Upper Tribunal (Administrative Appeals Chamber)

 

DECISION OF THE UPPER TRIBUNAL

ADMINISTRATIVE APPEALS CHAMBER

 

The claimant's appeal to the Upper Tribunal is disallowed. The decision of the Leeds First-tier Tribunal dated 17 November 2008 involved errors on points of law, but the errors were not material to the outcome of the case, and the decision is not set aside (Tribunals, Courts and Enforcement Act 2007, section 12(2)(a)).

 

 

REASONS FOR DECISION

 

1. This is a fearsomely complicated case which involves some of the most difficult and technical parts of the legislation governing entitlement to social security benefits and the system of decision-making, including in particular the making of decisions to take away entitlements already awarded for a past period and finding the resulting overpayments of benefit to be legally recoverable from the recipient. The present decision is to do with so much of the First-tier Tribunal's decision as was concerned with the decision on entitlement to increases of incapacity benefit for the claimant's wife and children from 14 June 2002 onwards. The decision in CIB/156/2009 deals with so much of the tribunal's decision as was concerned with the consequent overpayment recoverability decision.

 

2. An oral hearing of the two appeals was held at Doncaster County Court on 15 December 2010. The claimant was unable to attend because of illness and was not represented. The Secretary of State for Work and Pensions was represented by Mr Stephen Cooper, solicitor, instructed by the Department for Work and Pensions Legal Group.

 

3. The claimant had asked in a letter dated 19 November 2010 for that hearing to be postponed to give him more time to find a skilled representative. I refused that request in a ruling dated 1 December 2010, saying that there was no realistic prospect of the claimant being in any better position as to representation in the future. There was a further request for postponement in an email dated 13 December 2010 from Mr George Mudie, the claimant's Member of Parliament, but that has not altered my previous view.

 

4. There has been a very unhappy history for the claimant of organisations who had been able to provide assistance at certain stages no longer being able to do so and of organisations with whom the Administrative Appeals Chamber (AAC) office was able to put the claimant into touch taking up many, many months without in the end providing any help. I fear that I have contributed substantially to the delays involved by raising issues of law that are not, as I now see the case, relevant to the particular circumstances and by failing to clear enough time from the pressure of other cases to confront the mass of paper involved. However, in the interests of all concerned, these cases cannot be allowed to drag on any longer. Although the claimant did not feel able in his state of health to attend the hearing on his own and was not represented there, I can assure him that I have given the fullest consideration to all the points that can legitimately be made in his favour. That is one of the reasons why this decision is so long.

 

The factual background

5. As found by the tribunal of 17 November 2008, the claimant became incapable of work in January 1987. He was awarded sickness benefit, followed by invalidity benefit. That at the time would have been under the Social Security Act 1975. In 1994, while what he was receiving was still invalidity benefit, he claimed an increase of benefit for his wife and his four children. Those increases were awarded with effect from 6 May 1994 by a decision dated 3 May 1994 (although the increases for the two youngest children may only have been included from a later date in 1994). Since the power to award the increases must have arisen on a review of whatever was the current operative decision as to entitlement to a particular rate of invalidity benefit, from that date the entitlement to benefit including the increases must be regarded as authorised under the Social Security Contributions and Benefits Act 1992, which had consolidated much social security legislation, including the Social Security Act 1975, with effect from 1 July 1992. Payments of those increases continued into August 2004, although an investigation had been started in June 2004 following an allegation to the Department that the claimant was receiving benefit for dependants who were not living with him.

 

6. A first step in the investigation was an interview with the claimant's wife. On 16 June 2004 she signed a statement saying that she had left the claimant permanently in June 2002 with the two youngest children and that she had now given up the child benefit in respect of the two eldest children (J and S) who remained at that time with the claimant. She also said that she had left him before for periods taking all the children, but there is no need to explore in this decision any dates before 14 June 2002. In answer to a further enquiry, she said that in June 2002 she had the child benefit order books for all four children and that J and S were excluded from her order book on 3 March 2003 and 10 November 2003 respectively. She said that she had not received any payments from the claimant for herself or the children. That was a point strongly challenged by the claimant.

 

7. Telephone enquiries to the Child Benefit Centre (pages 89 to 92) appear to have produced the information that J was excluded from the claimant's wife's child benefit entitlement from 3 March 2003 until being included from 16 August 2004 and excluded again from 13 September 2004. J was said to have been included in the claimant's child benefit entitlement only from 1 September 2003, excluded from 22 September 2003, included again from 10 November 2003 and excluded from 16 August 2004. However, there was mention apparently in a later telephone call that a fraud file showed that J had left the claimant's wife's household on 31 December 2002 and that there was an overpayment of child benefit from 3 March 2003. The information about S appears to have been essentially the same so far as the claimant's own child benefit entitlement went, but that his wife surrendered her entitlement from 10 November 2003. Computer records (pages 93 and 94) appear to confirm the information about J and the claimant's wife's child benefit entitlement in respect of J. The records for the claimant appeared to show both J and S as included in his child benefit entitlement from 1 September 2003, excluded from 22 September 2003 and included again from 10 November 2003.

