UK Social Security and Child Support Commissioners' Decisions

 


DECISION OF THE SOCIAL SECURITY COMMISSIONER

1. The claimant's appeal to the Commissioner is allowed. The decision of the Liverpool appeal tribunal dated 16 September 2002 is erroneous in point of law, for the reasons given below, and I set it aside. The case is referred to a differently constituted appeal tribunal for determination in accordance with the directions given in paragraphs 23 to 25 below (Child Support, Pensions and Social Security Act 2000, Schedule 7, paragraph 8(5)(c)).

The background

2. The appeal tribunal was concerned with the appeal against the decision notified to the claimant in a letter from the local authority dated 22 April 1999 that an overpayment of housing benefit had been made for the period from 11 July 1994 to 14 February 1999, amounting to £5,649.05, which the local authority was entitled to recover from him. The overpayment was said to have arisen because benefit had been awarded and calculated on the basis that the claimant was being provided with bed and breakfast, but was not in fact provided with any meals. The letter also said that recovery of the overpayment was being sought from the claimant's landlady as the person to whom the overpayment was made.
3. The appeal tribunal decided on the evidence, including the claimant's evidence at the hearing, that the claimant had not been provided with any meals at the relevant address, so that there were grounds to review the his housing benefit entitlement for the period in question. Its statement of reasons continued:

"There was some considerable discussion as to whether or not the provisions of Regulation 11 of the Housing Benefit General Regulations should apply in this case. On balance the tribunal is satisfied that the local authority has shown that there was suitable alternative accommodation available to the claimant without the need for any deposit. There was produced to the tribunal copies of details of both addresses in Blackpool which show that there was available accommodation which was cheaper than that occupied by the appellant in Palatine Road and it was reasonable to expect him to move from that accommodation. As noted the appellant was in fact not just sharing a room but also sharing a bed and his share of the rent was £75 a week. The appellant has been able to find other accommodation on a self contained basis following the sale of the premises at Palatine Road which was the subject of this appeal. These premises are owned by the same landlady. The tribunal has tried to have regard to all the issues concerning Regulation 11(3) which are referred to in the current edition of the guide to Housing Benefit and Council Tax Benefit Legislation. The tribunal is aware of the fact that the appellant did not have exclusive occupation of the room which he was occupying in Palatine Road. The tribunal is aware that various services in terms of electricity were provided to the appellant but there is no suggestion that these were not available in alternative accommodation or that the appellant would not himself be able to make arrangements to pay for electricity himself.

The appellant has shown by moving to different accommodation that he is able to make a move and the tribunal considers that self contained accommodation is certainly of an equivalent standard to a shared room which in fact involved sharing the bed. The tribunal was also satisfied that the appellant does not have to move out of a locality which he has known for a number of years. Blackpool, according to the evidence provided by the local authority, would appear to have a number of properties to rent of varying standards and shapes and sizes. The appellant does not have to move away from an area which was known to him and within that area the tribunal is satisfied that there was suitable alternative accommodation which was cheaper than that occupied by him in the hotel."

The relevant legislation

4. The regulation referred to in the statement is regulation 11 of the Housing Benefit (General) Regulations 1987, as agreed to be maintained in force in cases like the present where the period of benefit entitlement began before 2 January 1996. Regulation 11(2)(c) provides that a local authority is to consider:

"(c) whether by reference to a determination or re-determination made by a rent officer in exercise of a function conferred on him by an order under section 121 of the Housing Act 1988 or, as the case may be, section 70 of the Housing (Scotland) Act 1988, or otherwise, whether the rent payable for his dwelling is unreasonably high by comparison with the rent payable in respect of suitable alternative accommodation available elsewhere,

and, where it appears to the authority that the dwelling is larger than is reasonably required or that the rent is unreasonably high, the authority shall, subject to paragraphs (3) and (4) treat the claimant's eligible rent as reduced by such amount as it considers appropriate having regard in particular to the cost of suitable alternative accommodation elsewhere and the claimant's maximum housing benefit shall be calculated by reference to the eligible rent as so reduced."

Paragraph (3) provides that in certain cases, including that of the claimant here, who was incapable of work:

"no deduction shall be made under paragraph (2) unless suitable cheaper alternative accommodation is available and the authority considers that, taking into account the relevant factors, it is reasonable to expect the claimant to move from his present accommodation."

