Upper Tribunal (Administrative Appeals Chamber)

IN THE UPPER TRIBUNAL Case No.  CH/471/2012

ADMINISTRATIVE APPEALS CHAMBER

Before Judge Mark

Decision:  The appeal is allowed.  I set aside the decision of the tribunal and remit the matter to be reheard by a new tribunal in accordance with the directions below.

REASONS FOR DECISION

1.     The claimant was in receipt of housing and council tax benefit from November 2000 until May 2007.  She was the tenant of her home, but in May 2007, together with a Mr. G., she bought her home under the right to buy legislation and notified the council that she no longer wished to claim either benefit.

2.     Her entitlement to benefit derived from her being in receipt of income support.  She appears to have declared throughout both to the DWP and to the council that she was a single parent living alone with her children.  An investigation in 2009 led to the conclusion on the part of both the DWP and the council that at least from May 2005 she had been living with Mr. G as husband and wife.  Part of the evidence in support of this was that in purchasing the property and applying for a mortgage for this purpose and to effect improvements to the property, the claimant and Mr. G declared that they had been partners living at the same address for several years.

3.     It would appear that, following the investigation, a decision maker on behalf of the Secretary of State decided to supersede the award of income support from 23 May 2005, and subsequently by a decision dated 14 September 2009, a decision maker on behalf of the council superseded the awards of housing and council tax benefits from the same date.  There followed overpayment decisions by the council in respect of both benefits covering, with regard to both benefits, the period from 30 May 2005 to 6 May 2007. 

4.     The claimant appealed both those decisions and, it would appear from paragraph 3 of the statement of reasons subsequently provided by the tribunal judge, she also appealed either the supersession decision of the DWP or, possibly if there was one, a subsequent overpayment decision in respect of overpaid income support.  It would appear that both appeals were heard together by the same tribunal, and both files were considered for the purpose of the decision then given.  Indeed, the statement of reasons in relation to this appeal specifically refers to and takes into account evidence only to be found on the income support file.

5.     I do not have a copy of the income support file.  It is plain that this should be preserved and that it should also be available to the new tribunal when this case is reheard.  It would appear that, whatever the outcome of that appeal, at least when the statement of reasons for this appeal was prepared, no statement had been requested by either party on that appeal.  I therefore do not know the outcome of that appeal or the reasons for it, or the evidence on which it was based, but these are all matters which can affect the outcome of the new hearing of this appeal and should be available to the new tribunal.

6.     Before the appeals to the tribunal could be heard, the claimant was charged with offences with regard to her claims for housing benefit and council tax benefit.  It would appear from the statement of reasons that she had originally pleaded not guilty, on the basis that she claimed that she and Mr. G were not living together as husband and wife.  At the hearing the claimant had changed at least one of her pleas to guilty.  It would appear from paragraph 12 of the statement of reasons that the tribunal was told that there had been some guilty and some not guilty pleas and the not guilty pleas had not been pursued.

7.     The only direct evidence of the actual charges on the housing and council tax benefits appeal file was a prosecution report (pp.128-129) which describes the prosecution as having been initiated by the DWP and the type of offence as being failure to notify a change of circumstances to the DWP and the local authority namely living together as husband and wife.  The court had been notified beforehand of the “agency’s” intention to recover all allegedly overpaid benefits.  These totalled over £18,000 of which over £11,000 was income support and the rest housing and council tax benefit.  The prosecution was conducted by a DWP solicitor and the outcome is stated in the report to have been pleas of guilty and not guilty and the outcome to have been conviction.  If the not guilty plea or pleas remained on the file, the report would seem to be inaccurate in this respect.  The benefits included in the conviction were said in the report to have included all the housing and council tax benefits at stake in this case.  The claimant was sentenced to a community order for 2 years with an 8 weeks curfew, but no compensation was ordered and there was no order as to costs.

8.     According to the claimant, and as was accepted by the tribunal, she had pleaded guilty because her counsel had advised her that there was a risk of a mortgage fraud prosecution if she was to succeed in defending the charges against her in connection with benefit matters, and that would involve far greater amounts of money.

9.     The tribunal found that the claimant was entitled to argue her case before it despite the conviction, and concluded on the basis of the evidence before it that on the balance of probabilities the claimant was not living together with Mr. G as husband and wife and therefore the appeal was allowed and there had been no overpayment of benefit.