 

8. Attempts to interview the claimant under caution were abandoned because of concerns that he had a significant mental condition. The following decision was eventually given on 11 July 2006:

 

"I have superseded the decision dated 3/5/1994 awarding an increase of Incapacity Benefit in respect of [his wife] to [the claimant]. There has been a relevant change of circumstances since the decision was given. This was that [his wife] left [the claimant's] household and he ceased to maintain her on 14/6/02.

As a result there is no entitlement to an increase of Incapacity Benefit for [his wife] from and including 14/6/02. This is because [the claimant] is neither residing with her nor paying at £42.45 (the rate in 2002) a week toward her maintenance.

There is no entitlement to an increase of Incapacity Benefit for [J, S, Ja and A] from and including 14/6/02. This is because [the claimant] is not entitled to child benefit for [J, S, Ja and A] and cannot be treated as so entitled."

 

There was reference to sections 80 and 83(2) of the Social Security Contributions and Benefits Act 1992 and to regulations 4A(1) and 11 of the Social Security (Dependency) Regulations 1977.

 

9. It was that decision that was before the tribunal in the appeal which is the subject of the present decision. A further decision was given on 27 October 2006 to the effect that as a result an overpayment of £9,885.55 had been made for the period from 14 June 2002 to 19 August 2004 which was recoverable from the claimant under section 71 of the Social Security Administration Act 1992. The appeal against that decision is the subject of CIB/156/2009.

 

The relevant legislation on entitlement to dependency increases and some general analysis

10. In May 1994, section 83(2) of the Social Security Contributions and Benefits Act 1992 provided for an increase of an invalidity pension for any period during which the claimant was residing with his wife or for which he was contributing to her maintenance at a weekly rate not less than the amount of the increase. I need not consider the conditions about a wife's earnings.

 

11. By 2002, following the replacement of invalidity benefit by incapacity benefit in 1995 (which will be discussed in much greater detail below), that benefit had been taken out of the operation of section 83 and a new section 86A merely provided for an increase for adult dependants "in such circumstances as may be prescribed".

 

12. The prescription was in the Social Security (Incapacity Benefit - Increases for Dependants) Regulations 1994. The basic rule for adults was in regulation 9. Paragraph (1)(a) and (b) was as follows:

 

"(1) Subject to regulation 14, a beneficiary shall be entitled to an increase of incapacity benefit under section 86A(1) if--

 (a) he is residing with a spouse of his and either--

 (i) the spouse is aged at least 60; or

(ii) the beneficiary is entitled to an increase of incapacity benefit under section 80 in respect of a child; or

 (b) he has a spouse who is aged at least 60 and not residing with him but to whose maintenance he contributes at a weekly rate equal to or greater than the rate of the increase; or

 (c) there is an adult who--

 (i) is resident with him; and

(ii) cares for a child for whom the beneficiary is entitled to an increase under section 80; or

 (d) subject to paragraph (3) there is an adult who--

 (i) is not resident with him; and

(ii) cares for a child for whom the beneficiary is entitled to an increase under section 80,"

 

Regulation 9(3) added the condition for the purposes of regulation 9(2)(d) that either the adult was employed by the beneficiary or that the latter was contributing to their maintenance at a weekly rate not less than the standard weekly rate of the increase. Regulation 14 (imprisonment or absence abroad) is not relevant in the present case.

 

13. Regulation 24 of the Social Security (Incapacity Benefit) (Transitional) Regulations 1994 is also relevant, because from 13 April 1995 the claimant's award of invalidity benefit took effect as a "transitional award of long-term incapacity benefit" under regulation 17. Regulation 24, omitting irrelevant or subsidiary provisions, was as follows by 2002:

 

"(1) ... [I]n a transitional case where at any time during a period of 56 days immediately before the appointed day [13 April 1995]--

 (a) [concessionary payments]; or

 (b) an increase in the rate of invalidity benefit was payable for a spouse who was an adult dependant under Part IV of the [Social Security Contributions and Benefits Act 1992],

an amount equal to that increase shall be payable.

 (2) [amount under paragraph (1) to be increased annually].

 (3) Except as provided for in regulation 25, an increase under paragraph (1) shall continue to be payable where--

 (a) the spouse is residing with the beneficiary; or

 (b) the beneficiary is contributing to the maintenance of his spouse at the weekly rate equal to or greater than the rate of the increase.

 (4) Subject to regulations 25 and 26 and paragraph (5), the provisions in Part I (general) and Part III (adults), save for regulation 9(1)(a) and (b) of that Part, of the Increases for Dependants Regulations shall apply to the increase as if it were an increase under section 86A of the 1992 Act.

 (5) [persons over pensionable age].

 (6) Where a person becomes entitled to an increase under paragraph (1), he shall not be entitled to an adult dependency increase to which he would, but for this provision, be entitled under the Increases for Dependants Regulations.

 (7) Except in a case where paragraph (7A) applies, a person shall cease to be entitled to an increase under paragraph (1) when either--

 (a) no invalidity benefit or long-term incapacity benefit has been paid for at least 57 continuous days;

 (b) no increase of invalidity benefit or long-term incapacity benefit is paid or payable for at least 57 continuous days in a period of incapacity for work.

 (7A) - (8) [not relevant]."

