UK Social Security and Child Support Commissioners' Decisions

M. v. Secretary of State for Social Security [2001] UKSSCSC CDLA_1041_1998 (05 July 2001)

R(DLA) 7/01
(M. v. Secretary of State for Social Security [2001] UK HL 35)

HL (Lord Bingham of Cornhill, Lord Nicholls of CDLA/1041/1998

Birkenhead, Lord Hobhouse of Woodborough,

Lord Millett, Lord Scott of Foscote)

5.7.01

Residence condition - transitional protection - whether applies on a renewal claim for period

The claimant who was a severely disabled child, born in Pakistan and brought to the United Kingdom by her parents, had been awarded disability living allowance from 27 September 1993 to 26 September 1996. Her claim for the benefit to be renewed from 27 September 1996 was refused because she did not satisfy regulation 4 of the Social Security (Persons from Abroad) Miscellaneous Amendments Regulations 1996 ("the 1996 regulations"). Regulation 4 which came into effect on 5 February 1996 created a new requirement for entitlement: that a claimant's right to reside or remain in Great Britain was not subject to any limitation or condition. The claimant did not satisfy this requirement because she had remained beyond the period of her leave to enter the United Kingdom. A tribunal allowed the claimant's appeal on the grounds that regulation 12(3) applied to her claim. Regulation 12(3) provided that "Where, before the coming into force of these Regulations, a person is receiving … disability living allowance … under the … Disability Living Allowance Regulations … those Regulations shall, until such time as his entitlement to that benefit is reviewed under section … 30 of the Social Security Administration Act 1992, have effect as if regulation … 4 … of these Regulations had not been made." The Commissioner allowed the adjudication officer's appeal following R. v. Chief Adjudication Officer ex parte B [1999] 1 WLR 1695 and the Court of Appeal subsequently dismissed the claimant's appeal. It was argued before the House of Lords, that the effect of the natural and ordinary meaning of regulation 12(3) was to enable not only an award of benefit made before 5 February 1996 to be transitionally protected but to enable an award on a further claim after that date to be made as there had been no review of her entitlement to benefit under section 30 of the Social Security Administration Act 1992.

Held, by the House of Lords, dismissing the claimant's appeal, that:

1. the evident purpose of regulation 12 was to save or preserve accrued rights to benefit to which the claimant was entitled to immediately before the amending regulations came into force. The fact that regulation 12 could not be read literally in this respect did not mean that the Court could depart from the ordinary meaning of the words of the regulation in other respects (see Bank of Credit and Commerce International SA v. Ali [2001] 2 WLR 735, 757 paragraphs 63-65 per Lord Hoffmann). The general words of an elliptically drafted statute were not necessarily to be interpreted literally regardless of the context and the object of the regulation (see In re International Tin Council [1989] CH 309, 329-330);
2. the extent to which regulation 4 was to be disapplied derived from the terms of the precondition and the evident purpose of the regulation. The disapplication was limited to the claimant's accrued right to the particular benefit which she was receiving immediately before the amending regulations came into force which, in the claimant's case, was the right to receive disability living allowance of a stated amount for a period of three years. Regulation 4 was only disapplied as regards that entitlement;
3. regulation 12(3) did not have the effect of extending the amount or duration of the claimant's award beyond the term for which it was awarded even without the words "… until such time as his entitlement to that benefit is reviewed under section … 30 of the Social Security Administration Act 1992". There was no anomaly in a situation where the protection of regulation 12(3) ceased on expiry of a fixed term award but continued indefinitely in the case of a life award because in both cases, the protection continued as long as it was needed to preserve an accrued entitlement but no longer. (Gibson LJ's remarks in ex parte B at page 1706 confirmed);
4. the words "entitlement to benefit" in "shall continue until … his entitlement to benefit is reviewed" referred to that benefit which the claimant was receiving immediately before the amending

regulation came into force. This was another example of elliptical drafting, which must be understood as a reference to the decision under which the claimant's entitlement to the benefit arose. The cessation provision was thus brought into line with the precondition; since both were concerned with the preservation of accrued rights under an existing award which predated the coming into force of the amending regulations but which is subject to review;

5. the preservation of accrued rights did not justify their enlargement by disapplying regulation 4 to new and repeat claims and a decision on a review could properly be equated with a decision on a repeat claim.


