UK Social Security and Child Support Commissioners' Decisions

[2005] UKSSCSC CIS_4434_2004 (03 June 2005)

DECISION OF THE SOCIAL SECURITY COMMISSIONER

1. The claimant's appeal to the Commissioner is allowed. The decision of the Leicester appeal tribunal dated 2 June 2004 is erroneous in point of law, for the reason given below, and I set it aside. I substitute the decision that the appeal tribunal should have given (Social Security Act 1998, section 14(8)(a)(i)). The decision is to allow the claimant's appeal against the decision dated 13 November 2003, in relation to the period from 26 February 1992 to 25 March 1997, and to decide that the Secretary of State has failed to prove that the conditions for recoverability of an overpayment for that period were met, in that the condition in section 71(5A) of the Social Security Administration Act 1992 is not satisfied. I deal in paragraph 15 below with where that leaves the case.
2. This is one of two overpayment recoverability cases which raise the same issues. The other case is dealt with in my decision in CIS/4435/2004. Simply because the present case covers the period that is first in time, I have set out the general background and the law in this decision.
3. The claimant was in receipt of income support for a period beginning no later than 27 February 1992, the date indicated by present computer records. The award was made on the basis that she was a lone parent. Following an anonymous communication in December 2002, she was interviewed under caution on 23 June 2003 about whether she was currently living as husband and wife with a Mr F, the father of her two children, and had done so in the past. Following that interview, a decision was given on 16 July 2003 in a form that summarised the evidence on living together and concluded with this sentence:

"Based on all the above information my decision is that the customer has been living with [Mr F] as husband and wife from 26 February 1992 to 25 March 1997 and from 31 May 2001 to date."

I do not know whether and, if so, how that decision was notified to the claimant. No appeal was made against the decision.

4. On 13 November 2003, the following decision was given:

"As a result of the decision dated 16 July 2003, an overpayment of Income Support has been made from 26 February 1992 to 25 March 1997 (both dates included) amounting to £16671.98 as shown on the schedule.

On 26 February 1992 [the claimant] misrepresented the material fact that [Mr F] was living in the household as her partner when she signed form A1.

As a consequence, Income Support amounting to £16671.98 from 26 February 1992 to 25 March 1997 (both dates included), as detailed on the schedule, was paid which would not have been paid but for the misrepresentation.

Accordingly, that amount is recoverable from [the claimant]."

There was reference to various subsections of section 71 of the Social Security Administration Act 1992, including subsection (5A).

5. The claimant appealed against that decision. The case made on her behalf was that she had not at any point from 26 February 1992 lived with Mr F as husband and wife. The appeal tribunal disallowed the appeal. There was a very full and detailed statement of reasons, analysing all the evidence and concluding against the claimant on the living together question. I do not, as it turns out, need to consider whether or not the criticisms of the reasoning in the statement made on behalf of the claimant are well-founded. In paragraph 3 of the statement, the chairman rightly identified the decision of 16 July 2003 as defective, in that it did not "go on to state the consequences of the living together findings", but wrongly took the view that the appeal tribunal could, in accordance with the decision of the Tribunal of Commissioners now reported as R(IB) 2/04, remedy the defects and proceeded on the basis that there had been supersessions of the decisions awarding income support.
6. The claimant now appeals against the appeal tribunal's decision with the leave of a district chairman. The application challenged the adequacy of the appeal tribunal's reasons. I directed that the Secretary of State's submission should deal with this point:

"Did the purported `decision' dated 16 July 2003 fail to meet the conditions to count as an `outcome' decision that was capable of being appealed or of forming the basis for an overpayment decision in accordance with section 71(5A) of the Social Security Administration Act 1992, regardless of the principles set out in Tribunal of Commissioners' decision R(IB) 2/04, relied on by the appeal tribunal. See the recent decision in CIS/1720/2004 and the submission made by the Secretary of State in that case."

Section 71(5A) provides:

"(5A) Except where regulations otherwise provide, an amount shall not be recoverable under subsection (1) above unless the determination in pursuance of which it was paid has been reversed or varied on an appeal or has been revised under section 9 or superseded under section 10 of the Social Security Act 1998."