 

14. To summarise at this point, the primary effect of regulation 24(6) and (3) of the Transitional Regulations is that someone who, as must have been the claimant's case here, became entitled after 13 April 1995 to a payment under regulation 24(1) can only continue to receive the payment if he and his wife cease to reside together if he contributes to her maintenance at the necessary rate. He cannot on the face of it rely on the alternative condition in regulation 9(1)(d) of the Increases for Dependants Regulations. But even if regulation 24(4) of the Transitional Regulations allows that condition to be invoked, it does not add anything of substance, because of the additional condition in regulation 9(3)(b) of the Increases for Dependants Regulations about contributing to the maintenance of the spouse. Once the increase has not been payable for a continuous period of 57 days, entitlement to the increase is lost completely (regulation 24(7)). I note for completeness that, even if the claimant had been able to rely on regulation 9(1)(a) and (b) of the Increases for Dependants Regulations, that would not have helped him because of the limitation to a spouse under the age of 60 (his wife having been born on 2 July 1959).

 

15. In 1994 and 2002, increases of benefit for children were controlled by section 80(1) of the Social Security Contributions and Benefits Act 1992, under the condition that the beneficiary was entitled to child benefit in respect of each child in question. Section 81(1) added these further conditions, in cases where there would otherwise be entitlement to the increase:

 

"(2) Those conditions are--

 (a) that the beneficiary would be treated for the purposes of Part IX of this Act [child benefit] as having the child living with him; or

 (b) that the requisite contributions are being made to the cost of providing for the child.

 (3) The condition specified in subsection (2)(b) above is to be treated as satisfied if, but only if--

 (a) such contributions are being made at a weekly rate not less than the amount referred to in subsection (1) above [the amount of the increase]--

 (i) by the beneficiary; or

(ii) where the beneficiary is one of two spouses residing together, by them together; and

 (b) except in prescribed cases, the contributions are over and above those required for the purpose of satisfying section 143(1)(b) below."

 

Regulation 5 of the Social Security (Dependency) Regulations 1977 allows the condition in subsection (2)(b) to be satisfied by an undertaking in writing to make the requisite contributions if the increase is awarded.

 

16. Regulation 24 of the Transitional Regulations makes no provision for increases for child dependants on the transition to incapacity benefit, only for adult dependant increases, so it appears that the general provisions of sections 80 and 81 must apply. Then as from 13 April 1995 regulation 6 of the Increases for Dependants Regulations applying to incapacity benefit in general allows a parent (ie the claimant here prior to 14 June 2002) who is residing with the parent who is entitled to child benefit (ie the claimant's wife here prior to 14 June 2002) also to be treated as entitled to child benefit, but only where they are residing together. There is nothing in regulation 6 (or in regulation 4A of the Dependency Regulations) to extend that deeming to cases in which the parents are not residing together and the one not entitled to child benefit is contributing to the maintenance of the children or even to cases where children are living with the parent not entitled to child benefit.

 

17. Therefore, once the claimant's wife left him on 14 June 2002 he no longer satisfied the conditions of entitlement for increases in respect of any of the four children, because no change was made in the decisions entitling her to the child benefit. The claimant could not be treated as entitled to child benefit, even if his wife was paying over some of the child benefit received to him. Nor does it appear to make any difference in law to the result that, according to the evidence before the tribunal, J and S remained with the claimant when his wife left with the youngest two children, so that he necessarily had to bear the immediate costs of providing for them. That did not fall within the conditions under which the claimant could be treated as entitled to child benefit and there was no alternative condition under which he could qualify for the child increases. Section 81 of the Contributions and Benefits Act cannot help him, because that did not supply an alternative route to qualification, but imposed extra conditions on a person who would otherwise have qualified under section 80. The claimant's "remedy" was to claim child benefit himself as soon as possible and to become entitled in respect of J and S, but on the current evidence (discussed further below) that did not happen until 1 September 2003. All of that formed the basis on which the Secretary of State made the decision on 11 July 2006, with the justification much more briefly set out in the written submission to the First-tier Tribunal.

 

18. There was therefore a significant change of circumstances within the period covered by the decision of 11 July 2006 when from 1 September 2003, if not from earlier, the claimant became entitled to child benefit in respect of J and S. I mention the possibility of an earlier date only because it seems very odd if the claimant's wife's entitlement to child benefit in respect of J ended on 3 March 2003 and the claimant did not become entitled until 1 September 2003. The evidence about child benefit was in general rather confusing and inconsistent. However, for the moment I can only proceed on the basis of adopting the 1 September 2003 date. The was no firm support in the evidence before the First-tier Tribunal for any earlier date of entitlement, even though it went wrong in purporting to find that the claimant was not entitled to child benefit for any part of the period in question (see paragraphs 26 and 32 below).

 

19. That change would on the legislative provisions already described have led to the claimant satisfying the conditions of entitlement for increases of benefit for J and S. However, with effect from 6 April 2003, sections 80 and 81 of the Social Security Contributions and Benefits Act 1992 were repealed by the Tax Credits Act 2002. That was part of the general policy of concentrating support for children in child benefit and child tax credit rather than in the form of increases in the amounts of other benefits. So, by 1 September 2003 there was nothing for the claimant to be entitled to unless he came within the scope of a special saving provision.

 

20. That provision was in article 3 of the Tax Credits Act 2002 (Commencement No 3 and Transitional Provisions and Savings) Order 2003 ("the 2003 Order"):

 

"3.--(1) Notwithstanding the coming into force of the specified provisions, the Contributions and Benefits Act and the Administration Act shall, in cases to which paragraph (2) applies, subject to paragraph (3), continue to have effect from the commencement date as if those provisions had not come into force.