DECISION OF THE HOUSE OF LORDS

Mr. A. Nicol QC and Mr. S. Cox (instructed by Messrs. Luqmani Thomson and Partners) appeared on behalf of the Appellant.

Mr. R. Drabble QC (instructed by the Solicitor to the Department of Social Security) appeared on behalf of the Respondent.

Judgment (reserved)

LORD BINGHAM OF CORNHILL

My Lords,

1. I have had the advantage of reading in draft the opinion of my noble and learned friend Lord Millett, and gratefully adopt his summary of the relevant facts and submissions.

2. Disability benefit is paid out of public funds to those who are severely disabled. The applicant's condition was such that she qualified for and received this benefit. Regulation 4 of the Social Security (Persons from Abroad) Miscellaneous Amendments Regulations 1996 (S.I. 1996/30) introduced a new condition of eligibility for payment of the grant, relating not to an applicant's medical need for assistance but to an applicant's immigration status. The introduction of this new condition plainly presented the draftsman with a question to be resolved: how was the new immigration condition to be applied to recipients currently in receipt of the benefit who did not meet the new condition?

3. One answer would have been to provide that those in receipt of the benefit when the new condition came into effect should continue to be eligible to receive it, whether they met the new condition or not, so long as their medical need for assistance persisted. This solution would have had the humanitarian advantage that benefit would not be withdrawn from those who continued to need it on medical grounds and had received it in the past and might have come to depend on it. This is, in effect, the solution which the applicant says was adopted. Another answer would have been to provide that existing recipients should continue to be eligible until the period (whether fixed or indefinite) of their current grants of benefit expired or they ceased to need the grant on medical grounds, whichever might be sooner. This solution would have served the ends of greater economy and uniformity. It is, in effect, the solution which the Secretary of State says was adopted. Whatever the answer favoured by the draftsman it should not have been hard to express it with enough clarity to avoid argument.

4. The diversity of opinion among members of the social security appeal tribunal in this case and the Court of Appeal, in the earlier case of R v. Chief Adjudication Officer, Ex p B [1999] 1 WLR 1695, culminating in this appeal to the House, unhappily shows that such clarity was not achieved. I am not for my part persuaded that the Secretary of State's construction favoured by all my noble and learned friends is clearly correct; but equally I find no clear indication that the applicant's construction is to be preferred, and the Secretary of State's construction is somewhat more consistent with the language used. With some misgiving, therefore, and considerable sympathy for the applicant, I am prepared to agree that the decision in Ex p B should be affirmed and this appeal dismissed.

LORD NICHOLLS OF BIRKENHEAD

My Lords,

5. I have had the advantage of reading in draft the speech of my noble and learned friend Lord Millett. For the reasons he gives, and with which I agree, I too would dismiss this appeal.

LORD HOBHOUSE OF WOODBOROUGH

My Lords,

6. I have had the advantage of reading in draft the speech which my noble and learned friend Lord Millett is about to deliver. I agree that the appeal should be dismissed for the reasons which he has given.

LORD MILLETT

My Lords,

7. The appellant is a severely disabled child aged nine. She was born in Pakistan and was brought here by her parents in 1993 when she was one year old. She lives with her parents in Lancashire.

8. On 8 September 1993 she made a claim for disability living allowance. She satisfied the conditions of residence and presence in Great Britain currently prescribed by regulation 2 of the Social Security (Disability Living Allowance) Regulations 1991 (S.I. 1991/2890) ("the principal regulations"). On 16 December 1993 an adjudication officer of the Department of Social Security awarded her an allowance for a period of three years from 27 September 1993 to 26 September 1996.