The relevant regulation is regulation 12 of the Social Security (Payments on account, Overpayments and Recovery) Regulations 1988, which provides that subsection (5A) does not apply where:

"the fact and circumstances of the misrepresentation or non-disclosure do not provide a basis for the decision pursuant to which the payment was made to be revised under section 9 of the Social Security Act 1998 or superseded under section 10 of that Act."

7. The Secretary of State's submission of 10 February 2005 in CIS/4435/2004 included the following, which, as the claimant's representative (Sonia Duncan, a senior welfare rights officer for Leicester City Council) has pointed out, has equal application in the present case:

"As the decision [of 16 July 2003] that was before the tribunal stands it is a determination on a `living together as husband and wife' issue and not a decision on entitlement. Therefore it does not satisfy the provisions of section 71(5A).

It is my understanding that where the decisions under consideration were made more than 14 months in the past any revisions or supersessions have to be made off-line. It is clear that most of, if not all, the decisions in the present case were made more than 14 months before the relevant time and therefore off-line decisions on entitlement should have been made.

I have contacted the local office to try to resolve this issue. The result of my enquiries is that no off-line decisions on entitlement were made. The overpayment decision was made, benefit stopped, as a consequence of the `living together' determination made on 16.07.03. As no decisions on entitlement have been made the provisions of section 71(5A) of the Social Security Administration Act 1992 have not been complied with.

I submit that as there was no outcome decision that superseded the entitlement decision the tribunal did not have jurisdiction to hear the appeal. I invite the Commissioner to refer the case back to the decision maker so that correct action can be taken in relation to the claimant's entitlement and any consequential overpayment and to revise the overpayment decision already made on the grounds of official error."

8. I agree with that submission, except for its final paragraph, about which I essentially agree with Ms Duncan's submission of 8 April 2005 (although there are elements of that submission which I reject).
9. The underlying reasoning is explained in my decision in appeal CIS/1720/2004. There were a number of complications in CIS/1720/2004, including that the purported appeal before the appeal tribunal there was against a living together determination, but an overpayment recoverability decision had been made later, against which there had been no appeal. The essential principle was set out in paragraph 13:

"I agree with the Secretary of State's submission of 17 November 2004 that there was no decision before the appeal tribunal that was capable of being appealed. If a decision had actually been made in the form described in the letter of 26 March 2003 ... or in the Secretary of State's written submission to the appeal tribunal, that could have been accepted as in substance a supersession decision on the ground of relevant change of circumstances, with the superseding decision being that the claimant was not entitled to income support from and including 8 April 2002. The deficiencies of an absence of any express mention of powers of supersession or of any explanation of why not being a lone parent meant that the claimant could not be entitled to income support would not have affected the substance. There would, in the current jargon, have been an "outcome decision" affecting entitlement to benefit that was capable of appeal under section 12(1) of the Social Security Act 1998. But the documents clearly show that no such decision was ever made with effect from 8 April 2002. The "decision" of 20 March 2003 on page 81 [that the income support claimant in that case was living as husband and wife with Mr A] merely determined one question, one building block, that would have been necessary along with the determination of other questions for a decision altering entitlement from 8 April 2002 to have been made. It was not a decision within the meaning of section 12(1) and therefore was not capable of being appealed."