 (2) This paragraph applies where a person--

 (a) is entitled to a relevant increase on or after the commencement date; or

 (b) claims a relevant increase on or after the commencement date and it is subsequently determined that he is entitled to a relevant increase in respect of a period which includes the day before the commencement date.

 (3) The provisions saved by paragraph (1) shall continue to have effect until--

 (a) subject to sub-paragraph (c), where a relevant increase ceases to be payable to a person to whom paragraph (2) applies for a period greater than 58 days beginning with the day on which it was last payable, on the day 59 days after the day on which it was last payable; or

 (b) in any other case, subject to sub-paragraph (c), on the date on which entitlement to a relevant increase ceases;

 (c) where regulation 6(19) or (23) of the Social Security (Claims and Payments) Regulations 1987 applies to a further claim for a relevant increase, on the date on which entitlement to that relevant increase ceases.

 (4) In this article--

 `the commencement date' means 6th April 2003;

 `a relevant increase' means an increase under section 80 or 90 of the Contributions and Benefits Act;

 `the specified provisions' means the provisions of the 2002 Act which are brought into force by article 2."

 

21. I deal with the relevant legislation on powers of supersession and effective dates in a separate section of this decision below.

 

The appeal to the First-tier Tribunal

22. The Secretary of State's written submission to the tribunal referred to the legislation set out above, except for regulation 24 of the Transitional Regulations and article 3 of the 2003 Order. It was submitted that from 14 June 2002 the claimant was not entitled to an increase for his wife on the ordinary incapacity benefit provisions, not noticing the problem that she was under the age of 60. It was submitted simply that from 14 June 2002 he was not entitled to increases for any children, because he was not entitled to child benefit in respect of them, and that by the time of the change from 1 September 2003 it was too late because increases for children had been abolished.

 

23. A written submission was eventually put in on the claimant's behalf in November 2008 by an adviser (I think Geoff West) at Harehills and Chapeltown Law Centre. This indicated first that, because of the physical and psychological effects of a road traffic accident in the 1980s (about which extensive medical records had been produced), the claimant had impaired recall of dates, times and figures, although not of particular events. On entitlement, it was submitted that the claimant's evidence was that J and S were living with him from June 2002 to August 2004 and that the evidence of child benefit entitlement was inconsistent. He had also produced evidence of financial support in that period for his wife and the other two children:

 

"10. [The claimant] gives evidence that he transferred £11,678 to his wife by way of paying off her debts and transferring the car to her. He gives receipts to the value of over £800 (copy indistinct in places) and shows a weekly payment of £90 to his wife from the 19/11/04. These payments support his position that he was indeed contributing to the maintenance to the requisite amount on the balance of probabilities."

 

It was then submitted that throughout the period in question the claimant was entitled to an increase for his wife under regulation 9(1)(d) of the Increases for Dependants Regulations and to an increase for all the children as he was entitled to child benefit in respect of them (for J and S because they were living with him and for Ja and A because he contributed to their maintenance at the requisite rate).

 

24. Further extensive evidence included copies of bank account and credit card statements from many accounts.

 

25. The claimant attended the hearing on 17 November 2008 without a representative. The tribunal, constituted by a single tribunal judge, disallowed the appeal and confirmed the decision of 11 July 2006. In the detailed statement of reasons (covering both appeals before the tribunal) it was noted that between 2002 and 2004 the claimant had a minimum of 24 bank accounts and over the years had also opened several building society accounts in the hope of receiving shares or cash payments on demutualisation. He also transferred balances between credit card accounts to take advantage of 0% offers. The tribunal concluded that he had a degree of financial acumen that allowed him to build up substantial savings and the ownership of two properties. The findings of fact continued:

 

"After the appellant and his wife separated he did make capital payments to her. For example he transferred the vehicle registration documents for a Ford Mondeo motor car into [his wife's] name and paid for repairs to the car. There is no evidence of the date of the transfer, the value of the vehicle at that time or the cost of the repairs. However, despite these payments there is no evidence that the appellant made regular payments to [his wife] which could be regarded as maintenance.

 

Between 2002 and 2004 the appellant purchased items of clothing and toys for the children. These were items of capital expenditure and were not in any way regular payments of maintenance or child support for the children. At no time since the parties separated has the appellant made regular payments in respect of the children nor been entitled to child benefit in respect of them.

 

...

Despite the appellant claiming that he had made significant payments to [his wife] whilst they have been separated there is no documentary evidence to support that assertion and even if there had been payments it is not clear to what extent those payments represented monies which already belonged to her [because amounts in the claimant's account would reflect assets owned jointly in equity between husband and wife]. Whatever the position those payments were capital payments and cannot be treated as maintenance payments."

 

26. Under the heading of "reasons for decision" it was said that the essence of maintenance, the making of a regular payment, was not present. In the absence of documentary evidence that the claimant had made credit card payments for his wife or transferred her balances to his cards or had made any other payments to her, it was not accepted that the claimant had maintained his wife and children in the period in question. It was said not to be in dispute that he had not been entitled to child benefit in that period and could not be treated as so entitled.

