UK Social Security and Child Support Commissioners' Decisions

[2005] UKSSCSC CSCR_795_2004 (22 April 2005)

THE SOCIAL SECURITY COMMISSIONERS

Commissioner's Case No: CSCR/795/2004

SOCIAL SECURITY ACT 1998

APPEAL FROM THE APPEAL TRIBUNAL UPON A QUESTION OF LAW

COMMISSIONER: L T PARKER

Oral Hearing

Appellant: Respondent: Secretary of State

Tribunal: Glasgow Tribunal Case No:

DECISION OF SOCIAL SECURITY COMMISSIONER

Decision

1. I allow the compensator's appeal in part. I set aside the decision of a tribunal sitting in Glasgow on 5 February 2004 (the tribunal) and I substitute my own decision.
2. I specify the following as the variation to be made on the issue of a fresh certificate:

The certificate of recoverable benefits in issue before the tribunal is confirmed except that payment of industrial injuries disablement benefit (IIDB) made for the periods from 17 February 1998 to 17 October 1998 and from 17 October 1999 until 4 November 2002 (the end of the relevant period) is not recoverable from the compensator by the Secretary of State and applicable relevant amounts are therefore to be removed from the certificate; additionally, for the period from 18 October 1998 to 16 October 1999, the correct assessment of IIDB was 20% after offset of 5% and the fresh certificate should reflect the adjusted figure.

Background

3. This appeal arises out of the recovery from the compensator by the Secretary of State of benefits paid to the claimant following an accident at the latter's place of work on 4 November 1997. The claimant slipped at work on a wet floor, fell onto his left side and subsequently complained of injury to his back. He never worked thereafter although from 1959 to 1968 he had worked as a miner, from 1968 to 1976 as a hairdresser and from 1976 until the date of the accident (the relevant accident) as a school janitor.
4. The claimant sued his employers in respect of the accident and received compensation. The case was settled, as so often happens, at the door of the Court. The compensator wanted to settle for a sum of £5,000, representing solatium for a physical injury lasting 6 weeks to a couple of months but without inclusion of a psychological component. Counsel for the pursuer first suggested £15,000 but, when this was rejected, proposed £10,000, inclusive of interest, and this was the sum accepted by both parties in settlement.
5. Various medical reports had been commissioned on behalf of the compensator and of the claimant and these were produced to the tribunal. Those reports substantially agree that the substantial damage in the claimant's case is psychological rather than physical and, furthermore, that the claimant had pre-existing such problems, but differ in the extent to which it is considered that the claimant has nevertheless suffered disablement attributable to the relevant accident.
6. The Secretary of State recovered from the compensator the social security benefits paid to the claimant during the first five years after the relevant accident. These constituted incapacity benefit (IB) and IIDB. The total amount paid to the Secretary of State by the compensator was £20,902.05. The compensator appealed to the tribunal.
7. S.11 of the Social Security (Recovery of Benefits) Act 1997 (the 1997 Act) sets out the following grounds for such an appeal:

"11. (1) An appeal against a certificate of recoverable benefits may be made on the ground—

(a) that any amount, rate or period specified in the certificate is incorrect, or

(b) that listed benefits which have, or are likely to be, paid otherwise than in respect of the accident, injury or disease in question have been brought into account, or

(c) that listed benefits which have not been, and are not likely to be, paid to the injured person during the relevant period have been brought into account, or

(d) that the payment on the basis of which the certificate was issued is not a payment within section 1(1)(a)."

8. The compensator submitted to the tribunal that grounds (b) and (d) were relied upon. However, these grounds were misquoted, significantly so in relation to sub-paragraph (d). It was incorrectly stated that this read:

"The compensation payment made was not as a consequence of the accident, injury or disease in question."

9. Notwithstanding, from the thrust of the submission, it was apparent that the crux of the compensator's argument was that benefit had been paid otherwise than in respect of the relevant accident (i.e. the reliance was on sub-paragraph (b)) because, it was contended, payment of benefit had been for psychological reasons and these were not due to the relevant accident but to a pre-existing condition. The appeal sets out points in support of that from the various medical reports and continues:

"… it is also submitted that the compensation payment was not as a consequent [sic] of the accident … in question.

