DECISION OF THE UPPER TRIBUNAL

(ADMINISTRATIVE APPEALS CHAMBER)

 

 

The DECISION of the Upper Tribunal is to allow the appeal by the appellant.

 

The decision of the Wigan First-tier Tribunal dated 16 March 2008 under file reference 078/08/02129 involves an error on a point of law.  The tribunal’s decision is set aside.

 

The Upper Tribunal is not in a position to re-make the decision under appeal.  The appeal against the decision of the Secretary of State dated 20 December 2007 is therefore sent back to a new appeal tribunal to be re-heard.  The new tribunal should have regard to the Directions at paragraph 38 below.

 

This decision is given under section 12(2)(b)(i) of the Tribunals, Courts and Enforcement Act 2007.

 

 

 

REASONS FOR DECISION

 

The decision in summary

 

1.         The appellant’s appeal to the Upper Tribunal is allowed.  The decision of the Wigan First-tier Tribunal dated 16 March 2008 under file reference 078/08/02129 involves an error on a point of law. The Upper Tribunal is not in a position to make its own decision on the underlying appeal, and so the case has to be sent back for rehearing by a new tribunal.  The fact that this appeal to the Upper Tribunal has succeeded should not be taken as any indication of the likely outcome of the rehearing before the First-tier Tribunal.

 

The request for an oral hearing of the appeal before the Upper Tribunal

 

2.         The appellant has requested an oral hearing of this appeal before the Upper Tribunal “to be assured that the relevant points are not missed”.  I have considered this request but refuse it, not least as I am allowing this appeal to the Upper Tribunal in any event.  I can understand the appellant’s desire for an oral hearing – but the place for that is in front of a new First-tier Tribunal.  That tribunal is best placed as a finder of fact.  It will also enable a hearing to be organised more quickly and at a venue that is more convenient for the appellant than Central London.

 

The background to this appeal

 

3.         The appellant is a gentleman aged 59 at the time in question.  He has spent part of his working life abroad.  He owned (and may perhaps still own) a property in Turkey.  His wife lived in Thailand but at the time in question he had been unable to get a settlement visa for her to join him in the United Kingdom.  In the summer of 2007, when he was living in England at his mother’s home, he fell ill and was diagnosed with cancer of the colon.  This diagnosis was followed by surgery.  On 29 October 2007 the appellant made a claim for income support and on 13 November 2007 he answered a series of questions over the telephone; the Jobcentre Plus staff member he spoke to completed an “IS Input Doc” (pages 5-11).

 

4.         In the course of that telephone claim the appellant disclosed the existence of the Turkish property.  According to the answers entered on the questionnaire, he described it as a “holiday home”, which was standing idle and was worth about £90,000.  It was stated that he did not intend to sell the property as it was a “bad time to sell”.  The appellant provided further answers in writing about his circumstances (pages 12-20), and in particular about the property in Turkey and its valuation (pages 19-20).

 

5.         A decision maker, acting on behalf of the Secretary of State, then decided on 20 December 2007 that the appellant was not entitled to income support (page 21).  The reason given was that he owned a property in Turkey, worth about £90,000 and free of any mortgage, which he was not selling.  The decision maker concluded that the capital represented by the property could not be disregarded and as it was over £16,000 there was no entitlement to benefit.           

 

6.         The appellant replied, arguing that this was not “another property” but his only property and that he was unable under Turkish law to borrow money against it (page 22).  He asked for his claim to be reconsidered.  A different decision maker looked at the claim again on 14 February 2008 but reached the same conclusion (page 23).

 

7.         The appellant then sent in a series of letters giving more information about his circumstances, along with further documentary evidence (pages 24-35).

 

The Wigan First-tier Tribunal’s decision

 

8.         The appeal hearing took place at Wigan on 16 March 2009.  The appellant attended and gave evidence.  In the course of that evidence, and referring to the answers about the Turkish property on the telephone claim form, the appellant pointed out that he had not signed the “IS Input Doc” form.  He added that he was ill at the time and had not been concentrating properly when giving the answers over the telephone (page 37).  The tribunal’s decision was to confirm the Secretary of State’s decision and so to dismiss the appeal (page 38). 