 

The appeal to the Upper Tribunal

27. I gave the claimant permission to appeal on 16 February 2009, not on any of the grounds that he had put forward, but raising two issues. One was the failure to address the effect of article 3 of the 2003 Order in the light of the evidence that a decision had been made that the claimant was entitled to child benefit in respect of J and S from 1 September 2003 at least. The second was the question whether, since the decision of 3 May 1994 would have been given by an adjudication officer and related to invalidity benefit, it was legally capable of being superseded on 11 July 2006 under the power in and under section 10 of the Social Security Act 1998, which referred to supersession of decisions of the Secretary of State under section 8 or 10 of the 1998 Act. I also raised the question whether, if there were no power on 11 July 2006 to supersede the decision of 3 May 1994, amendments to the legislation from 16 October 2006 and 24 September 2007 would allow the Secretary of State now to carry out a supersession affecting the period from 14 June 2002 to August 2004.

 

28. A written submission was made on behalf of the Secretary of State, drafted by Jason Coppel of counsel and dated 20 May 2009. It was very shortly argued on the first issue identified in the previous paragraph that by 1 September 2003 the claimant could not take advantage of article 3 of the 2003 Order because he was not entitled to an increase for J and S on 5 April 2003. On the second issue, it was submitted that the decision of 3 May 1994 was legally capable of being superseded on 11 July 2006, but, if that was wrong, the Secretary of State could now carry out a supersession with the same result without contravening any principles against giving legislation a retrospective effect.

 

29. The claimant's then representative, Scott Kelly of Leeds City Council's Welfare Rights Unit, replied on 31 July 2009. He said nothing on the first issue, but submitted on the second issue that there was no power on 11 July 2006 to supersede the decision of 3 May 1994 because invalidity benefit was not within the meaning of "relevant benefit" under section 8(3) of the 1998 Act. However, he considered that it was not possible to argue against the existence of a power to supersede after the amendment of the relevant legislation in October 2006 and September 2007 on the basis of any presumptions against retrospective effect of legislation.

 

30. I shall discuss the details of those submissions, and those made by Mr Cooper for the Secretary of State on 15 December 2010, only so far as necessary in explaining my conclusions on the two issues below.

 

31. I directed that there was to be an oral hearing. There then followed the long and very frustrating period of unsuccessful attempts to find skilled representation for the claimant after the withdrawal of Leeds City Council's Welfare Rights Unit due to their not being funded for representation at oral hearings at Upper Tribunal level. That culminated in the hearing on 15 December 2010 at which the claimant was not present or represented.

 

The tribunal's findings of fact

32. I am not entirely sure how far the claimant is challenging the tribunal's findings of fact apart from those about his entitlement to child benefit, which were clearly mistaken at least in relation to the period from 1 September 2003 to 22 September 2003 and from 10 November 2003 onwards in respect of J and S. In my judgment, the tribunal was entitled to conclude on the confusing evidence before it, and despite the oddity mentioned in paragraph 18 above, that the claimant was not entitled to child benefit in respect of any of his children, in the necessary sense of a decision having been made by the child benefit authorities that he was so entitled, for any period prior to 1 September 2003. The written submission to the tribunal on behalf of the claimant (paragraph 23 above) was really that the claimant ought to have been entitled to child benefit for all of the period from 14 June 2002. It is a general condition of entitlement to child benefit that a claim has been made for it within the prescribed time (Social Security Administration Act 1992, section 13(1)). The state of the evidence before it did not suggest any such claim before that on which the award from 1 September 2003 was made and it has not been suggested on behalf of the claimant that he made any claim for child benefit or was awarded child benefit for any earlier dates. I am also satisfied that the tribunal was entitled to conclude on the evidence before it that the claimant had not in the period in question been contributing to the maintenance of his wife and any children not living with him.

 

33. Those findings of fact (apart from that about the claimant's child benefit entitlement from 1 September 2003) cannot therefore be impugned as involving errors of law and I proceed on the basis of accepting their correctness. If the claimant asserts that the tribunal's decision was based on ignorance or mistake of some material fact (eg about his entitlement to or claims for child benefit before 1 September 2003 or rather, to make any difference for the reasons accepted in paragraphs 49 to 56 below, 6 April 2003), he could apply for its decision to be superseded on that ground under section 10 of the Social Security Act 1998 and regulation 6(2)(c)(i) of the Social Security and Child Support (Decisions and Appeals) Regulations 1999. But that would run into difficult problems about the date from which any superseding decision made now could take effect. Much more important, the same issue could be raised in relation to my decision on overpayment recoverability in CIB/156/2009. I deal with it in that decision.

 

Was there power in law on 11 July 2006 to supersede the decision of 3 May 1994 with effect from 14 June 2002?

34. I start with this as the most fundamental issue. The simplest way through the technicalities is for me to set out my conclusions stage by stage, especially as I now think that there was at least one important mistake in the way I set out the issue on 16 February 2009.

 

35. As already noted, section 10 of the 1998 Act allows supersession only of any decision of the Secretary of State under section 8 (decisions on claims for relevant benefits or under relevant enactments) or section 10 itself. However, because there had to be a mechanism to change decisions made before the 1998 Act came into force, at which time decisions on claims were not made by the Secretary of State but by independent officers under various names and under different legislation, there was special provision made in the various Commencement Orders bringing the 1998 Act into force on different dates for the purposes of different benefits.