9. On 5 February 1996 regulation 4 of the Social Security (Persons From Abroad) Miscellaneous Amendments Regulations 1996 (S.I. 1996/30) ("the amending regulations") imposed an additional condition of entitlement to the allowance. This required that a claimant's right to reside or remain in Great Britain be not subject to any limitation or condition. The appellant did not satisfy this condition because she had remained beyond the time limited by her leave to enter the United Kingdom. The relevant conditions are now contained in reworded but substantially identical form in section 115 of the Immigration and Asylum Act 1999 which came into force on 3 April 2000. The appellant and her parents were granted indefinite leave to remain in the United Kingdom on 19 July 2000. The appellant thus now satisfies the conditions of the allowance but has done so only since 19 July 2000. The present dispute concerns her entitlement to the allowance between 27 September 1996 and 18 July 2000.

10. On 7 June 1996 in anticipation of the expiry of the current award the appellant made a claim to an allowance for a further period. On 16 August 1996 an adjudication officer ruled that the appellant did not satisfy the additional condition imposed by regulation 4 of the amending regulations and was accordingly not entitled to a further award. On 31 October 1996 another adjudication officer reviewed the decision but affirmed it.

11. The appellant's appeal was allowed by a social security appeal tribunal (by a majority) on the ground that regulation 12(3) of the amending regulations applied to her claim. On 21 June 1999 a social security Commissioner, bound by a decision of the majority of the Court of Appeal (Peter Gibson and Schiemann LJJ, Simon Brown LJ dissenting) in R v. Chief Adjudication Officer, Ex p B [1999] 1 WLR 1695, allowed the appeal of the adjudication officer and restored his decision of 31 October 1996. The Court of Appeal formally dismissed the appellant's appeal from the decision of the social security Commissioner.

12. The present appeal is thus effectively an appeal from the decision of the Court of Appeal in Ex p B. It turns on the true construction of regulation 12(3) of the amending regulations. Omitting words which relate to other benefits this reads as follows:

"Where, before the coming into force of these Regulations, a person is receiving … disability living allowance … under … the ... Disability Living Allowance Regulations … those Regulations shall, until such time as his entitlement to that benefit is reviewed under section … 30 of the Social Security Administration Act 1992, have effect as if regulation … 4 … of these Regulations had not been made."

The question for decision is whether the principal regulations apply in their unamended form to a claim to disability living allowance made after the date on which the amending regulations came into force by a claimant who was in receipt of the allowance immediately before that date under an award for a fixed term which has since expired.

13. In order that the context in which this question arises may be understood, it is necessary to give a brief description of the structure of the benefit system. Disability living allowance is a non-contributory, non-means-tested benefit for the severely disabled. It comprises two components: a care component and a mobility allowance. Like most benefits, it is calculated at a weekly rate and is normally paid weekly. Section 1 of the Social Security Administration Act 1992 provides that (with exceptions which are not material) no person is entitled to any benefit (including disability living allowance) unless he is eligible for such benefit and makes a claim for it in the manner and at the time prescribed by regulations. Save in special circumstances, therefore, every entitlement to benefit is preceded by a claim.

14. A successful claim results in a decision of an adjudication officer under which the claimant is entitled to receive benefit for the duration of the award. In the case of disability living allowance the award must be either for life or for a fixed period: section 71(2) of the Social Security Contributions and Benefits Act 1992. In the present case it was for a fixed period of three years. Benefit awarded for a fixed period automatically ceases to be payable at the expiration of the period. A claimant who wishes to continue to receive benefit after the expiry of the period for which it was awarded must make a further claim and seek a fresh award on that claim. If he is to avoid any discontinuity in the receipt of benefit, he must make the claim before the expiry of the current award.

