UK Social Security and Child Support Commissioners' Decisions

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[2008] UKSSCSC CH_3240_2007 (21 July 2008)

DECISION OF THE SOCIAL SECURITY COMMISSIONER

My decision is given under paragraph 8(4) and (5)(c) of Schedule 7 to the Child Support, Pensions and Social Security Act 2000:

I SET ASIDE the decision of the Fox Court appeal tribunal, held on 20 December 2006 under reference 160/06/01307, because it is erroneous in point of law.

I REMIT the case to a differently constituted appeal tribunal and DIRECT that tribunal to conduct a complete rehearing of the issues that are raised by the appeal and, subject to the tribunal's discretion under paragraph 6(9)(a) of Schedule 7 to the 2000 Act, any other issues that merit consideration.

REASONS

The issue and how it arises

This case concerns an overpayment of housing benefit in respect of the inclusive period from 22 September 2003 to 17 September 2006, amounting to £3832.42.

The overpayment arose because the local authority, in calculating of the claimant's housing benefit, failed to take account of the fact that she was no longer paying child care costs. This had been disclosed to the local authority by the claimant, but it was not acted on.

The claimant exercised her right of appeal against the local authority's decision, but the tribunal dismissed her appeal. I gave leave to appeal and have now received observations from the local authority and the claimant.

Ms Charlery has argued that, as she disclosed the relevant information to the local authority, she is not responsible for the overpayment. That is correct in the sense that she was not to blame for the local authority failing to take that information into account. However, the law distinguishes between blame and responsibility. A claimant may not be to blame for the overpayment, but may nonetheless be liable to repay the money under the legislation governing housing benefit. The tribunal decided that the claimant was liable to repay the money. The issue for me is whether the tribunal went wrong in law in making that decision.

The law and its application in this case

The recovery of overpayments is governed by section 75 of the Social Security Administration Act 1992:

'(1) Except where regulations otherwise provide, any amount of housing benefit determined in accordance with regulations to have been paid in excess of entitlement may be recovered either by the Secretary of State or by the authority which paid the benefit.

'(2) Regulations may require such an authority to recover such an amount in such circumstances as may be prescribed.'

The regulations made under that authority were originally contained in the Housing Benefit (General) Regulations 1987, which have now been consolidated in the Housing Benefit Regulations 2006.

'Overpayment' is defined by regulation 99 of the 2006 Regulations:

'"overpayment" means any amount which has been paid by way of housing benefit and to which there was no entitlement under these Regulations (whether on the initial decision as subsequently revised or superseded or further revised or superseded) and includes any amount paid on account under regulation 93 (payment on account of a rent allowance) which is in excess of the entitlement to housing benefit as subsequently decided.'

The circumstances in which an overpayment is recoverable are prescribed by regulation 100 of the 2006 Regulations:

'(1) Any overpayment, except one to which paragraph (2) applies, shall be recoverable.

'(2) Subject to paragraph (4) this paragraph applies to an overpayment which arose in consequence of an official error where the claimant or a person acting on his behalf or any other person to whom payment is made could not, at the time of receipt of the payment or of any notice relating to that payment, reasonably have been expected to realise that it was an overpayment.

'(3) In paragraph (2), "overpayment which arose in consequence of an official error" means an overpayment caused by a mistake made whether in the form of an act or omission by-

(a) the relevant authority;

(b) an officer or person acting for that authority;

(c) an officer of-

(i) the Department for Work and Pensions; or

(ii) Revenue and Customs

acting as such; or

(d) a person providing services to the Department for Work and Pensions or to the Commissioners for Her Majesty's Revenue and Customs,

where the claimant, a person acting on his behalf or any other person to whom the payment is made, did not cause or materially contribute to that mistake, act or omission.

'(4) Where in consequence of an official error, a person has been awarded a rent rebate to which he was not entitled or which exceeded the benefit to which he was entitled, upon the award being revised or superseded any overpayment of benefit, which remains credited to him by the relevant authority in respect of a period after the date on which the revision or supersession took place, shall be recoverable.'