 

36. In relation to incapacity benefit the relevant Order was the Social Security Act 1998 (Commencement No 9, and Savings and Consequential and Transitional Provisions) Order 1999, operative from 6 September 1999. Paragraph 4(1) of Schedule 14 to the Order provided that:

 

"(1) A decision (other than a decision of a social security appeal tribunal, a medical appeal tribunal or a Commissioner), made before 6th September 1999--

 (a) on a claim for; or

 (b) under or by virtue of Part II of the [Social Security Administration Act 1992] in relation to,

a relevant benefit, shall be treated on or after that date as a decision of the Secretary of State under paragraph (a) or, as the case may be, paragraph (c) of section 8(1)."

 

That provision has been described as "re-basing" pre-6 September 1999 decisions, so that they satisfy the conditions for supersession in section 10 of the 1998 Act that they were made by the Secretary of State and under section 8. However, that re-basing only applies where the old decision was made on a claim for a "relevant benefit" or under the Social Security Administration Act 1992.

 

37. "Relevant benefit" is defined in article 1(2)(c) of the Commencement No 9 Order as, unless the context otherwise requires, "any of the benefits to which article 2(c) of this Order refers". The benefits mentioned in article 2(c) include "benefits under Part II of the Contributions and Benefits Act except child's special allowance" (head (i)) and "increases for dependants under Part IV of that Act" (head (iv)). As at September 1999, the benefits under Part II of the Contributions and Benefits Act, as set out in section 20 under the heading "descriptions of contributory benefits" included short-term and long-term incapacity benefit, but not (since it was no longer a current benefit) invalidity benefit. Part IV at that time still included provision for increases for dependent children as well as adult dependents but only as increases to short-term and long-term incapacity benefit.

 

38. In paragraph 3 of my ruling of 15 February 2009 I said that the definition of "relevant benefit" in Article 1(2)(c) was restricted to current benefits, not benefits that had been abolished. That was a fundamental mistake. There is no reason why "a benefit under Part II of the Contributions and Benefits Act" should not refer to a benefit that came under Part II when the relevant decision in relation to it was given, even though it has later been removed from that Part. That seems to me to reflect the natural meaning of the words, especially so in the context of paragraph 4(1) of Schedule 14 to the Commencement No 9 Order, which directs one to the time at which the decision potentially to be re-based was made. The same reasoning applies to increases for dependents which came within Part IV of the Contributions and Benefits Act when they were awarded. The decision of 3 May 1994 in the present case was made under the Administration Act and concerned a benefit under Part II of the Contributions and Benefits Act as it was at the time. Therefore, from 6 September 1999, it was re-based as a decision of the Secretary of State under section 8(1) of the Social Security Act 1998.

 

39. The crucial difference between the present case and the circumstances discussed in the decision of Mr Commissioner Lloyd-Davies in CDLA/2999/2004 is that the decision sought to be superseded in the present case was given under the Administration Act and the Contributions and Benefits Act whereas the decision sought to be superseded in CDLA/2999/2004 was made before those Acts came into force, under the Social Security Act 1975. The problem identified by Mr Commissioner Lloyd-Davies was that mobility allowance, which had been awarded to the claimant there by a decision of 15 August 1986, had never been a benefit under the relevant Parts of the Contributions and Benefits Act. In August 1986 it was a benefit under section 37A of the Social Security Act 1975 and the legislation under the 1998 Act made no provision for the re-basing of such decisions or for bringing such benefits within the general meaning of "relevant benefit" in section 8(3) of that Act. 2006 and 2007 amendments have changed that.

 

40. There are some statements in the case-law apparently contrary to my conclusion in paragraph 38 above. In paragraph 30 of his judgment in Hooper v Secretary of State for Work and Pensions [2007] EWCA Civ 495, R(IB) 4/07, Dyson LJ said that at the material time "relevant benefit" in section 8(3) of the 1998 Act was defined to include incapacity benefit, but not invalidity benefit. It is important that Hooper was concerned with a purported supersession on 7 August 2004 of a decision of 4 June 1987 awarding the claimant invalidity benefit, ie under the Social Security Act 1975. Counsel for the Secretary of State in that case argued that the decision of 4 June 1987 was not one to award a relevant benefit. That was only followed through into a submission about how the provisions of regulation 7(2)(c) of the Social Security and Child Support (Decisions and Appeals) Regulations 1999 on the effective date of a supersession adverse to the claimant on the ground of relevant change of circumstances applied, not into the potential conclusion that the decision could not be superseded at all. Whatever the failure in following through the logic, Dyson LJ can only be taken as referring to invalidity benefit under the Social Security Act 1975 (or even earlier legislation) as excluded from the definition of relevant benefit, not to an exclusion of invalidity benefit under the Contributions and Benefits Act.

 

41. In decision CSIB/695/2004, one of the Commissioners' decisions discussed and approved as to the general reasoning in Hooper, Mrs Commissioner Parker apparently accepted the submission of counsel for the Secretary of State that "incapacity benefit but not invalidity benefit" was a relevant benefit under section 8(3) of the 1998 Act, although she rejected his further submission that regulation 17 of the Transitional Regulations converted an invalidity benefit decision operative immediately before 13 April 1995 into an incapacity benefit decision. That is a little more troublesome because the decision sought to be superseded in that case was made on 11 October 1993, ie under the Contributions and Benefits Act regime. However, the Commissioner's conclusion was that the invalidity benefit decision was susceptible to supersession on the ground of relevant change of circumstances under regulation 6(1)(a) of the Decisions and Appeals, and not under the ground relied on by the Secretary of State under regulation 6(1)(g). I therefore see no difficulty in interpreting counsel's submission as restricted to invalidity benefit under the Social Security Act 1975 (or earlier legislation) and not as excluding invalidity benefit under the Contributions and Benefits Act from the scope of "relevant benefit".