10. I went on in paragraph 15 of the decision to suggest (in accord with the Secretary of State's submission) that the living together determination would not have satisfied the condition in section 71(5A), so that the overpayment recoverability decision, although not before the appeal tribunal in that case, could not have been upheld. I now have to decide the issue. I conclude that a determination in the form of the decision of 16 July 2003 does not satisfy the condition in section 71(5A), so that a decision that an overpayment is recoverable cannot be based on such a determination. There is no question of the application of regulation 12 of the Payments on Account Regulations, since non-disclosure or misrepresentation of facts relating to Mr F's presence in the claimant's house, if that is accepted, would plainly provide a basis for revision or supersession. It was because of the particular circumstances of CIS/1720/2004 that the result there was a decision that the appeal tribunal had no jurisdiction. Here, there had been an overpayment recoverability decision on 13 November 2003 that was appealable and had been properly appealed against. Thus the appeal tribunal had jurisdiction, but the only decision that it could have given on the evidence before it was the one I have set out in paragraph 1 above.
11. I must deal briefly with the effect of the Tribunal of Commissioners' decision R(IB) 2/04. The statements in paragraphs 72 to 82 of that decision, as summarised in paragraph 192, were made in the context of what an appeal tribunal, carrying out a rehearing, could do on an appeal against a decision that was defective in some way. It could be said that those statements should only apply where the appeal tribunal has the power to give a decision that avoids the defects of the initial decision. It is no doubt the case that an appeal tribunal has no power to "remedy" or "perfect" or "recast" a decision that is not under appeal to it, like the decision of 16 July 2003 in the present case. However, I agree with Mr Commissioner Bano in paragraphs 14 to 16 of decision CIS/3228/2003 that in such circumstances similar principles allow an appeal tribunal to ignore defects in the decision put forward as the basis of the overpayment recoverability decision, providing that those defects are not so extensive as to make the decision not a decision at all (see paragraphs 72 and 192(2) of R(IB) 2/04). I prefer not to put the distinction in terms of form and substance, as that is not consistent with R(IB) 2/04. Another Tribunal of Commissioners in R(IB) 7/04 applied the principles of R(IB) 2/04 is deciding whether decisions earlier in a chain than the decision under appeal were "so fundamentally flawed as to be inconsistent with any proper exercise of a legal power" (paragraph 18).
12. Thus, the appeal tribunal in the present case was right to consider whether defects in the decision put forward as the basis of the overpayment recoverability decision could be ignored, so that section 71(5A) would be satisfied. However, it was wrong in law to conclude that it could proceed on the basis that there had been supersessions (or revisions) of the decisions awarding income support for the periods in question.
13. It is not really appropriate to talk in terms of a defect in the decision of 16 July 2003. There was nothing wrong with it as a determination on the question of living together as husband and wife, as one building block as I put it at end of paragraph 13 of CIS/1720/2004 that might, with other determinations, have built to a decision altering the claimant's entitlement to income support. It is simply that, if is contended that the decision altered the claimant's entitlement to income support in the periods in question or was a revision or supersession within the terms of section 71(5A), it gets nowhere near having that effect. And no process of the correcting or ignoring of defects can alter that conclusion. Using the terminology of R(IB) 2/04, if it contended that the decision has that effect, it had so little connection to the legal powers produce that effect that it was not a decision of that kind at all. The decision did not purport to alter the claimant's entitlement to income support at all.
14. For the reason given above, the decision of the appeal tribunal of 2 June 2004 is set aside as erroneous in point of law. In paragraph 1 above I substitute the decision that the appeal tribunal should have given. The Secretary of State's submission of 10 February 2005 confirms that there was no other decision given that could satisfy section 71(5A) had been given.
15. The upshot for the claimant is this. First, no decision has been made that takes away her entitlement to income support for the period from 26 February 1992 to 25 March 1997. Thus no overpayment for that period can yet be identified. Second, the effect of my decision in paragraph 1 above is that there is no overpayment recoverability decision in existence in relation to that period. However, there is nothing in law to stop the Secretary of State from taking action now to make a proper revision or supersession decision in relation to that period, building on the determination of 16 July 2003. Before doing so, the Secretary of State would need to consider whether, bearing in mind the other points mentioned in my directions of 17 January 2005, there is sufficient evidence that the claimant would not have been entitled to income support or would have been entitled to a reduced amount if she had been living together as husband and wife with Mr F. If the Secretary of State does make a proper revision or supersession decision covering the period from 26 February 1992 to 25 March 1997, he may also consider making an overpayment recoverability decision properly based under section 71(5A), either as part and parcel of the revision or supersession decision or separately. The claimant would have a right of appeal against any decision or decisions that are made.

(Signed) J Mesher

Commissioner

Date: 3 June 2005