 

9.         The Tribunal Judge who had heard the appeal then issued a Statement of Reasons.  The judge referred to the appellant’s statements about the Turkish property on the claim form, which the appellant now disputed in part.  The tribunal’s main reason for dismissing the appeal was that it was a “quantum leap” for the appellant now to deny the veracity of those answers.  In a key passage, the tribunal ruled:

 

“In these circumstances, the Tribunal would have expected the Appellant to produce some medical evidence as regards his alleged illness.  Nothing was produced.  The Tribunal would have expected the Appellant to produce some evidence from the relevant estate agent clearly to confirm that the property was on the market and up for sale.  Nothing was produced.  There was a suggestion that the property had been up for sale previously and had been taken off the market.”

 

10.       Moreover, the Tribunal Judge found that the appellant had presented well at the tribunal, “was alert, articulate and fully able to communicate” with no lack of concentration.  Accordingly he ruled that the answers on the claim form were “clear and unequivocal” and on the basis of those answers the capital could not be disregarded.

 

 

The error of law involved in the tribunal’s decision

 

11.       Mr David Scholefield, who now acts on behalf of the Secretary of State, supports the appellant’s appeal to the Upper Tribunal (pages 53-55).   Mr Scholefield agrees with my suggestion when granting permission to appeal, namely that the appellant was denied a fair hearing by the First-tier Tribunal.  The appellant’s failure to produce corroborating medical evidence was a central part of the Tribunal Judge’s reasoning for dismissing the appeal. However, there is no evidence that the appellant had either been required or given an opportunity to present such evidence.  Indeed, I note that the appellant states that he in fact had his medical reports with him at the hearing but they were never asked for.  Certainly there is no suggestion in the Record of Proceedings that he was asked for them.

 

12.       In those circumstances I have no doubt but that the appellant was denied a fair hearing.   That amounts to a clear error of law and I have no hesitation in setting aside the decision of the First-tier Tribunal (Tribunals, Courts and Enforcement Act 2007, section 12(2)(a)).  For the reasons indicated above at paragraph 2, the appellant’s appeal against the original decision of the Secretary of State will have to be reheard by a fresh tribunal (2007 Act, section 12(2)(b)(i)).

 

13.       The tribunal’s approach in this case was regrettable.  The Secretary of State did not appear to dispute that the appellant had been diagnosed with cancer and had undergone surgery (see page 2 of original submission to the tribunal).  The appellant’s account of his illness had been repeated at various stages in the period leading up to the appeal (see claim form at page 10 and correspondence at pages 17, 22, 24 and 31).  That account was consistent and had not been challenged.

 

14.       Clearly a tribunal has an inquisitorial role and is not bound merely to accept what the parties state to be the case.  Indeed, the mere fact that the Department does not challenge a claimant’s statement does not preclude the Tribunal Judge from asking searching questions.  However, it is well established that a tribunal “need not consider any issue that is not raised by the appeal” (Social Security Act 1998, section 12(8)(a)) and, if it does so, the tribunal must exercise its discretion judicially.  Unfortunately this tribunal failed to have regard to that principle in referring to the appellant’s “alleged illness”.

 

15.       I am also troubled by the tribunal’s reliance on the appellant’s competent manner at the hearing as evidence to doubt the credibility of his account of his health as at the time that he made the claim for benefit.  The telephone claim details were taken on 13 November 2007.  The tribunal hearing was some 18 months later on 16 March 2009.  Leaving aside any possible breach of section 12(8)(b) of the 1998 Act (namely that the tribunal “shall not take into account any circumstances not obtaining at the time when the decision appealed against was made”), such an approach is clearly problematic.  This is for the very simple reason that the appellant’s state of health may have been very different as at those two dates.  Indeed, in one of his letters the appellant had said that he had been “unable to work from November 2007 until April 2008 due to requirement for two intestinal operations” (page 24).  At the very least that implied some improvement in his condition over the intervening period.

 

The issues for the new First-tier Tribunal to address

 

The relevant law

 

16.       The new tribunal should have sight of Mr Scholefield’s helpful submission and  I direct accordingly (see Direction at paragraph 38(6) below).  As Mr Scholefield explains, the fundamental question to be resolved is whether the exception in paragraph 26 of Schedule 10 to the Income Support (General) Regulations 1987 (SI 1987/1967, as amended) applied in the period from the date of the claim to the date of the decision on that claim.  Paragraph 26 refers to:

 

“26.    Any premises where the claimant is taking reasonable steps to dispose of those premises, for a period of 26 weeks from the date on which he first took such steps, or such longer period as is reasonable in the circumstances to enable him to dispose of those premises.”