 

42. If it is necessary to consider whether invalidity benefit under the Contributions and Benefits Act is within the meaning of "a benefit under Parts II to V of the Contributions and Benefits Act" in the definition of "relevant benefit" in section 8(3) of the 1998 Act, then the same reasoning applies to reach the conclusion that it is.

 

43. The decision of 3 May 1994 could therefore be superseded on 11 July 2006 on the ground of relevant change of circumstances under regulation 6(1)(a) of the Decisions and Appeals Regulations, if there was such a relevant change, as the tribunal of 17 November 2008 found that there was. There is a further question as to the date from which a superseding decision on that ground could be effective. The fall-back rule in section 10(5) of the 1998 Act is that it takes effect from the date of the superseding decision itself (or the application for supersession if one was made). That rule would mean here that the claimant's entitlement to the increases for the period in question could not have been taken away on 11 July 2006. But section 10(5) is subject to section 10(6) which allows regulations to be made prescribing a different effective date. Regulation 7 of the Decisions and Appeals Regulations has done that.

 

44. In particular, regulation 7(2)(c) as in force on 11 July 2006 provided a complicated rule for cases where the decision on a supersession for change of circumstances is not advantageous to the claimant. I do not need to set it out in full. The essence for the present case is in regulation 7(2)(c)(v), which provides that, except in cases of the supersession of a disability benefit decision or an incapacity benefit decision where there has been an incapacity determination (and the change relates to the disability determination or the incapacity determination), the superseding decision takes effect from the date of the change. In the present case, the decision of 3 May 1994 was plainly not a disability benefit decision, because that category is restricted to defined benefits not including incapacity or invalidity or sickness benefit. By virtue of regulation 7A(1) as it stood at the time "incapacity benefit decision" meant:

 

"a decision to award a relevant benefit or relevant credit embodied in or necessary to which is a determination that a person is or is to be treated as incapable of work under Part XIIA of the Contributions and Benefits Act"

 

"Incapacity determination" meant:

 

"a determination whether a person is incapable of work by applying the personal capability assessment in regulation 24 of the Social Security (Incapacity for Work) (General) Regulations 1995 or whether a person is to be treated as incapable of work in accordance with regulation 10 (certain persons with a severe condition to be treated as incapable of work) or 27 (exceptional circumstances) of those Regulations"

 

45. The decision of 3 May 1994 was accordingly not an incapacity benefit decision as so defined on 11 July 2006. It came within the first part of the definition because it was to award a relevant benefit, but it could not embody a determination under Part XIIA of the Contributions and Benefits Act. That Part of the Act was only introduced with effect from 13 April 1995 on the transition from sickness and invalidity benefit to incapacity benefit. Nor could there have been an incapacity determination as defined, because that did not exist before the same date. That was the conclusion of the Court of Appeal in Hooper. Therefore, the rule in regulation 7(2)(c)(v) applies and the superseding decision of 11 July 2006 properly takes effect from the date of the relevant change of circumstances, 14 June 2002.

 

46. There could possibly in some cases be an argument that the form of regulation 7(2)(c)(ii) to (v) introduced with effect from 10 April 2006 cannot be used to take away benefit for a period before that date if the rules in that period would only have allowed a superseding decision to take effect from the date of the superseding decision. That argument cannot be raised in the present case. That is because, since the decision of 3 May 1994 was not an incapacity benefit or a disability benefit decision the same rule (effective from date of change) would have applied if the supersession had been carried out on 1 April 2006 instead of 11 July 2006. I shall not set out the pre-10 April 2006 form of regulation 7(2)(c), but merely record that in the circumstances of the present case the amendment from that date made no difference.

 

47. In Mr Coppel's written submission for the Secretary of State he argued that the effect of regulation 17(1) of the Transitional Regulations was that the decision of 3 May 1994 was to be treated as a decision to award incapacity benefit, in the form of transitional long-term incapacity benefit. Mr Cooper supported that submission at the hearing on 15 December 2010. But the relevance of that submission was limited to suggesting a way for the decision to be put within paragraph 4(1) of Schedule 14 to the Commencement No 9 Order. It had not at that stage been noticed that the decision of 3 May 1994 fell under the Contributions and Benefits Act regime and not the Social Security Act 1975 regime. The Secretary of State therefore as it turns out does not need to rely on that argument and it is better that I express no opinion on the complicated issues involved or on the effect of later amendments to the relevant definitions with effect from 24 September 2007. Nor could the argument possibly help the claimant to get within any more favourable rule in regulation 7(2)(c) of the Decisions and Appeals Regulations. The reasons set out in paragraph 45 above are compelling in support of the conclusion that the decision could not be an incapacity benefit decision as defined for that purpose, even if I were not bound by the Court of Appeal's decision in Hooper.

