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[1997] UKSSCSC CS_184_1994 (20 May 1997)

R(S) 1/98

Mr. M. J. Goodman CS/184/1994

20.5.97

Claim - claimant relying on a decision of the Court of Appeal - whether tribunal bound by section 68 of the Social Security Administration Act 1992

On 2 December 1992, the Court of Appeal held in Cottingham and Geary v. Chief Adjudication Officer and Secretary of State for Social Security (reported as R(P) 1/93) that occupational pensions did not qualify as "earnings" for the purposes of calculating a claimant's entitlement to an increase of benefit in respect of a dependant. On 5 December 1992, legislation reversed that decision. On 16 March 1993, the claimant claimed an increase of invalidity pension in respect of his wife who was in receipt of an occupational pension which, if treated as earnings, would have had the effect that the increase was not payable. The adjudication officer decided that the claimant was entitled to the increase only from 2 December 1992 to 4 December 1992, on the basis that the occupational pension prevented payment under the new legislation from 5 December 1992 and that payment before the date of the Court of Appeal's decision was precluded by section 68 of the Social Security Administration Act 1992. Section 68 provided that, where a court had found a decision of an adjudication officer to have been erroneous in point of law and a claim in another case would, apart from section 68, have fallen to be determined in accordance with the decision of the court, entitlement in respect of a period before the date of the decision of the court should be determined as thought the court had not found the adjudication officer to have erred in law. The claimant appealed to a tribunal who considered that, as an appellate body, they were not bound by section 68 and awarded the increase from a date before 2 December 1992. The adjudication officer appealed.

Held, allowing the appeal, that:

the House of Lords' decision in Bate v. Chief Adjudication Officer (reported as R(IS) 12/96) applied to section 68 (claims) as it applied to section 69 (reviews) and therefore, when section 68 restricted the power of an adjudication officer to award benefit, it equally restricted the power of a tribunal to award benefit on appeal from that adjudication officer;

the Court of Appeal in Cottingham and Geary had indirectly found erroneous in law the adjudication officers' decisions refusing benefit in the cases before them and section 68 therefore operated in the present case to prevent the increase of invalidity pension being awarded before the date of the Court of Appeal's decision.

DECISION OF THE SOCIAL SECURITY COMMISSIONER

I allow the adjudication officer's appeal against the decision of the social security appeal tribunal dated 18 January 1994 as that decision is erroneous in law and I set it aside. My decision is that in relation to the claim received on 16 March 1993 from the claimant for an increase of invalidity pension for his wife:

(a) The claimant is not entitled to that increase for any period earlier than 2 December 1992 because his entitlement to the increase depends solely on the decision of the Court of Appeal in the case of Cottingham and Geary v. Chief Adjudication Officer and Secretary of State for Social Security, given on 2 December 1992 [and reported as R(P) 1/93], and consequently section 68 of the Social Security Administration Act 1992 precludes entitlement on the claim for his wife for any earlier date than 2 December 1992;

(b) The increase of the invalidity pension for the claimant's wife is payable to him for the inclusive period from 2 December 1992 to 4 December 1992, under the said decision of the Court of Appeal;

(c) The increase of the invalidity benefit for his wife is not payable to the claimant from and including 5 December 1992 because her "earnings" were more than £32.55 per week (the then amount of the dependency increase of invalidity pension), consisting of occupational pension of £92.37 per week. For this purpose as from 5 December 1992 the occupational pension is regarded as earnings by virtue of regulation 8 of the Social Security Benefit (Dependency) Regulations 1977, SI 1977 No. 343, as amended by regulation 4 of the Social Security Benefit (Dependency) Amendment Regulations 1992, SI 1992 No. 3041.

This is an appeal by the adjudication officer to the Commissioner against the unanimous decision of a social security appeal tribunal dated 18 January 1994 which allowed in part the appeal of the claimant (a married man in receipt of invalidity pension from 11 December 1989) against a decision of the adjudication officer issued on 1 June 1993 in terms similar to those in paragraph 1 of my decision above.

On my direction the appeal was the subject of an oral hearing before me on 1 May 1997, together with another similar case on file CS/1111/1995. The adjudication officer was represented by Mr. Cooper of the Office of the Solicitor to the Departments of Health and Social Security. The claimant was not present but was represented by Mr. Madge of the Citizens Advice Bureaux. I am indebted to Mr. Cooper and Mr. Madge for their assistance to me at the hearing.