15. A claimant may also cease to be entitled to benefit if the decision under which it is payable is reviewed pursuant to a statutory provision to that effect. In the case of disability living allowance, section 30(2) of the Social Security Administration Act 1992 makes provision for a decision to be reviewed on specified grounds. These include the case where the award was made in ignorance of, or was based on a mistake as to, some material fact; or where there has been any relevant change of circumstances since the decision was made; or the decision was erroneous in point of law. At one time the Department took the view that the coming into force of the amending regulations was a change of circumstances capable of justifying a review, but when leave was given to challenge this by judicial review the Department conceded the point. As Simon Brown LJ explained in R v. Chief Adjudication Officer, Ex p B [1999] 1 WLR 1695, 1699, this was not because a change in the law could not be a relevant change of circumstances: it normally would be. It was because regulation 12(3) operated to disapply regulation 4 only until review; the coming into force of regulation 4 could not therefore itself constitute a ground for review.

16. It is hardly necessary to observe that only a current award is capable of being reviewed. There is neither need nor power to review an award under which the benefit has ceased to be payable by effluxion of time. If the claimant wishes to continue to receive benefit and makes a further claim, it will be the subject of a fresh determination by reference to the circumstances at the time of the new claim.

17. After these preliminaries, I turn to regulation 12(3) of the amending regulations. It is in three parts:

(i) a pre-condition ("Where, before the coming into force of these Regulations, a person is receiving … disability living allowance under … Disability Living Allowance Regulations");

(ii) an operative part ("those Regulations shall … have effect as if regulation … 4 … of these Regulations had not been made"); and

(iii) a cessation provision ("… until such time as his entitlement to that benefit is reviewed under section … 30 of the Social Security Administration Act 1992").

18. The whole of regulation 12 comes under the heading "Saving". It contains three paragraphs each of which deals with a different situation. Each takes as its starting point the claimant's position "before the coming into force of these Regulations", but thereafter the pre-conditions diverge in matters of detail. Paragraph (1) is concerned with the position of an asylum seeker who was entitled to benefit before the amending regulations came into force, paragraph (2) with the position of a claimant who had made a claim to or was receiving certain specified benefits, and paragraph (3) with a claimant who was receiving other specified benefits. All three paragraphs provide in their operative part that the principal regulations shall apply as if the amending regulations had not been made, but only paragraph (3) contains a cessation provision.

19. The Court of Appeal considered, rightly in my view, that paragraphs (1) and (2) were of limited assistance in deciphering the meaning of paragraph (3). The most that can be said is that regulation 12 is a saving provision which preserves existing entitlements but subject to different preconditions and for different periods in different factual situations. But for regulation 12(3), regulation 4 would disqualify claimants who were in receipt of disability living allowance when the amending regulations came into force of their entitlement to the allowance. Regulation 12(3) has the effect of disapplying regulation 4 in the case of every such claimant until (if ever) his case is reviewed.

20. It is not easy to discern the policy which dictated that regulation 12(3) should cease to have effect on the occasion of a review, whatever the purpose of the review and irrespective of its outcome. As Schiemann LJ observed, this can produce results which appear to be capricious. A review can be initiated by the claimant or by the Department. It can lead to a withdrawal of benefit, but it can also lead to an increase, a reduction or no change in the benefit payable. In the case of a review which resulted in the adjudication officer declining to make any change, the mere fact of the review would deprive someone in receipt of benefit of the protection of regulation 12(3) and result in the withdrawal of benefit even though there was no change in his circumstances. In the case of a person with an award for life, the effect could be very significant. Moreover, as the appellant observed, where the review would have resulted in the withdrawal of benefit under the principal regulations in their unamended form, it would cease to be payable irrespective of the application of regulation 4. Thus regulation 12(3) has effective operation only in a case where the review would otherwise have upheld the claimant's entitlement in whole or part.