…

In this case, the injured person was paid compensation for physical injury but paid benefits for psychological problems and a persisting physical injury. Since the two payments had been made for differing reasons, this case does not fall within the scope of Section 1 of the 1997 Act and the compensation payment was not as a consequence of the accident, injury or disease in question. Accordingly, the Certificate of Recoverable Benefits ought to be reduced to nil."

10. Before the tribunal, in addition to the medical reports obtained for the court case, was the evidence relied on by the Secretary of State in awarding the benefits in issue. Insofar as the indefinite award of IB is concerned, reports from the claimant's general practitioner (GP) gave "depression 1995 and back pain 11/1997" as the significant conditions. IB was awarded after examination of the claimant on 9 September 1998 by a medical adviser (MA) who advised that the claimant had "a severe mental illness", (in effect, exempting him from application of the personal capability assessment (PCA) under regulation 10 of the Social Security (Incapacity for Work) (General) Regulations 1995). In a questionnaire completed by the claimant on 30 November 1999, he narrated both physical and psychological problems: an MA advised that the claimed level of disability was consistent with the medical evidence and a decision maker (DM) on behalf of the Secretary of State continued the award of IB on 13 December 1999 by accepting physical descriptors in excess of the necessary 15 points. Finally, a tribunal on 10 December 2001 held that the claimant passed the PCA under mental health descriptors.
11. The three relevant sets of advice by doctors with respect to the discrete awards of IIDB are in the papers. On 14 April 1998 a doctor (acting then as an adjudicating medical authority (AMA)) assessed the claimant's disablement at 5% for impaired spinal function and 10% for impaired social function, on a provisional basis. It is recorded that the AMA was told by the claimant, "I have never had problems with my back or depression previously". An AMA on 9 September 1998 considered his depression to be much worse and assessed at 20% for the impaired social function, with a continuing 5% for impaired spinal function, and again on a provisional basis and without offset. Finally, a doctor on 22 September 1999 advised that a life assessment was appropriate, repeating 5% for impaired spinal function but once more choosing a figure of 10% for social dysfunction.

The tribunal hearing and decision

12. No presenting officer appeared on behalf of the Secretary of State, which seems astonishing in view of the money involved. Miss Sarah McKinnon, Solicitor, appeared on behalf of the compensator. The tribunal confirmed the certificate of recoverable benefits issued on 14 May 2003.
13. Its facts and reasons were these:

"The issue before the tribunal was whether or not all or any of the benefits were paid in consequence of the accident.

There was no doubt that the accident occurred. The medical reports contained in the papers both [sic] accepted that the appellant had problems. In a sense the medical reports 'pointed the finger' at the other discipline. The tribunal were satisfied that all the appellant's problems physical and mental flowed from the accident. If he had not had the accident, he would not have suffered the various problems. The tribunal therefore concluded that all the injuries flowed from the accident and that benefit had been paid in consequence of the accident."

Appeal to the Commissioner

14. The grounds of appeal to the Commissioner rely solely on s.11(1)(d) of the 1997 Act, although again misquoted. It is submitted:

"The award takes no account whatsoever of psychological problems and the fact that this award was accepted by [the claimant] indicates his willingness to concede that the psychological problems cannot be related to the accident in question."

15. The compensator concludes:

"… the tribunal's decision is unjust and inequitable and breaches the compensator's human rights … If the Secretary of State is entitled to include in a certificate all benefits which have been paid, even if they ought not to have been paid, the scope of appeal for a compensator is narrow …"

16. The Secretary of State does not support the appeal. The Secretary of State says:

".. the tribunal has properly balanced the evidence and has come to the conclusion which it was entitled to reach namely that the benefits were paid in respect to the accident and, thus, there is no error in law."

17. The Secretary of State assumes that it is Article 6 of the European Convention on Human Rights (the Convention) which it is argued is infringed. The Secretary of State submits that, so far as any DM's decision is concerned, there is not at that point a relevant dispute; in any event, at the tribunal stage there is the required full and fair hearing, in particular because (as was confirmed in R(CR)1/02 by a Tribunal of Commissioners) a tribunal is entitled to reach a conclusion that is inconsistent with the award of benefit.
18. In response, the compensator takes a different tack with respect to human rights:

"The compensator has no control over what benefit is paid for when an award is made and they are not party to the original assessment. Whilst a Tribunal must take account of a court decision, they need not follow it. Further, where there has been no court decision, a Tribunal is not obliged to consider the terms of any negotiated settlement. Accordingly, the compensator is unable to have a fair hearing as the issue in question is something already decided. If a claimant loses their Court action, the CRU Certificate will be reduced to nil. On the same basis, if the disposal of a case is qualified, the qualifications should also be considered by the DWP in assessing the recoverable benefits to be met by the compensator.