The first question is: did the local authority make an official error under regulation 100(3)? If it did not, the overpayment was recoverable from the claimant. It is clear in this case that the local authority did make an official error and that is not in dispute.

That leads to the next question: could the claimant reasonably have been expected to realise that she was being overpaid benefit under regulation 100(2)? It is at this point that the law distinguishes between blame and responsibility. Even if the claimant was not in any way to blame for an overpayment, she will be liable to repay it if, at the time of receipt of the payment or of any notice relating to that payment, she could reasonably have been expected to realise that it was an overpayment.

The tribunal found that the claimant could reasonably have been expected to realise she was being overpaid, because the child care costs continued to appear in the notices of payment that were sent to her. If that were the only feature of this case, the tribunal would have come to the correct decision. However, there is another feature in that the claimant says she contacted the local authority about it and, despite her call, the local authority continued to pay.

In those circumstances, it may no longer have been reasonable for the claimant to realise that she should not be receiving the money she was? There must come a point at which a claimant is entitled to rely on the local authority's notification and accept that it knows best. The tribunal failed to consider this issue and that is why I must its decision aside.

I have directed a rehearing so that the tribunal may question the claimant about her contact with the local authority. The authority says that it has no record of any contact by the claimant and that the CDs holding its call records for the period have been corrupted. That will make it easier for the claimant to establish her case, as she will not have to counter any evidence put forward by the local authority. However, she still has to satisfy the tribunal that her account is reliable and credible.

If the tribunal accepts the claimant's account that she contacted the local authority about the overpayment, it will have to assess how she could reasonably have interpreted the local authority's failure to act given her experience of dealing with that authority.

Documentation required by a tribunal

The tribunal commented that relevant documentation was not before it. According to the claimant, the chairman told the local authority's presenting officer that this may have been the worst prepared case she had seen. I said on granting leave that I would deal in my decision with the duty of a local authority to provide the claimant and the tribunal with copies of all relevant documents.

The local authority is a party to the proceedings before the tribunal. However, it is disinterested in the outcome of the case in that its function is not simply to defend its decision. Its function is to assist the tribunal to ensure that the correct decision is reached on the evidence. In order to do that, the tribunal must have all relevant documentation before it. And it is the duty of the local authority to provide all relevant documentation in its possession.

The officer who prepares the submission to the tribunal has to make a judgment about what to include. The officer should provide all material relevant to the decision under appeal and, in particular, to the issues raised by the claimant in the appeal. Extraneous material is of no benefit to anyone and may be confusing. However, it may not be completely clear whether particular documents will or will not be relevant to the hearing. If in doubt, officers for a local authority should err on the side of caution and include anything that might be relevant to the hearing.

If a local authority withholds information that is relevant to an appeal, it may be in breach of a principle analogous to natural justice, which was recognised by Lord Bridge in the House of Lords in Al-Mehdawi v Secretary of State for the Home Department [1989] 3 All ER 843 at 848. See also R(CS) 1/99 at paragraph 8. And that alone is sufficient to justify a decision being set aside.

I make these comments for the guidance of local authorities. In this case, any omissions were remedied before the tribunal made its decision. However, it is preferable for the local authority to get its submission right first time.

Disposal

I allow the appeal, set aside the tribunal's decision and direct a rehearing.

The claimant has asked for an oral hearing, as she does not understand all the legal jargon. She will be entitled to an oral hearing before the appeal tribunal, where the chairman will assist her to understand the issues that arise and the evidence that is required. I also advise the claimant to consider obtaining representation. The CAB, a local authority's welfare rights organisation, a local law centre and similar bodies are experienced in advising claimants on social security matters. Their addresses can be found in a telephone book or at a library. A convenient CAB or law centre can be identified from their national websites: www.citizensadvice.org.uk; www.lawcentres.org.uk. These bodies may be able to assist without charge and may be willing to visit her at home. They will be able to advise on what evidence to obtain and what arguments to deploy on the appeal.

Signed on original
on 21 July 2008

Edward Jacobs
Commissioner