21. The appellant contends that the effect of regulation 12(3) is that the principal regulations apply in their unamended form not only to the benefit payable under the award made before the amending regulations came into force but also, in the case of a person who was in receipt of benefit at that date, to a claim for a further award made after that date. She says that this is the effect of the regulation according to its natural and ordinary meaning. She submits that:

(i) she satisfies the precondition in that she was in receipt of disability living allowance immediately before the amending regulations came into force;

(ii) the operative part provides that the principal regulations have effect as regards her in their unamended form;

(iii) the cessation provision can be disregarded because there has been no review of her entitlement to disability living allowance under section 30;

(iv) her application for further benefit ought therefore to have been processed under the principal regulations in their unamended form.

The argument has an attractive simplicity, and for the most part is not disputed. The Department accepts that the appellant satisfies the precondition and that there has been no review of her entitlement to benefit. But the logic of the appellant's argument depends on the insertion of the words "as regards her" in proposition (ii) which do not appear in the regulation itself. That some words need to be implied is not in doubt; but the Department does not accept that "as regards her" represent the appropriate reading of the regulation.

22. I would start with the evident purpose of regulation 12. As its heading shows, it is a saving or transitional provision. Each of the paragraphs begins with the words "Where, before the coming into force of these Regulations … " It is common ground that these words are not to be taken literally. They are to be understood as meaning "immediately before", not "at any time before". Regulation 12 is concerned to save or preserve accrued rights to benefit to which the claimant was entitled immediately before the amending Regulations came into force.

23. The fact that regulation 12 cannot be read literally in this respect does not, of course, mean that the Court is at liberty to depart from the ordinary meaning of the words of the regulation in other respects: see Bank of Credit and Commerce International SA v. Ali [2001] 2 WLR 735, 757, paras 63-65 per Lord Hoffmann. But it does at least serve as a warning that the regulation is drafted in an elliptical style and that its general words are not necessarily to be given their fullest meaning and applied to every case which falls within their literal scope regardless of the context and the object of the regulation: see In re International Tin Council [1989] Ch 309, 329-330.

24. The appellant was in receipt of disability living allowance immediately before the amending regulations came into force. Accordingly, she satisfied the precondition; she possessed accrued rights which it was the purpose of the regulation to preserve. The difficulty is in relation to the operative part, and it is convenient to consider that part in the first instance without reference to the cessation provision.

25. The material words of the operative part are "those Regulations shall … have effect as if regulation … 4 … of these Regulations had not been made." Once again, this is couched in general terms which plainly cannot be taken absolutely literally. Regulation 4 is not disapplied generally. It is not, for example, disapplied in the case of other claimants. Recognising this, the appellant (in her printed case) reads in the words "as regards [the claimant]". But this is not enough. Regulation 4 is not disapplied in respect of every benefit to which the claimant may be entitled. In oral argument the appellant narrowed the expression still further by reading in the words "as regards disability living allowance". That is better, but in my opinion it is still not enough. The extent of the disapplication must be derived from the terms of the precondition and the evident purpose of the regulation. These limit it to the particular claimant's accrued right to the particular benefit which she was receiving immediately before the amending regulations came into force. In the case of the appellant, that was a right to disability living allowance under an award which entitled her to receive disability living allowance of a stated amount for a stated period of three years. That was the full extent of the appellant's accrued entitlement which it was the purpose of regulation 12(3) to save, and in my opinion regulation 4 is disapplied only as regards that entitlement.

26. Accordingly, even without the cessation provision, I would hold that regulation 12(3) does not have the effect of extending the amount or duration of a claimant's entitlement to benefit beyond the amount or term for which it was awarded. I agree with Peter Gibson LJ in R v. Chief Adjudication Officer, Ex p B [1999] 1 WLR 1695, 1706, where he said:

"I do not regard it as a serious anomaly that, on the contention which I favour, the protection of regulation 12(3) will cease with the expiry of an award for a fixed period whereas it will continue until death, whenever that occurs, in the case of an award for life. It is characteristic of transitional relief that it preserves entitlements existing at the date when the measure comes into force. It would be uncharacteristic of transitional relief to extend such relief to new rights coming into existence after the coming into force of the measure."