…

… In reaching their decision, the Tribunal considered that the accident in question was a trigger-point and the injured person was entitled to recover benefits for all physical consequences stemming from this accident. This is different to the legal principles regarding liability used by a compensator in assessing any potential liability. For example, a court is entitled to reduce an award of damages to take account of any contributory negligence. This is something which, in terms of the legislation, a decision maker will not take into account. Thus, an award by a decision maker (or any subsequent appeal) is made with consideration to different principles to those used by the court, making it impossible to reconcile the position. The legislation is therefore inequitable and unjust and contrary to the Compensator's human rights."

The oral hearing

19. Both the compensator and the Secretary of State requested an oral hearing before the Commissioner and that was directed by the Legal Officer to the Commissioners. Such hearing was held on 20 April 2005. The appellant compensator remains represented by Miss Sarah McKinnon, Solicitor, and the Secretary of State was represented by Mr Colin Brown, Solicitor, of the Office of the Solicitor to the Advocate General. Both parties adhered to their written submissions, apart from responses to queries from me. I am grateful to both for their assistance.

My conclusion and reasons

20. The following three points made on behalf of the compensator are, in my view, lacking in any merit.

Breach of human rights

21. It is inappropriate to argue a breach of human rights without identifying which article of the Convention is in issue and without specificity as to the nature of the breach, or reference to authority.
22. So far as Article 6 is concerned, this relates to the procedural guarantees of a fair hearing on all relevant points. It has nothing to say about substantive fairness. Therefore, a perception by a party that legislation is "inequitable and unjust" does not fall within the terms of Article 6, and there is no suggestion that another article embodying a substantive right is in issue.
23. It is well recognised by the jurisprudence of the European Court of Human Rights (see for example Edwards v United Kingdom: (1993) 15 EHR R 417 at paragraph [34]) that, in deciding whether proceedings are fair, the whole judicial process must be looked at, including the decision of any appellate body. The compensator was not bound by the proceedings between the Secretary of State and the claimant. In the hearing before the tribunal, it was open to the compensator to raise any evidence or argument relating to the crux of the compensator's assertion, which was that benefit was paid primarily for psychological disablement and that such was not due to the relevant accident. Even if the compensator could make no comment at the stage of the award of benefit to the claimant, and irrespective of any difference between the approach of a court to giving damages and of the Secretary of State in the award of benefit, this in no way detracts from the ambit of a full and fair hearing which a compensator is afforded before a tribunal dealing with matters under the 1997 Act.

S.11(1)(d) of the 1997 Act

24. This is set out above at my paragraph 7. The text refers back to s.(1)(a); the full text of s.(1) is as follows:

"1. (1) This Act applies in cases where—

(a) a person makes a payment (whether on his own behalf or not) to or in respect of any other person in consequence of any accident, injury or disease suffered by the other, and

(b) any listed benefits have been, or are likely to be, paid to or for the other during the relevant period in respect of the accident, injury or disease."

25. Misquoting s.11(1)(d) has rendered the compensator's argument under that heading misguided. There is no serious suggestion, nor could there be, by the compensator that there has not been any compensation payment made to the claimant within the terms of s.1(1)(a); the implication of the argument put arises solely under s.1(1)(b), for which appeal is provided by s.11(1)(b). S.11(1)(d) of the 1997 Act encompasses those cases where it is argued that, although the compensator made a payment, it related only to economic loss.

The relevance of any settlement

26. S.12(3) of the 1997 Act reads as follows:

"12. …

(3) In determining any appeal under section 11, the tribunal must take into account any decision of a court relating to the same, or any similar, issue arising in connection with the accident, injury or disease in question."