10. The council has appealed with the permission of the tribunal judge on two grounds – that the tribunal should have considered itself bound by the conviction and that the presenting officer for the council was not given a proper hearing.  It is unnecessary for me to consider in this case whether the presenting officer had a proper opportunity, as I have come to the conclusion that the question of the effect of the claimant’s conviction was not properly investigated by the tribunal for the reasons to which I shall now turn, so that the matter must now be reheard by a new tribunal in any event.  In general, however, presenting officers should be aware of their rights and should seek to assert them at the hearing.  If they do not do so, they should not normally expect too much sympathy if they complain on an appeal that they did not get a fair hearing.

11. A further ground of appeal relied on by the council is that the tribunal held that the claimant had obtained a sum in excess of the purchase price. By way of mortgage.  It is said to be perverse that the tribunal concluded that the claimant should not be liable to repay overpaid benefit.  It is said that the claimant received two amounts of money and should not have the benefit of both.  I find this submission incomprehensible.  As found by the tribunal, in May 2007 or thereabouts the claimant received a mortgage advance from a lender (there is no finding as to the identity of the lender and no evidence before me in the tribunal file) by representing that the claimant and Mr. G were partners and had been for some years.  If that representation was false as the tribunal held it to be, that may give the mortgage lender rights to sue the claimant for damages and other relief, possibly in fraud.  Its falsity cannot possibly affect the claimant’s entitlement to benefit in the preceding two years.

12. The effect of the conviction is another matter.  I dealt with this question at some length very recently in CDLA/759/2012.  In that case, an appointee had been convicted of failing to report a change of circumstances which affected the claimant’s entitlement to benefit.  I found that the Secretary of State could not rely on the conviction as against the claimant who had not been a party to the criminal proceedings.  I also, however, considered the position of the appointee against whom recovery of an alleged overpayment was also sought. My findings in that respect are of equal relevance to the claimant in the present case, who was a party to the criminal proceedings.

13. In that case, I concluded that proceedings before the First-tier Tribunal in social security proceedings are proceedings to which the strict rules of evidence do not apply and are therefore outside the ambit of sections 11 and 18 of the Civil Evidence Act 1968.  The conviction does not, therefore, alter the legal burden of proof and, as a matter of evidence, is no more than the opinion of the criminal court that the accused was guilty of the offence charged.  On the authorities, this is not an expert opinion and has no probative value, although a guilty plea on which the conviction was based is an admission and does have probative value. 

14. I then went on to consider whether, in the light of Hunter v  Chief Constable of the West Midlands Police, [1982] AC 529, there is a public policy requirement either that a conviction cannot be challenged or else that there is some limit on the circumstances in which it can be challenged.  I put the position as follows in paragraphs 25 to 38:

25.  A separate question is whether there is some public policy requirement that might preclude a convicted person from challenging his conviction.  In Hunter v Chief Constable of the West Midlands Police, the House of Lords held that where a final decision had been made by a criminal court of competent jurisdiction it was a general rule of public policy that the use of a civil action to initiate a collateral attack on that decision was an abuse of the process of the court.  It was further held that in that case such fresh action as the plaintiff sought to adduce in his civil action fell far short of satisfying the test to be applied in considering whether an exception to that general rule of public policy should be made, which in the case of a collateral attack in a court of co-ordinate jurisdiction, was whether the fresh evidence entirely changed the aspect of the case.  The case involved an unsuccessful attempt by the “Birmingham Six” to attack their conviction for murder largely based on confessions said to have been induced by violence and threats, and it may not be entirely inapposite to recall that they did eventually have their convictions set aside as unsatisfactory and were awarded compensation for their incarceration over many years.

26.  I have been referred to two subsequent cases in which there has been a refusal by the courts to permit a person convicted of an offence to attempt to get a civil court to review his conviction.  Both were concerned with applications to renew private hire or hackney cab licences and both were in relation to the question whether the applicant was a fit and proper person to hold the relevant licence.  In Adamson v Waveney DC, [1997] 2 All ER 898, at p.904, Sedley J stated as follows:

a.     “Once some or all of the spent convictions are admitted in evidence … the applicant is then entitled naturally to be heard, not by way of suggesting that the convictions were incorrectly arrived at but in order to persuade the judicial authority that they are either, in truth, irrelevant or such, by reason of their age, circumstances or lack of seriousness, that they should not jeopardise his application.  All of that is simple natural justice.”