 

17.       The potential application of paragraph 26 to the circumstances of the present case is a classic question of fact for the First-tier Tribunal to determine.  Indeed, there are a number of separate questions of fact for the tribunal to resolve.

 

Question 1: was the appellant taking any steps to dispose of the property?

 

18.       The first question is whether the appellant was taking any steps at all to dispose of the premises at the material time (between 29 October 2007 and 20 December 2007).  I stress that the date of the decision was 20 December 2007, the date of the initial refusal, and not – as the submission suggested and the tribunal assumed – 14 February 2008, the date of the “reconsideration” decision.  As the Tribunal of Social Security Commissioners explained in reported decision R(IB) 2/04, “So far as decisions under section 9 (revision) are concerned, section 12(1) provides a right of appeal, not against the decision under section 9 as such, but only against the original decision as either revised or not revised” (at paragraph 38).

 

19.       The new tribunal will need to form its own judgment and make appropriate findings on all the evidence before it as to whether the appellant was taking any steps to dispose of the property.  The evidence that is currently available about the Turkish property and the appellant’s intentions and acts is ambiguous.  On 13 November 2007 the appellant reportedly told the interviewing officer on the telephone that he did not intend to sell and indeed it was a bad time to sell (page 9).  He now says his health affected his answers and he was not given an opportunity to read over and sign that application form.  I note that the copy of the IS Input Doc in the papers before the tribunal is incomplete.  For some reason only pages 1-5, 7 and 12 of the form’s 14 pages have been included (see further Direction 38(4) below).

 

20.       On 31 October 2007 the appellant stated briefly in a letter that the property had lain idle for two years and he had not been able to afford to visit Turkey to attend to it (page 12).

 

21.       On 4 December 2007 the appellant provided two pages of details about the property (pages 19-20). He explained that it had been bought for £65,000 in early 2002 and had been valued recently at between £90,000 and £120,000.  He added that he had tried unsuccessfully to sell it for £120,000 but had taken it off the market “last year” (presumably in 2006).

 

22.       As we have seen, the initial decision to refuse benefit was taken shortly afterwards on 20 December 2007 and that decision was confirmed on reconsideration on 14 February 2008.  The First-tier Tribunal only had a copy of the typed reconsideration decision (page 23).  However, the Tribunals Service backing file includes a copy of a handwritten file note, signed by the same officer and dated the same date.  It appears that the Department’s Appeals Officer only sent the copy of that handwritten note to the Tribunals Service with a memorandum dated 24 November 2008, accompanying what was said to be the appellant’s late appeal.  It was not included in the bundle of papers for the tribunal hearing and so was presumably not seen by the appellant.  It is unclear whether the Tribunal Judge saw the note; certainly he made no reference to it and it is likely he did not see it, as it was “buried” in the backing file.

 

23.       The new tribunal will need to see a copy of that note and I direct accordingly (Direction 38(4) below).  That note may be significant as it reports the officer’s telephone discussion with the appellant on 14 February 2008 as follows:

 

            “To Customer

I gave an explanation as to why his claim to I.S. had not been successful.  I asked if there had been a change i.e. if it was now up for sale & he reported it wasn’t.  He may put it up later in the year.  I advised that the decision would remain unchanged.  If he had a change in circs he should re-claim. 

GL24 issued.”

 

(A GL24 is the leaflet and form explaining how to lodge an appeal.)

 

24.       Up to this point the appellant’s main argument was that he had no effective way of realising the value of his asset in Turkey.  By the time of his letter nearly a year later, dated 3 November 2008 (page 24), it seems that he had been made aware that efforts he had made to sell the property would be regarded as relevant.  That is consistent with the file note referred to above but not included in the tribunal bundle.  The appellant reiterated on 13 November 2008 that he had been previously unaware of the significance of this factor (page 27).

 

25.       The appellant now argued that he had been making efforts to sell the property for some time.  He reported that the property was the subject of ancillary proceedings subsequent to his divorce (from an earlier wife, not his current Thai wife).  He included a copy of a letter dated 1 November 2007 (and so broadly coinciding with the date of his claim for benefit) from Turkish estate agents who had been instructed by his ex-wife.  They estimated the value of the property as being “in the region of £130,000”. This reported that the property was currently displaying a “For Sale” notice and was advertised as such at £150,000.  A webpage (undated) confirming that asking price is in the papers.