Paragraph (6) deals with relevant factors, but I do not need to set it out in full.

The evidence before the appeal tribunal

5. Thus, it is a necessary condition for reducing the amount of the eligible rent, outside cases of unreasonably large accommodation, that the rent is unreasonably high by comparison with the rent payable in respect of suitable alternative accommodation elsewhere. It is not enough that a claimant's eligible rent is higher than rents paid for suitable alternative accommodation, it must be unreasonably high by reference to that comparison. The evidence put forward by the local authority was that from the outset of the claim in July 1994 the claimant's rent was said by him and his landlady to be £65 per week. There were later increases taking the rent to £80 per week from March 1997. In a letter dated 15 June 2001 to the claimant's solicitors the local authority said that:

"The recalculation of your client's housing benefit in 1999, based on his actual tenancy details from 1994 onwards, was carried out in accordance with the law as it related to your client's claim at that time. It relied upon evidence as to comparable levels of rent for similar accommodation. This evidence is no longer held but I have attached, for your information, my computer records for similar accommodation available around that time."

The records attached, apparently from the local authority's housing benefit and council tax benefit system, showed gross rents of £25, £30, £30, £40 (rent officer determination £39.35) and £45 (rent officer determination £40). The records themselves do not appear to show any addresses or dates or information on the type of accommodation. The view that had been taken was that the claimant's rent was unreasonably high in comparison with the cheaper alternative accommodation available and that his eligible rent should be restricted to £35 per week. The result was a reduced amount of entitlement throughout the period in issue. The claimant's representative has not challenged the calculation of the consequent overpayment if that restriction was rightly imposed.

6. At the hearing on 16 September 2002 the representative of the local authority produced another five copies of computer records of rent levels from its housing benefit and council tax benefit system. These did show addresses, but only one showed a date ("11JUL94 as on 22SEP02"). The representative said that 200 claims had been examined none of which involved a gross rent of more than £50. He confirmed that all the rents were for single occupancy of a room. The gross rents shown were £25 (in the same road as the hotel in which the claimant lived), £30, £30, £40 (rent officer determination £39.95) and £50 (rent officer determination £45). At the rehearing, the claimant's representative, from his solicitors, made the point that there were no dates on the records and queried whether 10 comparators were sufficient when the local authority dealt with 30,000 claims, out of which it was not known how many were for one room only.

The submissions to the Commissioner

7. As has already been noted, the appeal tribunal disallowed the claimant's appeal and accepted the restriction of eligible rent to £35 on the reasoning set out in paragraph 3 above. The claimant now appeals against that decision with leave granted by the appeal tribunal chairman. Among the grounds put forward in the claimant's solicitors' application for leave were that the appeal tribunal made no findings on the range of rents which it accepted for suitable alternative accommodation and did not, in the light of the authority on the operation of regulation 11 relied on by the solicitors at the hearing, explain how it concluded that the claimant's eligible rent should be restricted to £35.
8. The local authority's written submission sent on 4 February 2003 did not support the appeal. The submission sought to answer the points made by the claimant's solicitors by reiterating the case it had already made on the existing evidence to support its initial decision, by making new points about the existing evidence (including in paragraph 5 that the second set of five comparators were in fact further details of the first five, as might otherwise have remained a matter of mere suspicion on examining the computer printouts) and by putting forward 91 pages of "supporting documents". These consisted mainly of copies of housing benefit and council tax benefit records relating to a number of properties at different dates from March 1993 to December 1995. The records included the names of the particular claimant in relation to each property. There was also a copy of a rent officer's decision dated 10 February 1999 in relation to the accommodation of the claimant in the present case. The referred rent was £80 per week and there was a "significantly high rent determination" at £35 per week, with the value of services outside the scope of housing benefit being £3 per week.
9. The claimant's solicitors, although they were no longer under instruction from him, made some observations in reply. These drew attention to the fact that new evidence had not been before the appeal tribunal and that the issue of the adequacy of the appeal tribunal's reasons was one of substance. The observations also contained this paragraph:

"At the Appeal hearing the appellant's representatives had cautioned the authority's representatives that the limited evidence of rents payable which had been produced placed the authority in breach of the Data Protection Act in that it readily identified the claimant's their addresses and information relevant to their claims. However, it would appear that the authority has been indifferent to that warning in that the additional evidence of rents produced also contained such information. We take the view that it is a matter in which the Commissioner may wish to comment."