27. While the court's view must thus be taken into account by any tribunal considering an appeal against a certificate of recoverable benefits, it is not determinative. It follows that a settlement does not have to be taken into account and, most certainly, is not conclusive. No set of proceedings can bind a person who is not a party to them. However, this does not mean that regard may not be had to the basis on which a claim for compensation was settled; but the weight to be given depends upon what is known about it and any relevance the settlement in fact has to the issues before the tribunal.
28. The tribunal did not have a copy of the note dated 1 July 2003 which records the compensator's views on the settlement reached and could not, therefore, err by failing to take account of evidence not before it. But, in my judgement, the note merely underscores that the settlement was of little help on the questions arising under compensation recovery; settlements often represent a compromise and yet are rarely crystal clear on exactly what has been accepted by each party. In particular, in no way does this settlement support an argument that the sum paid related purely to solatium for a physical injury lasting six weeks to a couple of months, given that the compensator's own evidence was that £5,000 was that figure; this is so even if the agreed payment did not, in the compensator's view, amount to a sum appropriate for a significant injury, including a psychological component. As with most settlements, it amounted to what both sides considered was a reasonable disposal in all the circumstances.
29. The compensator's argument that because, if a claimant loses in court, the certificate is reduced to nil, then it follows that qualifications in the settlement should also be included in assessing recoverable benefits, is obviously fallacious. In the former case, there is no compensation payment to which the 1997 Act can apply. Where there is such a compensation payment, however, the salient point is that the judgement of a court giving damages or the terms of a settlement or the view of an authority awarding benefit, are all evidentially relevant to determining whether benefits listed in the certificate of recoverable benefits were paid "in respect of" the relevant accident, albeit not conclusive; what weight an adjudicating authority attaches depends upon the nature of the evidence in question.

Errors of law

30. Although neither contention was raised by the parties, I judge that the tribunal erred in law in two ways. As the Commissioners' jurisdiction is inquisitorial (as is that of the tribunal from which appeal to the Commissioners is taken) I consider not only the submissions made by the parties but must identify any errors of law if they clearly arise on the material before me.

Inadequate reasons

31. Given the number of contrasting medical reports, the tribunal might be regarded as having failed even to attempt to weigh the evidence let alone address the issues, but certainly its findings and reasons are short, vague and lacking in any specification. A tribunal need not be over elaborate but a party should be able to discern the reasons why its evidence or argument has failed to satisfy an adjudicating authority. That duty has been breached in the present case.
32. I am particularly surprised that neither party has commented adversely on the absence of proper findings and reasons because each produced an authority which is relevant. In CCR/5336/1995 (lodged by the Secretary of State), Mr Commissioner Rowland said the following at paragraph 13:

"Ultimately, the question that had to be answered in the present case was whether, had the appellant not suffered the relevant accident, he would have been incapable of work by reason of the dumping syndrome alone, or whether his incapacity only arose because the effects of the dumping syndrome were combined with the effects of the shoulder injury. Except for Dr Bennett's 1992 report, all the medical evidence is equivocal on that issue. The decision reached by the tribunal was one that was open to them on the evidence but they were not entitled to reach it on the basis that the evidence all pointed in one direction and without recording their own findings as to the respective effects of the shoulder injury and the dumping syndrome and making it clear that they were really deciding that the dumping syndrome alone would not have rendered the appellant incapable of work."

33. At paragraph 5 of CCR/3806/2000 (produced on behalf of the compensator) the same Commissioner said:

"Their reasoning on the facts does not grapple with the compensator's argument and, indeed, seems to misunderstand it. The compensator accepted that the claimant had suffered an accident but, contrary to what the tribunal appear to have believed, it was not accepted that the accident caused any continuing disablement, at any rate from August 1996 which is the date from which benefits were recovered … it was the compensator's case that the claimant had had back pain before the accident and that the medical reports made in connection with the claims for benefit were made in ignorance of that fact."

34. He cotinued at paragraph 7:

"…What was in issue was whether the relevant accident was an effective cause of the back pain during the period in respect of which the relevant benefits were paid. As in R(CR) 1/01, that was an issue the tribunal were obliged to determine and they were obliged to give proper reasons for the determination."