 

26.       There is, therefore, a clear conflict of evidence which the First-tier Tribunal needs to resolve.  Were the appellant’s answers correctly reported on the income claim support form on 13 November 2007?  Even if they were correctly reported and entered on the IS Input Doc by the Jobcentre Plus officer, were they accurate?  Or was the position actually as stated a fortnight earlier by the Turkish estate agents, instructed by the ex-wife, in their letter dated 1 November 2007?  The Department’s case at the tribunal was apparently that the evidence from the valuing agents indicated no more than that the appellant’s own estate agent had not updated their records (page 4).

 

27.       In a letter dated 15 February 2009, the appellant stated that he had in fact been trying to sell the Turkish property for a realistic price “over the last few years, in fact since 2005 following my marriage to a Thai national” (page 31).  He conceded that the property had been taken off the market for an (unspecified) “short period of time”, owing to difficulties with local estate agents.  The property was “temporarily… off the market” but he had then been unable to go abroad to supervise the sale of the property owing to the onset of his illness.

 

28.       Although this will be a matter for the new tribunal to determine, the fact that the appellant had been taking some steps to sell the Turkish property seems to be confirmed by the decision of Immigration Judge Lowe in AIT appeal no. IM/26717/2005.  On 24 January 2006 she held a hearing of the appeal against the refusal of entry clearance for the appellant’s Thai wife.  She dismissed that appeal, but appears to have accepted that the appellant was even then making efforts to sell the property in Turkey.  However, the appellant has only provided the first and last pages of a 10-page judgment, perhaps because he thought they were the only relevant pages.  However, the new First-tier Tribunal is unlikely to attach much weight to these comments by Immigration Judge Lowe unless it has sight of the full AIT judgment.

 

Question 2: was the appellant “taking reasonable steps” to dispose of the property?

 

29.       The second question is, assuming that some steps were being taken, whether they were “reasonable steps”.  Again, that is ultimately a question of fact.  As Mr Commissioner Howell QC held in reported decision R(IS) 4/97 (involving a property that the claimant in that case owned in Jamaica), that is an objective test. So, for example, if tribunals “are satisfied the earlier attempt was a hopeless one because the price was quite unrealistic or the media chosen unsuitable, they may properly disregard it” (R(IS) 4/97, at paragraph 22).  However, the expression “reasonable steps to dispose of those premises” must not be read too narrowly.  Thus bringing ancillary relief proceedings in a divorce action may amount to such steps (R(IS) 5/05, at paragraph 15). The importance of considering the question of reasonableness in the round was also emphasised again in CIS/1915/2007 (at paragraphs 17 and 18).

 

Question 3: if so, from which date does the initial disregard of 26 weeks run?

 

30.       The third question that must be addressed is the date from which the disregard period runs.  Clearly, under the legislation this is the date “on which he first took such steps” (emphasis added) – another question of fact.  However, this is not necessarily the date on which the property was first put on the market (see CIS/6908/1995 at paragraph 7 and R(IS) 5/05 at paragraph 15).  It may be in some cases, for example, the date on which a joint tenant is approached with a view to securing agreement for a sale (JH v SSWP [2009] UKUT 1 (AAC) at paragraph 44).

 

31.       The potential problem for the appellant here is that he may well be found by the new tribunal to have started marketing the property in 2005, some two years before his claim for income support.  Case law shows that the start date for the disregard may start before the claim for benefit – see the decision of Mr Commissioner Rice in CIS/562/1992.  That being so, it might be that any disregard under paragraph 26, whether for an initial 26 weeks or for a further reasonable period, may have expired by the time of the appellant’s claim for benefit.

 

32.       It will therefore be important to establish if the property was taken off the market, and if so over which period.  As the commentary in Volume II of the Social Security Legislation 2009/10 indicates (at p.695), the decision in CIS/562/1992 is undoubtedly correct on its facts. However, the commentary also suggests that that principle may not apply if a property is up for sale, then genuinely taken off the market but put back up for sale later.  In such circumstances it is arguable that time under paragraph 26 runs from the second occasion of taking steps to dispose of the property.  Again, this is a question of fact to be judged by the First-tier Tribunal in a broad commonsense way.  The later decision of Mr Commissioner Jacobs in the joined appeals of CIS/2668/1998 and CJSA/2379/1998 supports that approach (especially at paragraph 9):

 

            “9.       In CIS/562/1992, the Commissioner held that the correct starting point was not the date of claim, but the date when the claimant first took steps to dispose of the property. I respectfully agree with that decision. However, it must not be misunderstood. It prevents a claimant obtaining a succession of disregards for 6 months each by the simple expedient of taking the property off the market and putting it on again the next day or a few days later. But it does not mean that time has been running against a claimant who made another distinct attempt to dispose of the property some time earlier. I do not attempt to define the circumstances in which time has continued to run or has stopped running for the purposes of this disregard. The answer is to be found by investigating the facts of case and by bringing common sense to bear in an assessment of the probabilities.”