The tribunal allowed the claimant's appeal in part because it considered that section 68 of the Social Security Administration Act 1992 ("restrictions on entitlement to benefit in certain cases of error") did not affect the social security appeal tribunal exercising its appellate jurisdiction. Consequently, they held that, although the only entitlement to the claimant to an increase of invalidity benefit for his wife was the Court of Appeal's decision in the Cottingham case referred to in paragraph 1(b) above, they could nevertheless back-date the increase of invalidity benefit for the claimant's wife to a date earlier than that of the Court of Appeal's decision on 2 December 1992.

It is against that ruling that the adjudication officer appeals on the following grounds (15 February 1994):

"The tribunal have misconstrued the application of section 68 of the Social Security Administration Act 1992 in deciding that it [the tribunal] was the "adjudicating authority" for the purposes of section 68(4) of that Act. It is submitted that the definition in section 68(4) clearly refers to the use of the phrase "adjudicating authority" in section 68(1). This relates to the decision that was "found" [section 68(1)(a)] to be erroneous by the Court. What was "found" to be erroneous in law in the Geary and Cottingham judgment was, indirectly, the [adjudication officer's] original decisions refusing benefit in those cases. In these circumstances the provisions of section 68 would apply to claimants making claims for benefit after 2 December 1992 [the date of the Court of Appeal's decision in the Cottingham case], as in this case ..."

I accept that ground of appeal, for the reasons given below.

Section 68 of the Social Security Administration Act 1992 and the following section, section 69 (dealing with reviews rather than claims, dealt with by section 68) were introduced by Schedule 6 to the Social Security Act 1990 and other provisions of that Act. Sections 68 and 69 come under the same head in the 1992 Act viz "Restrictions on entitlement to benefit following erroneous decision". So far as is relevant, section 68 provides as follows:

" 68. (1) This section applies where-

(a) on the determination, whenever made, of a Commissioner or the Court (the 'relevant determination'), a decision made by an adjudicating authority is or was found to have been erroneous in point of law; and

(b) after ...

(i) ...

(ii) the date of the relevant determination,

a claim which falls, or which would apart from this section fall, to be decided in accordance with the relevant determination is made ... by any person for any benefit.

(2) Where this section applies, any question which arises on, or on the review of a decision which is referable to, the claim mentioned in subsection (1)(b) above and which relates to the entitlement of the claimant or any other party to any benefit-

(a) in respect of a period before the relevant date; or

(b) ...

shall be determined as if the decision referred to in subsection (1)(a) above had been found by the Commissioner or court in question not to have been erroneous in point of law.

(3) ...

(4) In this section-

'adjudicating authority' means-

(a) an adjudication officer or, where the original decision was given on a reference under section 21(2) or 25(1) above, a social security appeal tribunal, ...;

(b)-(c) ...

'the court' means the ... Court of Appeal ...;

'the relevant date' means whichever is the latest of-

(a) the date of the relevant determination;

(b) ...

(c) the earliest date in respect of which the claimant would, apart from this section, be entitled on that claim to the benefit in question.

(5) For the purposes of this section-

(a) any reference in this section to entitlement to benefit includes a reference to entitlement-

(i) to any increase in the rate of a benefit; or

(ii) to a benefit, or increase of benefit, at a particular rate; and

(b) any reference to a decision which is 'referable to' a claim is a reference to-

(i) a decision on the claim

(ii) a decision on a review of the decision on the claim, or

(iii) a decision on a subsequent review of the decision on the review,

and so on.

(6) ..."

Section 69 of the 1992 Act headed "Determination of questions on review following erroneous decisions" is in similar terms but applicable to applications for review rather than original claims. Section 69(4) states that "adjudicating authority" is to have the same meaning as in section 68.

Since the adjudication officer's appeal to the Commissioner on 15 February 1994, there have been case law developments in this field. These result from the case of Bate v. Chief Adjudication Officer, decided by the Court of Appeal on 30 November 1994, but whose decision relevant to the point at issue in this case was reversed by the House of Lords [whose decision is reported as R(IS) 12/96] on 16 May 1996. The Bate case was concerned with the interpretation of section 69 of the Social Security Administration Act 1992 and not with section 68 which is in issue in this case. On 4 November 1996 I directed an oral hearing of this case, adding that I should require legal argument on the question whether the House of Lords' decision in the Bate case applies equally to section 68 of the Social Security Administration Act 1992 (claims) as it does to section 69 (reviews)." I gave that direction because at various stages the adjudication officer has variously submitted, first (at the Court of Appeal stage in the Bate case) that section 68 must be considered entirely separately from section 69 but, secondly that the decision of the House of Lords on section 69 in the Bate case applies equally to section 68. My decision is that the Lords' decision in the Bate case, on section 69 of the 1992 Act, applies equally to section 68, for the following reasons.