10. Mr Commissioner Jacobs directed that there was to be an oral hearing of the appeal "to consider the issues raised by the appeal, especially the extent to which the Data Protection Act affects the evidence that may be considered by an appeal tribunal". He also invited the Secretary of State to become a party to the proceedings, but that invitation was declined. The oral hearing took place at Bury County Court on 6 October 2003. The claimant did not attend. As he no longer had any authorised representative, he was not represented. The local authority was represented by Alison Kilpatrick of counsel. I am grateful to her for her submissions in general and in particular those on the Data Protection Act.
11. Ms Kilpatrick submitted that the appeal tribunal had not gone wrong in law. She accepted that criticisms could be made of its treatment of the evidence and of its reasoning, but submitted that the appeal tribunal had done enough for the claimant to know why it had decided against him. She said that it did not matter that the appeal tribunal did not set out the chain of reasoning by which it accepted that the claimant's eligible rent should be restricted to £35 per week. She also said that it did not matter that the details of only five comparable properties had been put forward, when the appeal tribunal had been told that the details were of 10 properties. What mattered was that the details showed the existence in the local market of room-only tenancies at the rents shown. Nor was the claimant disadvantaged by only learning of the addresses of the comparable properties on the day of the hearing. He had a skilled representative, who brought forward no evidence of his own about rents for comparable properties and made no suggestion that he would have wished to visit or investigate the particular properties put forward by the local authority.

The Commissioner's decision

12. There is force in those submissions, but I reject them. There is a series of issues of judgment to be addressed under regulation 11(2)(c), even if a rent officer has made a determination to the effect that a rent paid is significantly higher than the market rent (specified at a certain amount). The different issue of whether the claimant's rent is unreasonably high by comparison with suitable alternative accommodation must be addressed. If the answer there is yes, it must be asked what the appropriate amount is of the reduction which has to follow (subject to regulation 11(3) to (4)). The local authority had not in its written submission to the appeal tribunal or in earlier letters spelled out its view on those issues. The appeal tribunal did not do so either.
13. Now, it may be that, whatever might be said about the limitations of the comparables put forward by the local authority, the disparity between what was paid by the claimant for a share of a single room and the rents for alternative accommodation was so great that there could not properly have been any other conclusion except that his rent was unreasonably high. I shall therefore not say any more about that issue. But there was still the issue of the exercise of discretion on the appropriate amount of the reduction. The "alternative" rent forms a floor below which the eligible rent cannot be reduced, but the reduction need not be to that floor (see Lord Bingham in R v City of Westminster Housing Benefit Review Board, ex parte Mehanne [2001] UKHL 11 [2001] 1 WLR 539, at 543). It seems to me (by reference to the authorities mentioned in the notes to the "old" regulation 11 on pages 294 to 297 of the 2002/2003 edition of CPAG's Housing Benefit and Council Tax Benefit Legislation) that the question of the range of rents in the market is relevant to this issue. If in the present case there was a wide range of rents, even though there was sufficient evidence to support £35 as a rent for suitable alternative accommodation, that could affect the decision as to the amount of the reduction in the eligible rent. In my judgment, it did matter that the appeal tribunal was wrongly informed that 10 comparables had been put forward when there were in fact only five. It also mattered that the appeal tribunal had no evidence as to the dates of the rents, when the alleged overpayment covered a period of more than four years. A judgment that the eligible rent ought to be reduced to £35 as at July 1994 might not necessarily hold good as at February 1999.
14. For all those reasons, I conclude that the appeal tribunal needed both to recognise that there was an issue before it as to the appropriate amount of the reduction and to give some explanation of the reasoning supporting the conclusion that the reduction throughout the period of the overpayment should be to £35 per week. The appeal tribunal failed on both counts and thereby erred in law.
15. The claimant's representative had made submissions to the appeal tribunal about the restricted number of comparators and the dates to which the evidence related. The appeal tribunal needed to say what it made of those specific contentions in relation to regulation 11 (see paragraph 13 of Commissioners' decision R(I) 18/61), but did not do so. That is an additional reason why its statement of reasons was inadequate and its decision was erroneous in law. I do not then need to enter into the dispute as to whether the claimant's solicitor did or did not secure an admission from the local authority's representative at the hearing on 16 September 2002 that the range of rents in Blackpool for single room accommodation could exceed £80 per week.
16. For the reasons given above, I set aside the appeal tribunal's decision of 16 September 2002 as erroneous in point of law. The claimant's appeal against the decision issued on 22 April 1999 is referred to a differently constituted appeal tribunal for determination in accordance with the directions given below.