 

33.       To that extent I take the view that the guidance given to decision makers in paragraph 29585 in Chapter 29 of Vol 5 of the Decision Makers Guide does not properly reflect the law.  That official guidance states that “The first date does not change.  So if a person has tried several times to dispose of the premises the date is the first date the person did something reasonable to dispose of the premises the first time”.  That analysis is undoubtedly consistent with CIS/562/1992.  However, it does not properly reflect the nuance noted by Mr Commissioner Jacobs in CIS/2668/1998 at paragraph 9 of his decision.

 

Question 4: should the disregard period be extended for “such longer period as is reasonable in the circumstances to enable him to dispose of those premises”?

 

34.       The fourth question, assuming that such reasonable steps were being taken, is how long the disregard should last for.  Paragraph 26 makes it plain that the disregard must last for a minimum “period of 26 weeks from the date on which he first took such steps”.   However, the 26-week period is just that, a minimum.  The disregard may alternatively last for “such longer period as is reasonable in the circumstances to enable him to dispose of those premises”.  Again, the issue of reasonableness is pre-eminently a question of fact.  Each case will depend on its own facts, and the efforts made to sell the property are merely one of several factors that may be relevant (see CIS/6908/1995 at paragraph 11).  A person’s state of health may well be a relevant consideration (see CIS/4757/2003 at paragraph 6, decided in the context of the similar disregard under paragraph 3 of Schedule 10). 

 

35.       Finally, if the new tribunal concludes that the Turkish property is not disregarded, it should be valued in accordance with regulation 50 of the Income Support (General) Regulations 1987.

 

36.       I merely add by way of a final note that it would have been helpful, for ease of reference, if the tribunal’s Statement of Reasons had been issued with paragraph numbers, as required by the Senior President’s Practice Statement on the Form of Decisions, issued on 31 October 2008 and available on the Tribunals Service website.

 

Conclusion and outcome of this appeal to the Upper Tribunal

 

37.       I allow the appellant’s appeal.  A new tribunal must rehear the appeal against the secretary of State’s refusal of the claim for income support.  My decision is therefore as set out above.   The following Directions apply to the rehearing.

 

Directions

 

38.       The following Directions apply:

 

(1)        The rehearing will be at an oral hearing.

 

(2)        The new tribunal should not involve any judge or member who has previously been involved in hearing this appeal.

 

(3)        The appellant is reminded that the tribunal can only deal with the appeal as at the date of the original decision under appeal (namely 20 December 2007).

 

(4)        The Secretary of State is to send a copy of both:

(i)         the complete IS Input Doc form for the appellant dated 13 November 2007; and

(ii)        the handwritten clerical file note dated 14 February 2008 reporting the telephone conversation with the appellant on that date

to the Tribunals Service Regional Office in Liverpool within one month of the issue of this decision.

 

(5)        If the appellant has any further written evidence to put before the tribunal, this should also be sent to the Tribunals Service Regional Office in Liverpool within one month of the issue of this decision.   In this context the appellant should note that a tribunal is unlikely to place much reliance on an extract from a document when it has not had sight of the full document (e.g. the decision of Immigration Judge Lowe in AIT appeal no. IM/26717/2005, of which only two pages appear in these appeal papers).

 

(6)        A copy of the submission by Mr David Scholefield, on behalf of the Secretary of State, supporting the appellant’s appeal to the Upper Tribunal should be made available to the new tribunal.

 

(7)        Copies of unreported Commissioners’ decisions CIS/562/1992 and the joined appeals of CIS/2668/1998 and CJSA/2379/1998 should be added to the tribunal papers.

 

(8)        The new tribunal must consider all the evidence afresh and is not bound in any way by the decision of the previous tribunal. 

 

These Directions are all subject to any later Directions by a Tribunal Judge in the Social Entitlement Chamber of the First-tier Tribunal.

 

 

 

 

 

 

 

Signed on the original                                              Nicholas Wikeley

on 30 November 2009                                              Judge of the Upper Tribunal