Offset

35. Provided a claimant reaches the relevant threshold, IB is payable without reduction (although at a rate dependent on how long the claimant has been in receipt of the same). Therefore, unless the compensator can show that the claimant would have satisfied the relevant threshold during the period in issue, even if the relevant accident had not occurred, the whole of IB is a benefit paid in respect of the relevant accident. But that is not the case with disablement benefit because its rules of entitlement allow apportionment and then offset to take into account disablement to which the claimant would have been subject even had the relevant accident not occurred. The rules for industrial injuries benefit are thus crucially different from those for IB in their impact on benefit recovery.
36. Again, as Mr Commissioner Rowland put it at paragraph 5 of CCR/3806/2000:

"When first examined in connection with her claim for disablement benefit, the claimant is recorded as expressly having told the adjudicating medical authority that she had had not previous back troubles … Her medical notes, as recorded by the consultants, show that she had had considerable problems in the year before the relevant accident. At the very least it was insufficient for the tribunal to rely upon the apparent acceptance by those examining doctors of the claimant's attribution of her troubles to the relevant accident, without explaining why they rejected the compensator's argument that the evidence of the claimant's pre-accident symptoms undermined the evidence. Furthermore, if, as appears to be the case, the tribunal were of the view that the claimant's disablement was due both to the relevant accident and to constitutional causes, they should have considered whether the assessment of 16 per cent had properly been made by the adjudicating medical authorities, having regard to regulation 11(3) of the Social Security (General Benefit) Regulations 1982 (requiring there to be taken into account only disablement to which the claimant would have been subject if the relevant accident had not occurred), and therefore whether disablement benefit had properly been awarded to the claimant."

37. In the present case, it is recorded that the claimant told the first adjudicating medical authority:

"I have never had problems with my back or depression previously."

It is, however, now accepted that he did have previous psychological problems which, on the evidence, had caused him earlier "impaired social functioning", the disablement taken into account for IIDB purposes.

38. It is unfortunate that the compensator's representative did not pick up the potential impact of regulation 11(3) of the Social Security (General Benefit) Regulations 1982 and focus the evidence for the benefit of the tribunal. However, the matter patently arose from the information before it and the tribunal ought correctly to have considered whether the assessments were properly made. It erred in law in not so doing.

Substitution of my own decision

39. I have all the medical reports before me so that it makes sense for me to substitute my own decision in order to save further delay and expence. Neither party objected to that course of action when I suggested at the oral hearing that might be my approach.
40. The burden of proof lies on the compensator to show that the benefits were paid "otherwise than in respect of" the relevant accident. The compensator therefore has to show that there is no connection with the relevant accident sufficient to justify the inclusion of any particular benefit, in whole or in part, in the certificate of recoverable benefits (and the Secretary of State has complied with the prior evidential duty to show a prima facie link in the present appeal). In determining whether the compensator's onus is discharged one is matching the conditions of entitlement to the benefit in question, and all its aspects, with the relevant accident. For example, a compensator is free to argue that there is no causal link, or that the disablement is exaggerated, or that there is no sufficient connection throughout the relevant period, or that (if appropriate) the rate awarded is wrong, or any other matter pertinent to whether benefit was not so paid.
41. I have carefully considered all the medical evidence. The orthopaedic surgeons on both sides agree that it is the psychological condition of the claimant not his physical condition which predominates. The consultant psychologist (on behalf of the claimant) and the consultant psychiatrist (on behalf of the compensator), agree that there were pre-existing problems. However, there is no consensus as to whether his psychological condition would have been the same in the relevant period, even had the relevant accident not occurred, or at least sufficient on its own to result in payment of all the benefit in issue.
42. I find the consultant psychiatrist's report much less persuasive than that of the consultant psychologist. The consultant psychiatrist concludes that there is no "discrete psychiatric illness", a conclusion which I consider insufficiently reasoned having regard to his acceptance of "depressed mood, symptoms of anxiety and [the claimant's] persecutory view of others"; moreover, the consultant psychiatrist is of the opinion that:

"… the accident has not led to any long-term additional psychological effect which would limit his ability to return to work."

Yet all the other medical evidence in the case, including the contemporaneous medical examinations by several doctors for the purposes of IB and IIDB was that his mental state was fragile.