27.  In Nottingham City Council v Farooq, [1998] EWHC Admin 991, Tucker J, relying on the passages I have cited from Hunter and from Adamson, held that the Justices, acting as a civil appeal court, were not entitled to review the merits of the respondent’s convictions for theft and deception.  In that case, the respondent had pleaded guilty to the criminal charges in question but was seeking to say that he did so to assist a friend.

28.  As the representative of the Secretary of State has pointed out on this appeal, the First-tier Tribunal has no inherent jurisdiction to strike out an appeal beyond the powers conferred by regulation 8 of the Tribunal Procedure (First-tier Tribunal) (Social Entitlement Chamber) Rules 2008 (the 2008 Rules).  He has also pointed out that, as I have already indicated, section 11 of the Civil Evidence Act does not apply to social security decision making; that a criminal conviction does not constitute res judicata as regards civil proceedings; that the language of plaintiffs and defendants is of dubious relevance to a tribunal whose jurisdiction is inquisitorial; and that it is hard to see how an appeal to a First-tier Tribunal lodged nearly a year before criminal charges were even laid can properly be regarded as a collateral attack on the court’s subsequent decision on those charges.

29.  In my judgment, the essence of the decision of the House of Lords in Hunter was that it is in general contrary to public policy for a party to use civil proceedings to attack a criminal conviction against himself.  That appears to me to be the case whether the civil proceedings commenced before or after the conviction, and is unrelated to the doctrine of res judicata.  It also applies whether the civil proceedings are adversarial or inquisitorial.  Subject to any exception to the general rule, the judge in inquisitorial proceedings should not review the merits of the conviction at the instigation of the person convicted.  If, bearing that in mind, there is no prospect of an appellant’s case, or part of it, succeeding the tribunal has power under rule 8(3)(c) of the 2008 Rules to strike out the whole or part of the proceedings.

30.  The crucial questions, however, are (1) whether there is any, and if so what, exception to that general rule in social security appeals, and (2) as to the nature of any investigation into the factual and legal basis of the conviction.  I start with the latter question.  As Sedley J pointed out in Adamson, it is open to a party to try to persuade the tribunal that by reason of the age, circumstances or lack of seriousness of the facts on which the conviction was based that it should not jeopardise his application.

31.  Further, it is necessary to analyse with care the findings of fact and law made by the criminal court insofar as a charge has been contested, and to consider the evidence before that court on which the conviction was based, which was not necessarily the whole of the evidence before it.  If a party has pleaded guilty to a charge, it is necessary to consider both the charge, including how specific it is, and the plea, to see what was alleged, and whether what was alleged has been admitted by the plea, or only certain aspects of it.

32.  Insofar as the party is only seeking to explain the circumstances of the conviction and the facts on which it was based, without seeking to challenge those facts, there can be no possible objection to his doing so.

33.  It also appears to me that if the party in question is seeking to challenge the conviction in civil proceedings based on convincing new evidence that it was wrong, there can be no consideration of public policy which precludes him from doing so before a tribunal when section 11 of the Civil Evidence Act 1968 permits him to do so in another court.

34.  That leaves open whether there should be any exception to the general rule of public policy where there is no new convincing evidence and the party is seeking not just to go into the details of the conviction but to challenge it.  In this respect there appears to me to be a difference between the primary findings of fact made by the criminal court based on the evidence before it, or the admissions involved in the plea of guilty, and any secondary inferences drawn by the criminal court.  A finding that a party did or did not make a statement is something well within the competence of any court or tribunal.  It is also able to determine whether or not, for example, a party was seen walking normally at a particular time, or looking after themselves in some way at a particular time.  I can see no reason why there should be any exception to the general rule which allows these matters to be relitigated.  The tribunal should treat any attempt to do so as against public policy and refuse to permit it except upon the basis on which it could be re-opened in courts where section 11 of the Civil Evidence Act 1968 applies.

35.  On the other hand, the assessment of benefit entitlement is entrusted by statute to the Secretary of State with an appeal to the First-tier Tribunal.  Special provision is made for that tribunal to consist of a judge with specialist knowledge of that area of the law and, in appropriate cases for there to be included on the tribunal a registered medical practitioner and a member with a disability qualification.  The judge, or the jury, in a criminal case will not normally have such expertise.

36.  Given that benefits are by statute to be determined by a specialist tribunal, it appears to me that there should be an exception to the general rule of public policy to the extent that the specialist tribunal should be able, in appropriate cases, to substitute its own findings as to social security law for that of the criminal court, and should be able to make its own findings as to the inferences and conclusions to be drawn from the primary facts found by, or admitted to, the criminal court, as to the abilities or otherwise of the claimant and his entitlement to benefit.

