

"5. The claimant was not examined by the adjudicating medical authority to see whether he had vibration white finger until 2 June 1993, and when he heard the result he claimed reduced earnings allowance expeditiously. Accordingly, the claimant has, in my judgment, established continuous good cause for the delay.

I am aware that the adjudicator officer now concerned submits that the approach I have in fact adopted is erroneous. He cites paragraph 4 of my decision CI/15/1993 and paragraph 4 of my decision CI/76/1993, where I pointed out that until a disablement assessment had been made the claimant simply had no title to reduce earnings allowance 'and accordingly there was no reason for [him] to take any action'. The adjudication officer now concerned contends that this approach nullifies paragraph 5 of Schedule 4 to the Social Security (Claims and Payments) Regulations 1987. However there is nothing in this point. Paragraph 5 merely sets out the correct date for claiming, but in no way impinges on the right of the adjudicating authorities to allow a late claim where good cause has been established. In all cases of lateness the strict requirements of the regulations could be said to be nullified where good cause operates to permit a late claim. Further, as regards paragraph 5, it is difficult to see the sense in requiring a claimant to lay claim to a benefit for which at the time he is not entitled. Accordingly, I wholly reject the submission of the adjudication officer now concerned."

It is clear that the Commissioner considers that there is automatically good cause not to make a claim until the claimant has been assessed at no less than one per cent. Although Mr. Wise has made a gallant attempt to support the Commissioner reasoning, his submission, in my judgment, does violence to the wording of paragraph 5 of Schedule 4 of the regulations. Although that paragraph certainly lacked elegance of drafting, on this point is clear enough. Miss Leiven is plainly right that the time for making the claim is without regard to the assessment of disability. Indeed it is impossible to see what other meaning can be given to the words which I have included in brackets, and Mr. Wise was unable to suggest one.

Mr. Shrimpton on behalf of Mr. Dickinson accepts now, though not in his skeleton argument, that Miss Lieven is right in her construction of the paragraph. But he sought to argue that in Mr. Dickinson's case the Commissioner did not decide the matter on the basis that Mr. Dickinson had good cause not to make a claim until he had been assessed. He submitted that the Commissioner had simply decided that on the facts of that case there was good cause and that his decision should be upheld on this basis while the court simply clarified the position in law.

The gist of the Commissioner's decision in that case is to be found in paragraph 5 of his decision at page 2 of the bundle where he said this:

"The claimant simply could not establish title to reduce earnings allowance until he had received an assessment for at least 1% in respect of disability benefit. There was no practical advantage in making a claim until there had been an assessment. Without such an assessment, the claim was quite hopeless, and so of no practical purpose whatsoever. In those circumstances, I consider it wholly unreasonable to have required the claimant to have lodged a claim for reduced earnings allowance at any time before he was in a position to establish title thereto. The earliest date when he knew that the necessary assessment had been made was June 1993, and by then he had made his claim for reduced earnings allowance. In those circumstances, I am satisfied that the claimant had good cause for his lateness, and consider it was unreasonable of the tribunal to have reached any other conclusion."

Although there was no reference in that passage to Schedule 4, paragraph 5, that decision is in substantially the same terms as in the Patterson case. It is clear in my judgment that the Commissioner considered that the social security appeal tribunal were wrong in law because they had not adopted that approach. Indeed, he could not exercise his jurisdiction save on a point of law (see section 23(1) of the Social Security Administration Act 1992) and there is no discussion of the facts at all as to any other basis of good cause. The social security appeal tribunal reached their conclusion on the basis of a finding of fact and, however broadly Commissioners are entitled to interpret questions of law, they plainly cannot reverse findings of primary fact made by the social security appeal tribunal.

There is no attempt by the Commissioner to explain how he is satisfied that there was good cause other than his reasoning that, until an assessment was made, the claimant was not in a position to make a claim. He was, in my judgment, plainly in error. I agree with Miss Lieven that the question of good cause is to be determined on the facts of each individual case and cannot automatically exist simply because the relevant assessment of disablement has not yet been made. Although in their skeleton arguments counsel for both respondents submitted that paragraph 5 of Schedule 4 of the regulations was ultra vires the powers conferred by section 5 of the Social Security Administration Act 1992, that submission was not persisted in. It was plainly untenable.

I would allow the appeal.

LORD JUSTICE MORRITT: I agree. In both his decisions the Commissioner evidently considered that the absence of the disablement assessment was of itself good cause for the purpose of regulation 19(2) of the Social Security (Claims and Payments) Regulations 1987 so as to warrant the extension of the period for which reduced earnings allowance might be awarded to each of these claimants. In my view such a conclusion is inconsistent with the wording of the material parts of the regulation and wrong in law.

Paragraph 1 of regulation 19 imposes time limits in relation to a number of different benefits. Sub-paragraph (2) permits those limits to be exceeded where "the claimant proves that there was good cause", in effect, for exceeding them. It would be inconsistent with the structure of that regulation if the lack of a feature or condition common to all claims for a benefit were of itself capable of amounting to good cause. If that were so, the good cause would not be a reason specific to that claimant for exceeding the limit. It would be a change in the limit itself for all claimants. The limit is prescribed by Schedule 4, paragraph 5 to the same regulations. In order to make sense of it, it is necessary mentally to place brackets round that part which starts with the words "apart from" and ends with the word "claim". So read it becomes apparent that the existence of a disablement assessment is irrelevant in considering whether the claimant is entitled to the allowance for the purpose of the time limit.

The exclusion is necessary for under paragraph 11, Schedule 7 of the Social Security (Contributions and Benefit) Act 1992, such an assessment is a necessary precondition to entitlement. Similarly under Schedule 4, paragraph 5, the making of a claim is to be disregarded notwithstanding that under section 1 of the Social Security Administration Act 1992, entitlement to benefit is dependent on a claim. Thus it is apparent that the words in paragraph 5 "the claimant is entitled" cannot be read literally and in isolation for it is necessary in ascertaining the time limit to disregard the fact that two conditions for such entitlement are to be disregarded. It would be inconsistent with the express exclusion of the need for a disablement assessment to conclude that the absence of such an assessment was good cause. The effect of the Commissioner's decision is to ignore that express exclusion.

For these and the other reasons given by my Lord I would allow these appeals.

LORD JUSTICE SCHIEMANN: I agree with each judgment which has been given.

Order: Appeals allowed. Patterson: Costs not to be enforced without leave; legal aid taxation; application for leave to appeal to the House of Lords refused. Dickinson: No order as to costs.