43. Moreover, while the consultant psychiatrist is right that there are inconsistencies in the claimant's evidence about well how he had coped with work before the relevant accident, the consultant psychiatrist pays insufficient regard to the length of the claimant's work record when contrasted with his total failure to work thereafter. I find more convincing the opinion of the consultant psychologist:

"[The claimant] has what is termed a brittle personality that is that while he may be getting along quite well, he will react significantly to any upset or negative experience. In addition, it is likely that [the claimant] used employment to find affirmation of himself. We have seen that he has a very low opinion of himself, a state that has been with him since childhood. He was able to deal with this through employment. During the interview he repeatedly mentioned that he had been a very hard and consistent worker. 'I was a janitor for twenty one years. No matter what, I always went to work. I bet no one had a record like mine work wise. Life is about working.' Clearly this is a man who holds the ability to work in the very highest priority. It is the author's opinion that [the claimant] used work as a form of self-defence and a source of self-esteem. Thus, when he found himself unable to work there was a catastrophic reaction. His reaction was not to the injury itself, but to the consequence of the injury: he couldn't work. In one moment he lost his source of self-esteem and he lost his defence mechanism against psychological problems. In addition, his brittle personality and difficulty in dealing with setbacks exacerbated his response. A year later, matters were to be made even worse when he was finally paid off."

44. Both the consultant psychologist and the consultant psychiatrist, (as also does Professor Waddell, the orthopaedic surgeon instructed on behalf of the claimant in his legal action), note that he does not display "the typical pattern of psychological reaction and illness behaviour gradually developing secondarily to a physical injury, but appears to be a primary psychological/psychiatric condition" (see Professor Waddell's report of 18 April 2000). However, whereas the consultant psychologist provides a plausible explanation in which the relevant accident plays, nevertheless, an essential link for at least part of the subsequent history, the consultant psychiatrist does not address why a dramatic deterioration seemingly occurred after the relevant accident yet was not connected to it. The consultant psychologist's report, as more coherent and complete, is likewise more compelling.
45. I also consider that regard must be paid to Professor Waddell's conclusion in his second report of 3 March 2003:

"[The claimant] may reasonably continue to have some entirely genuine physical pain in his lower back, which can persist or recur for an indefinite period after such an injury, which is consistent with the objective clinical findings, and which I consider is attributable to the reported accident of 4 November 1997."

Mr McMaster, the compensator's reporting orthopaedic surgeon, on essentially the same objective clinical findings, in his report of 28 April 2003, makes no comment on whether there is any possibility of such continuing "genuine physical pain".

46. From all the evidence, throughout the relevant period the claimant fulfilled the statutory criteria for IB solely on account of his mental health condition. It is correct that in the middle of three decisions, a DM continued to award on the basis of physical descriptors; but, in my judgement, the DM was wrong to do so. The DM was following the opinion of a medical adviser which said only that the claimed level of disability was consistent with the medical evidence. However, the totality of the medical evidence confirms that the claimant's physical problems (as set out by him in his questionnaire) were primarily psychosomatic and, in reality, mainly due to mental health problems. However, the compensator has not satisfied me on the balance of probability that those mental health problems were not due, at least in part, to the relevant accident. As is trite law, a compensator takes the victim as he finds him. The claimant was certainly a damaged man psychologically prior to the relevant accident, but it was the relevant accident which triggered devastating consequences so that he fitted the necessary threshold mental health descriptors throughout the relevant period.
47. However, IB is paid at one rate (subject to duration) and therefore, as I have concluded that such benefit would not have been paid but for the accident then, even though there were other causes which were constitutional and pre-dated the accident, the payment of IB was nevertheless therefore to be attributed to the accident in full. But apportionment is possible with respect to IIDB when disablement is due both to the relevant accident and to some other cause. From the undisputed evidence of a pre-existing psychological condition, which was not before the adjudicating medical authorities, it seems more probable than not that the claimant would have had an element of impaired social function in the relevant period, albeit not the devastating consequences he in fact sustained, even had the relevant accident not occurred. In my view, an offset of 5% was appropriate at all times, which has the result that, outwith the period when a 25% gross assessment was awarded, no payment of IIDB was right because the net assessment fell below the 14% threshold; furthermore, the 25% gross figure for the year it was paid, correctly becomes 20% net and the claimant's award falls into a lower band. There is nothing, however, to indicate that the wrong assessment bands were chosen so far as the estimate of total disablement is concerned.

Summary

48. For the above stated reasons, the tribunal's decision is erroneous in law, which justifies its set aside. I have further substituted my own decision, which is more favourable to the compensator than was the tribunal's, following my own assessment of the evidence and the application of the relevant law.

(signed)

L T PARKER

Commissioner

Date: 22 April 2005