The Data Protection Act 1998

17. For the purpose of those directions I need to consider the relevance and effect of the Data Protection Act 1998, in accordance with Mr Commissioner Jacobs' direction. However, what I can say is fairly limited. That is because I accept Ms Kilpatrick's submission that, even if the disclosure of addresses in relation which a housing benefit claim had been made and of the names of claimants was an offence under the Act or might enable the individuals concerned to claim compensation from the local authority (which she did not accept was the case), that did not prevent an appeal tribunal taking into account evidence which involved such disclosure. She stressed that the Act does not give any rights to third parties, such as the claimant in the present case, or create liabilities except on the part of data controllers under the Act. Subject to the proviso that I have not heard anyone making a case to the contrary, I am inclined to agree.
18. The approach is in line with that of Mr Commissioner Jacobs in R(DLA) 4/02. He was concerned there with videotape evidence which had been obtained covertly, in a way which was argued to have contravened a claimant's right to respect for her private and family life and home, contrary to Article 8(1) of the European Convention on Human Rights. He in fact found that there was no breach of Article 8(1), but said this about the impact of Article 6 (right to a fair trial) in such cases:

"24. That case [R v P [2001] 2 All ER 58, House of Lords] is authority for these propositions. As a general rule, Article 6(1) is not concerned with the admissibility of evidence, which is a matter for domestic law. So, the manner in which evidence was obtained does not of itself involve a violation of Article 6(1). That provision is concerned with whether the proceedings as a whole were fair. The key considerations are whether the claimant had the chance to challenge the authenticity and use of the evidence."

I add that some of the European Court of Human Rights cases discussed in R v P establish that where evidence obtained in breach of Article 8 is used in a criminal trial, any remedy for that breach lies outside the scope of the criminal trial itself (although there are powers in section 78 of the Police and Criminal Evidence Act 1984 for the court to exclude evidence if it admission would adversely affect the fairness of the proceedings).

19. Similarly, in Jones v University of Warwick [2003] EWCA Civ 151 [2003] 3 All ER 760 the Court of Appeal held in a personal injuries case that (subject to a defendant's conduct being so outrageous that the defence should be struck out altogether) that:

"it would be artificial and undesirable for the actual evidence [obtained in breach of Article 8(1)], which is relevant and admissible, not to be placed before the judge who has the task of trying the case."

The court suggested there the use of the weapon of ordering a guilty party to pay costs, to discourage conduct contrary to Article 8. That weapon is not available in housing benefit or social security cases before appeal tribunals or Commissioners. However, the principle remains that if evidence is relevant to an issue before an appeal tribunal and is of probative value, it must be taken into account even if it was obtained in breach of some domestic law or even something as fundamental as the European Convention on Human Rights, providing that the overall proceedings are fair.