This passage has been criticised on the ground that transitional relief comes in so many different forms that it is impossible to generalise. But there is no need to do so. The heading to regulation 12 and the terms of the precondition are sufficient to identify the purpose of the regulation as the saving (and not the enlargement) of accrued rights. In my opinion there is no anomaly (not merely no serious anomaly) that the protection of regulation 12(3) ceases on the expiry of a fixed term award but continues indefinitely in the case of an award for life. In both cases it continues as long as it is needed to preserve an accrued entitlement but no longer.

27. If there were any remaining doubts on this score they would be laid to rest by the terms of the cessation provision. This provides that the protection of regulation 12(3) shall continue "until … his entitlement to that benefit is reviewed" under the appropriate section of the 1992 Act. In the Court of Appeal Peter Gibson LJ held that the words "entitlement to that benefit" referred to the benefit which the claimant was receiving immediately before the amending regulations came into force. The appellant disputed this interpretation, contending that the words "entitlement to that benefit" merely served to identify the particular benefit, in this case disability living allowance, rather than the other benefits referred to in regulation 12(3).

28. I consider that Peter Gibson LJ's construction is correct. Strictly speaking it is the decision under which the claimant's entitlement arises which falls to be reviewed, so this is another example of elliptical drafting. The words "his entitlement to that benefit" must be understood as a reference to the decision under which the claimant's entitlement to the particular benefit arose. This brings the cessation provision into line with the precondition; they are both concerned with the preservation of accrued rights under an existing award which predated the coming into force of the amending Regulations, but which is subject to review.

29. I think that too much may be made of the seeming capriciousness of the cessation provision. A claimant who needs to rely on regulation 12(3) will not, if well advised, seek a review however meritorious his claim to an increase in benefit; while the Department is unlikely to seek a review unless there is some evidence to support the withdrawal or reduction of benefit currently payable. In most cases, therefore, regulation 12(3) will cease to apply only when there is some reason to suppose that there has been a change of circumstances which justifies withdrawal of benefit in whole or part. Even where the adjudication officer decides that no change is warranted, his decision is based on the circumstances at the date of the review and not at the date of the original decision; so it is not unreasonable to regard it as if it were a decision on a new claim. I agree with Mr. Commissioner Rowland in case CFC/1580/1997 (which concerned the effect of regulation 12(3) on a repeat a claim to family credit) when he said, at para 34:

"It really is quite inconceivable that it should have been intended that the transitional protection should be lost on a review but not on a repeat claim."

For my part I think that the draftsman's thinking was probably the other way round. The preservation of accrued rights did not justify their enlargement by disapplying regulation 4 to new and repeat claims, and a decision on a review could properly be equated with a decision on a repeat claim.

30. As the Twelfth Report of the social security advisory committee (May 1997-March 1999) observed, transitional provisions like the present which come to an end on a specific date or on the occurrence of a specific event, such as the renewal of a claim or a change of relevant circumstances, are sometimes adopted for reasons of administrative convenience rather than in the interests of claimants. Such provisions enable the administrative burden of processing the change to be staggered. The introduction of a new "habitual residence" requirement for income-related benefits, for example, applied only where a claim for income support was made or treated as made after the coming into force of the amendment, ie to new and repeat claims: see regulation 4(2) of the Income-Related Benefits Schemes (Miscellaneous Amendments) (No. 3) Regulations 1994 (S.I. 1994/1807). In my opinion regulation 12(3) has similar effect: it preserves accrued rights to benefit under awards which pre-dated the coming into force of the amending regulations but it does not apply to new and repeat claims made after they came into force. Such claims must be decided in accordance with the circumstances obtaining at the time of the new claim and any requirements imposed by the regulations then in force.

31. I would affirm the decision in R v. Chief Adjudication Officer, Ex p B [1999] 1 WLR 1695, and dismiss the appeal.

LORD SCOTT OF FOSCOTE

My Lords,

32. For the reasons given in the opinion of my noble and learned friend, Lord Millett, with which I agree, I too would dismiss this appeal.