UKSSCSC CF_3532_1997 (21 October 1998)
Mr. J. Mesher CF/3532/1997
Council Regulation (EEC) 1408/71 and the Anglo-German Convention - whether person ordinarily resident in Germany and employed by the NAAFI in Germany is subject to United Kingdom legislation
Recovery of overpayment - benefit awarded on a mistaken basis continuing in payment due to failure to disclose a change of circumstances - whether failure to disclose a "material" fact
The claimant lived in Germany and was awarded British child benefit on the Department of Social Security's understanding that he was entitled to it for as long as he worked for the NAAFI and paid United Kingdom Class 1 contributions. He ceased to be employed by the NAAFI and to pay United Kingdom Class 1 contributions in March 1994 but child benefit continued in payment until May 1995. The adjudication officer and, on appeal, a tribunal decided that benefit overpaid between March 1994 and April 1995 was recoverable from the claimant under s. 71 of the Social Security Administration Act 1992 on the ground that he had failed to disclose the material fact that he had ceased to be employed in employment subject to United Kingdom Class 1 contributions. The claimant appealed to the Commissioner, contending that he had informed the Department of Social Security that he was to be made redundant by the NAAFI.
Held, dismissing the appeal, that:
- there was no error of law in the tribunal not dealing with the claimant's point on disclosure as he had not put evidence to that effect before the tribunal (paragraph 5);
- because the claimant had become ordinarily resident in Germany before the birth of his children, he was subject to German legislation and should not have been awarded British child benefit (paragraphs 8 to 21);
- nevertheless, his ceasing to be employed by the NAAFI was a material fact because it was material to the decision that was operative and it was not turned into a non-material fact because the decision was wrong for another, more fundamental, reason (paragraph 29);
- applying Duggan v. CAO (reported as an appendix to R(SB) 13/89), it was not within the powers of adjudication officers, appeal tribunals or Commissioners to apportion responsibility for an overpayment (paragraph 31).
The Commissioner subsequently refused the claimant leave to appeal as did the Court of Appeal (upon the claimant's non-attendance at the hearing).
DECISION OF THE SOCIAL SECURITY COMMISSIONER
The Award of Child Benefit
(a) United Kingdom legislation
(b) European Community legislation
"An employed or self-employed person subject to the legislation of a Member State shall be entitled, in respect of the members of his family who are residing in another Member State, to the family benefits provided for by the legislation of the former State, as if they were residing in that State, subject to the provisions of Annex VI."
If the claimant were subject to German legislation, Article 73 could not apply, because his children would not be residing in a different Member State.
(c) European Community law and the Anglo-German Convention
"The provisions of Article 6 notwithstanding, the following shall continue to apply:
(c) the provisions of the social security conventions listed in Annex III."
Article 6 provides that, subject to Article 7 and some other provisions, Regulation 1408/71 replaces previous social security conventions binding two or more Member States. Annex III includes in its list (at what is now point 39 of Section A) Articles 3(1) and (6) and 7(2) to (6) of the Anglo-German Convention on Social Security of 20 April 1960. Thus, if those parts of the Convention make a different provision about the legislation to which British NAAFI employees are subject, that rule will apply for the purposes of Regulation 1408/71 instead of the general rule in Article 13 (2)(a).
"(2) Subject to the provisions of paragraphs (3) and (5) of this Article—
(b) where a person is employed in the territory of the Federal Republic in the Government service of the United Kingdom or of Northern Ireland or in the service of a public corporation of the United Kingdom, the legislation of the United Kingdom shall apply to him as if he were employed in its territory.
(5) If a person is employed in the territory of one Party by the forces of the other Party in a civilian capacity or by an organisation serving those forces and is not ordinarily resident in that territory, then the legislation of the latter Party shall apply to him as if he were employed in its territory.
(6) The competent authorities of the Contracting Parties shall agree a list of the organisations to which the provisions of paragraph (5) of this Article shall apply."
"abode in a particular place or country which he has adopted voluntarily and for settled purposes as part of the regular order of his life for the time being, whether of short or long duration."
On "settled purpose", Lord Scarman also said, at  2 AC 344C:
"The purpose may be one; or there may be several. It may be specific or general. All that the law requires is that there is a settled purpose. This is not to say that the [person] intends to stay where he is indefinitely, indeed his purpose, while settled, may be for a limited period. Education, business or profession, employment, health, family or merely love of the place spring to mind as common reasons for a choice of regular abode. And there may well be many others. All that is necessary is that the purpose of living where one does has a sufficient degree of continuity to be properly described as settled."
A further important point is that it is quite possible for a person to be ordinarily resident in more than one place or country at the same time (see at  2 AC 342F).
The Overpayment and Recoverability Issue
"may well have been a cause of the overpayment as well as the failure to disclose. The wrong assumption by the Adjudication Officer may in certain circumstances have been a cause of the overpayment, but it does not follow that it was the sole cause. As a matter of common-sense, which questions of causation always are, if one poses the question: did the failure of the claimant to disclose the fact that his wife was in receipt of unemployment benefit have as at least one of its consequences the overpayment of the supplementary benefit?, the only reasonable answer that one can give is 'yes'."
The overpayment was therefore recoverable from the claimant. Any question of apportioning responsibility among multiple causes, if a misrepresentation of or failure to disclose a material fact has as a consequence an overpayment of benefit, arises only at the stage where the Secretary of State is considering whether and how to enforce all or part of his right to recover the overpayment from the person concerned.
the investigation revealed that some records had been destroyed in the ordinary course of administration. However, even if the claimant is right in what he says as a matter of fact, that does not mean that the appeal tribunal's decision was wrong in law. As explained in paragraph 5 above, that point was not made by the claimant in his appeal letter to the appeal tribunal, and an appeal tribunal does not err in law in failing to deal with evidence or contentions which were not put to it.
Date: 21 October 1998 (signed) Mr. J. Mesher