20. In the light of that conclusion, I need not and should not express any decided views on whether there was any breach of the Data Protection Act 1998 involved in the provision of evidence by the local authority on rents for comparable properties. I do not think that there is any doubt that the data held by local authorities in relation to housing benefit and council tax benefit claims constitute personal data. The disclosing of some part of that data in evidence to an appeal tribunal could therefore potentially breach the first data protection principle under the Act, that data is to be processed fairly and lawfully and is not to be processed (which includes disclosure) unless one of the conditions in Schedule 2 to the Act is met. Here, the local authority might say that processing was necessary for the administration of justice, for the exercise of functions of a public nature in the public interest or for the purpose of its legitimate interests.
21. However, Ms Kilpatrick submitted that one or more of the statutory exemptions from the Schedule 2 conditions applied. These were section 34 (where legislation requires a person to make information public) and section 35 (where disclosure is necessary for the purpose of or in connection with legal proceedings or for the purposes of establishing, exercising or defending legal rights). She relied on section 34 in so far as information was disclosed from the registers kept by rent officers. I am too ignorant about how far such registers are open to the public to say any more about the application of section 34.
22. Under section 35 it is clearly arguable that in order properly to defend its position in an appeal like that of the claimant's it is necessary for a local authority to disclose at least certain elements of the personal data held in housing benefit and council tax records, in order to provide evidence of market rents for similar properties in a case of a potentially unreasonably high rent. It seems to me that that might apply to information on dates, type of property, services provided, rent and the location of the property, if not the address itself. That could be said to be necessary to allow the appeal tribunal to make the necessary judgments and for the claimant to know the case against him properly. However, there would be very great difficulties, at the least, in stretching that argument to cover disclosure of the names of the claimants involved. Any consideration of what would be necessary in providing worthwhile evidence would have to take account of what the Master of the Rolls, Sir Thomas Bingham, said in R v Housing Benefit Review Board for East Devon District Council, ex parte Gibson (1993) 25 HLR 487 at 494:

"[I]t has been repeatedly said that it is not part of the local authority's function and no part of the Review Board's function to identify specific property available for a recipient's occupation. Speaking for myself, I unreservedly accept that. Neither the local authority nor the Review Board is an accommodation agency; neither of them can be expected to assume what would be an inappropriate role. A situation should never arise, therefore, where the local authority or Review Board is in the position of saying: `Number 3, Laburnum Avenue is the same size as the house you are now occupying, it is available for letting at a rent substantially below that which you are now paying; why do you not move there?'... Moreover, it must be borne in mind that details of payments of housing benefit are confidential matters and it can therefore never be incumbent on local authorities to disclose the names or the addresses of beneficiaries to whom the benefit is paid. It is, in my judgment, quite sufficient if an active market is shown to exist in houses of the appropriate type in an appropriate place at the level of rent to which rent is restricted. ... It is, however, sufficient, as I wish to stress, to point to a range of properties, or a block of property, which is available without specific identification of particular dwelling-houses."

What the Master of the Rolls said about confidentiality should have been taken into account by local authorities regardless of the provisions of the Data Protection Act, but the whole statement is relevant to what it might be necessary to disclose.

Directions to the new appeal tribunal

23. There must be a complete rehearing of the claimant's appeal against the decision issued on 22 April 1999 on the evidence presented and submissions made to the new appeal tribunal, which will not be bound by any findings made or conclusions expressed by the appeal tribunal of 16 September 2002. That is subject to something happening to bring the appeal to an end, such as a withdrawal by the claimant or a striking out of the appeal.
24. For the avoidance of doubt, I confirm that the claimant had a right of appeal against that decision, although the local authority had indicated that actual recovery of the alleged overpayment was being sought only from the claimant's landlady, because the decision was that the overpayment was legally recoverable from him. I also confirm that the issue of the amount of the overpayment, in the sense of determining how much housing benefit the claimant ought properly have been entitled to, so as to calculate the difference between that amount and the amount actually paid, is properly part of that appeal (see paragraphs 49 and 50 of the Tribunal of Commissioners' decision in CH/521/2001, CH/841/2002 and CH/3880/2002). In the light of what I have said above about the Data Protection Act and about confidentiality, the local authority may wish to consider whether to withdraw from the evidence to be put to the new appeal tribunal the documents attached to its submission of 4 February 2003 and to consider afresh what evidence and in what form it should put to the new appeal tribunal about market rents throughout the period of the alleged overpayment. The new appeal tribunal should follow the principles set out in paragraphs 17 to 19 above in relation to the admissibility of evidence.
25. I also confirm that, as the whole of the decision of the appeal tribunal of 16 September 2002 has been set aside, the issue of whether or not the claimant was provided with breakfast or any other meal is open for decision afresh, as well as the possible application of regulation 11 of the Housing Benefit (General) Regulations 1987, depending on the view taken on the first issue. I do not need to give detailed directions about the interpretation of regulation 11. The new appeal tribunal should take into account the points made in paragraphs 12 to 16 above and ensure that all relevant issues are considered. The evaluation of all the evidence before it will be entirely a matter for the judgment of the new appeal tribunal. The decision on the facts in this case is still open.

(Signed) J Mesher

Commissioner

Date: 28 November 2003