 

48. Accordingly, I conclude that there was no general legal obstacle to the Secretary of State's supersession on 11 July 2006 of the decision of 3 May 1994 on the ground of relevant change of circumstances with effect from 14 June 2002. The tribunal did not go wrong in law in its general confirmation of the superseding decision.

 

The claimant's potential entitlement to child dependency increases from 1 September 2003

49. The tribunal had to put itself in the shoes of the decision-maker of 11 July 2006, which involved asking whether the claimant was entitled to any dependants' increases for any part of the period from 14 June 2002 down to 11 July 2006. There was no realistic possibility, on the findings of fact made as to the lack of maintenance provided by the claimant, of any such entitlement to an increase for his wife. However, the uncontroverted evidence that the claimant was entitled to child benefit in respect of J and S at least from 1 September 2003 onwards (with a short gap) did raise a question of potential entitlement to increases for them. The tribunal did not examine that question because of its finding of fact apparently overlooking that evidence.

 

50. Mr Coppel for the Secretary of State submitted that there was a very short answer, although not quite as short as that suggested to the tribunal of 17 November 2008. Child dependency increases had been abolished from 6 April 2003 onwards and the claimant could not take advantage of the saving in article 3 of the 2003 Order (paragraph 20 above) because he was not entitled to an increase for J and S on 5 April 2003. The condition in article 3(2)(a) was not met.

 

51. I do not think that it is quite as easy as that. If the question had been asked on 5 April 2003, the answer would have been that the claimant was entitled to the increases for J and S and the other children. The decision awarding him the increases was still effective and had not been changed by that date. Indeed, article 3 must have constituted the legal authority for the continued payment to him of the child dependency increases, rather than that simply stopping them after the abolition date. Article 3(1)(b) makes special provision for the case where on 5 April 2003 a claimant was not entitled to an increase, but on a subsequent claim is determined to be entitled for a period including that date (for instance, through the operation of the rules on the date on which a claim is to be treated as made mentioned in article 3(3)(c)). Therefore, it is not entirely simple to say that entitlement under article 3(2)(a) must refer to entitlement as at that date, including as subsequently determined to be the case.

 

52. However, on the assumption that the claimant here falls within article 3(2)(a) (and it is only an assumption), in my judgment he is excluded by article 3(3). That provision was no doubt designed primarily to apply to the situation where continuing payment or entitlement to an increase is brought to an end at the time of some change of circumstances. Then, if what is interrupted is mere payability, there cannot be a resumption after 58 days (head (a)) or, if entitlement is terminated, it cannot subsequently be awarded again unless head (c) applies (head (b)). However, it seems to me that the words can equally apply where, as here, a supersession decision is given which operates back into a past period and removes entitlement or payability whether from a date before or after 6 April 2003. The position then has to be considered from the effective date of the termination. Here, the claimant's entitlement was removed from 14 June 2002. The result is that from 6 April 2003 the abolition of child dependency increases took over, unless he could get within head (c).

 

53. There is a very large initial obstacle, in that the claimant never in fact made a further claim for an increase for J and S, and would not have been able to do so while it was in payment. But even if that obstacle could be overcome by somehow saying that in cases of supersession going back into a past period entitlement could be reassessed as if a new claim had been made, ie from 1 September 2003, it would not help the claimant. The mechanisms in regulation 6(19) and (23) of the Claims and Payments Regulations referred to in head (c) for treating claims as made on the date when previous entitlement terminated are very specific. Regulation 6(23) applies only where entitlement to incapacity benefit as a whole ceases, which was not the case here. Regulation 6(19) could apply to the child dependency increase considered as a separate benefit (as it was under the Claims and Payments Regulations: regulation 2(3)), which could then be a relevant benefit within the meaning in regulation 6(22). It then operates where entitlement to some qualifying benefit, like child benefit for the child dependency increase, is in issue. But the claimant's entitlement to the increase did not terminate in one of the ways specified in regulation 6(20) as necessary to bring the mechanism into operation. A previous entitlement to child benefit was not terminated (regulation 6(20)(a)), there was not an outstanding undecided claim for child benefit as at the date the entitlement to the child dependency increases was terminated (regulation 6(20)(b)), and the qualifying benefit was not disability living allowance or attendance allowance (regulation 6(20)(c)).

 

54. Accordingly, I agree with the conclusion of the submission for the Secretary of State that on the supersession decision no entitlement to child dependency increases could be considered from 1 September 2003. The only legislative provision that was operative as at that date on the supersession was that abolishing child dependency increases.

 

55. Therefore, although the tribunal went wrong in law in making a finding of fact about the claimant's entitlement to child benefit that could not be supported on the evidence and in failing to deal with the question of whether a potential entitlement to child dependency increases as from 1 September 2003 could be taken into account, those errors did not affect the outcome of the appeal. As explained above, the result from 1 September 2003, just as from 14 June 2002, was that the claimant was not entitled to child dependency increases for any of his children. The errors of law do not justify the setting aside of the tribunal's decision.

 

56. For the same reason, any changes in child benefit entitlement and in the residence of the children after 1 September 2003 cannot affect the result that the claimant could not be entitled to child dependency increases.

 

Conclusion

57. For the reasons given above, the claimant's appeal on a point of law must be dismissed.

 

 

(Signed) J Mesher

  Judge of the Upper Tribunal

Date: 14 March 2011