37.  By way of examples only, a tribunal should not be precluded by public policy from refusing to take account of a conviction based on a person not being virtually unable to walk if the primary finding of the court has been that the person is not virtually unable to walk because he can walk 50 metres without the court considering the question of severe discomfort or the time, speed and manner of walking, or that he can perform certain descriptors for incapacity benefit or ESA without considering severe discomfort or reasonable repetition.  Even if these matters have been considered, moreover, it must be open to the tribunal, with the benefit of its medical member and the member with a disability qualification to use its superior expertise to come to a different conclusion, or draw different inferences, while taking into account the primary facts found by the criminal court.  It would also be open to the tribunal to consider whether there was any evidence before the criminal court upon which it could base a particular finding of fact, as pointed out in R(S) 10/79, paragraph 8.

38.  The new tribunal in the present case will therefore need to take into account the evidence before the criminal court and the admissions involved in any guilty plea by the appointee in considering the entitlement of the claimant, but it is in no way bound by the conviction of the appointee as regards its findings on the claimant’s claim.  Insofar as it finds against the claimant on her claim and there is an overpayment decision to be made against the appointee, the tribunal should take into account the general rule of public policy to which I have referred except to the extent indicated in this decision.”

15. I have been referred on this appeal to one additional authority by the council and to two further decisions by the judge giving permission to appeal.  In Sharma v Financial Services Authority, Reference number FS/2010/0008, a decision of the Upper Tribunal Tax and Chancery Chamber, the question was whether Mr. Sharma was a fit and proper person to conduct financial services business, having been convicted of two financial services related offences in the Westminster Magistrates Court.  It was held that a challenge to those convictions in relation to that issue was an abuse of process and he should not be permitted to relitigate those matters on which the conviction was based or go behind the convictions.  In this respect the decision appears to me to be in line with the decisions of Sedley J and Tucker J in Adamson and Farooq and to be distinguishable on the same basis.

16. In giving permission to appeal, the tribunal judge referred to the decision of Mr. Commissioner Henty in CIS/683/1994 and the decision in Northern Ireland of Mr. Commissioner Mullan in SG v Department for Social Development (IS)[2010] NI Com 17.  in both those cases, it was held that “the failure or deliberate omission to make a compensation or restitution order in criminal proceedings, arising from circumstances in which social security benefits have been overpaid, does not negate the right of the Department to seek to recover those overpaid benefits under separate statutory powers”.  I agree, but it does not assist with the question of the extent to which a person convicted of an offence can seek to undermine his or her conviction.

17. In the present case, it would appear that the claimant pleaded guilty to one of the offences charged because to contest the charges would, or may, have involved admitting to lying on the mortgage application form, and possibly in exercising the right to buy, and laid her open to more serious charges.  It appears to me to be wrong that the claimant should be able to take that course, and then seek to avoid the consequences by arguing that it was the mortgagee that she misled all along when faced with the consequences of her admission.

18. It therefore appears to me that there is a public policy concern that does prevent the claimant in this case from mounting an attack on her conviction.  Her attempt to do so is an abuse of process, and she should not be permitted to resile in these proceedings from her guilty plea in the criminal proceedings.

19. That is not the end of the matter, however.  So far as appears from the tribunal file in this case, there was no evidence before it as to precisely what the charge was that she pleaded guilty to.  There were apparently two charges against her and she only pleaded guilty to one of them.  The new tribunal will need evidence of the charges in question and the basis on which she pleaded guilty only to one of them.  It may have regard to what was said on her behalf by her counsel in relation to the plea and in mitigation and to anything said by the magistrates in accepting it and sentencing her.  If, for example, the guilty plea related only to what the claimant claimed or failed to disclose in 2006, and it was a charge relating to 2005 that was not proceeded with, it may well be open to the claimant, consistently with that plea, to assert before the tribunal that she was not living with Mr. G as husband and wife in 2005, or that she had ceased to do so by 2007.  In doing so, however, she cannot be allowed to backtrack on any factual admission in relation to the charge to which she pleaded guilty.  Although it would seem to be unlikely to be the case here, she may also be able to assert that she remained entitled to benefit to some degree despite the matters to which she pleaded guilty even during the period covered by the guilty plea.  The report of the prosecution that all the benefits were included in the conviction should not be accepted without knowing what the conviction was for and what charge was left undecided.

(signed) Michael Mark

Judge of the Upper Tribunal

5 March 2013