In the Bate case, in the House of Lords, arguments similar to those used by the social security appeal tribunal in this case (see paras. 4 and 10) were adduced to the House of Lords, based on the Court of Appeal's decision in that case. However, at page 6 of the transcript of the Lords' decision, Lord Slynn said:

"As I see it section 104(7) [i.e. of the 1975 Act as inserted by the Social Security Act 1990, now section 69(1) of the Social Security Administration Act 1992] applies where:

(1) in case B the Commissioner or the court determines that an adjudication authority has made a decision in that case which was erroneous in law.

(2) in case A, decided earlier than case B, a decision has been based on the same error of law so that but for [what is now section 69(2) to (4) of the 1992 Act] the earlier decision would fall to be revised on a review for error of law.

(3) the effect is that if a question arises on the review of case A as to a person's entitlement to benefit the determination of the Commissioner or the court is taken as being that the decision was not erroneous in point of law in respect of any period before the date of the determination. The result is that the claimant in case A cannot take advantage of the determination in case B retrospectively."

At page 8, Lord Slynn said:

"I do not accept that the object of the legislation was simply to allow review to begin at the appellate level, for which leave was required, and thereby to prevent frivolous or repeated applications, as the Court of Appeal thought. On the face of it this amendment was intended to exclude claims based on a change in the law following a subsequent decision by the statutory authorities or by the courts. Nor do I think that it is right to say, if a Commissioner decides that there has been an error of law in the case before him, that its effect on the earlier case is simply that there has been a deemed decision that the adjudication officer was right in law which can be appealed to a court. The intention, in my view, was that that deemed decision in the earlier case is to be treated as correct at all stages of the process and that claims for benefit arising prior to the subsequent determination should be excluded." (my emphasis)

In my judgement, those words apply equally to claims as to reviews, even if Lord Slynn did not use the word "claim" in a technical sense but only as a synonym for review, as Mr. Madge submitted to me.

In their reasons for decision, the social security appeal tribunal drew attention to the definition in section 68(4) of the 1992 Administration Act defining "adjudicating authority" as, so far as is relevant in this case "an adjudication officer or, where the original decision was given on a reference under section 21(2) or 25(1) above, a social security appeal tribunal, a disability appeal tribunal or a medical appeal tribunal;" (my emphasis). The emphasised words refer to the adjudication officer's power to "decide a claim of question himself or refer it to a social security appeal tribunal" (section 21(2)) or to refer an application for review to a social security appeal tribunal (section 25(1)). The tribunal interpreted that as meaning that if the social security appeal tribunal was not deciding an adjudication officer's reference but was deciding an appeal then it was not bound by the restriction on retrospection in section 68. However, in the Bate case, the House of Lords pointed out that there was not really a distinction in this respect between a body exercising an appellate or a review function. Moreover, what in my view is meant by section 68(4)(a) in its definition of "adjudicating authority" is simply to refer to the adjudicating authority which gives the first instance decision. That would normally be the adjudication officer and was so in this case. That is why the reference to the social security appeal tribunal is confined (by the 1992 Act, as part of "tidying up" on consolidation) to adjudication officers' references under section 21(2) and 25(1). On such a reference the tribunal is not exercising an appellate function but is the primary adjudicating authority. But it is not permissible to infer that, if the social security appeal tribunal is exercising its appellate jurisdiction, then it is not bound by section 68 and 69. That much was made clear by the House of Lords in the Bate case in relation to section 69 and a Commissioner's appellate jurisdiction. Indeed it appears that in that case the point was conceded so far as the social security appeal tribunal was concerned. Mr. Madge, however, put the matter in a different way. While, as I understood him, not supporting the tribunal's reasoning, he contended that the words "any question which arises on ... the claim" in subsection (2) of section 68 did not cover the function of an appellate body deciding an appeal. He contrasted the separate provision of section 36 of the 1992 Act empowering tribunals to decide questions which arose first only on an appeal. Moreover, subsection (5)(a) does not in terms refer to an appeal. I reject Mr. Madge's contention, ably made though it was. It is, in my view implicit in the Lords' ruling in the Bate case that, for the purpose of the statutory restriction on backdating, a decision on appeal is a determination of a "question which arises on the claim" within section 68(2).

For all the above reasons I allow the adjudication officer's appeal and I have substituted my decision, accordingly in paragraph 1 above.

Date: 20 May 1997 (signed) Mr. M. J. Goodman

Commissioner