Upper Tribunal (Administrative Appeals Chamber)

Appeal No.  CPC/4097/2014, CPC/4098/2014 & CPC/4100/2014

 

IN THE UPPER TRIBUNAL ADMINISTRATIVE APPEALS CHAMBER

 

Before Judge S M Lane

 

 

This decision is made under section 12(1) and (2)(a) and (b)(i) of the Tribunals, Courts and Enforcement Act 2007.

 

The decisions of the tribunal heard on 21 May 2014 under references SC232/13/01633, SC232/13/01634, SC/232/13/01718 are SET ASIDE because their  making involved errors of law. 

 

The appeal is REMITTED to a fully reconstituted tribunal for a complete rehearing.

 

 

REASONS FOR DECISION

 

1    It is disappointing for the Upper Tribunal to find itself dealing with the errors of law made by the First-tier Tribunal (‘the Tribunal’) which heard these three appeals. 

2    Although one can appreciate the Tribunal’s frustration at the Secretary of State’s apparent failure to comply with directions requiring him to attend the hearing of these cases, that does not  begin to justify the Tribunal’s failure (i) to carry out a complete rehearing of the matter on the merits, (ii) to perform its inquisitorial function when hearing an appeal, and (iii) to provide a fair hearing for both parties. The errors of law on any and all of these grounds justifies setting the decision aside and remitting to a freshly composed F-tT.

3    The short facts were that

The claimant (who is now the respondent to the action) appealed three decisions involving entitlement to, and overpayment of, State Pension Credit.  The Secretary of State had supplied a great deal of evidence to support his case, and a reasonably complete submission on issues (which were narrow) and the law for all three appeals. 

The Tribunal issued directions on two occasions requiring the Secretary of State to attend an oral hearing (188, 237), and if he did not intend to attend, to supply reasons.  Non-compliance with either of these directions, the Tribunal said, may result ‘in the Tribunal exercising any of its powers under The Tribunal Procedure (First-tier Tribunal)(SEC) Rules 2008 (the First-tier Procedure Rules).  The particular rules that might be applicable were not identified.

The Secretary of State did not send a presenting officer or provide an explanation for non-attendance.  The Tribunal decided that it would not adjourn the hearing and thereby inconvenience the appellant, who was present.  

The Records of Proceedings for two of the appeals simply state ‘see 01718’ (SC/232/13/01718, the third appeal).  The Record of Proceedings for 01718 states ’PS [pension service] not here.  Not in building.  Checked to see if here and not.  Not on GAPS.  Not know why here.  Proceed 2 and 31.  See decision.’  The Tribunal then allowed all 3 appeals without further ado. 

 

4    The decision notice is in the following terms (p250-251), with italics added for emphasis where that is important:

…3. The Secretary of State has failed to prove his case in relation to each of the decisions made.

Reasons

‘The Secretary of State was advised of the hearing in relation to all 3 appeals…

…

An integral part of a judicial system and the right to a fair hearing is the parties to appeal attend [sic] to explain their case and provide, if necessary, assistance to the Tribunal so that it can carry out its function.

The failure by the Secretary of State to attend the hearing or even to provide an explanation as to why they have not appeared especially after they have been directed to attend undermines the rule of law and the right to a fair hearing.  It prevents the Tribunal from properly carrying out its function.

In the circumstances the Tribunal was not prepared to accept the evidence of the Secretary of State.  The Tribunal disregarded the evidence of the Secretary of State and therefore the Secretary of State has failed to prove his case.

The tribunal exercised its powers under the First-tier Procedure Rules 2008 and decided it would be unfair to adjourn because it places further burdens on [the claimant].  The Secretary of State heads a multi billion pound organisation which has the resources to attend hearings it is legally directed to attend.  It was not appropriate to further delay the hearing of this appeal, which has been going on for at least a year, to give the Secretary of State another opportunity to come to a hearing.  If the Secretary of State is not concerned enough to attend a hearing to explain and defend the decision made the Tribunal is not going to afford him another opportunity to come to an hearing.  To do so would contravene the overriding objective in Rule 2’.

 

5    The Statement of Reasons goes on to explain

13           ‘The best way of ensuring a fair hearing occurs is if the parties attend the hearing.  There are several reasons for this.  First it shows the parties are serious about what they are claiming if they are prepared to spend the time and effort into explaining their position.  Secondly, although many of the issues are covered within the papers the hearing itself frequently raises other issues which need to be explored.  It may be more detail is obtained…or, it might be an issue which comes to light as a consequence of the hearing which could not have been anticipated… thirdly, appeals of the type [in this case] quite often involve an understanding of processes involved by the Secretary of State.  Those processes are invariably not included within the papers. An understanding of them can greatly assist the decision making…presenting officers …will have that detailed practical knowledge of what occurs on a day to day basis.

14           …it may be that [the Secretary of State’s] representative may not need to add a great deal without the information that is before the Tribunal in paper form.  However, whether that will occur or not is invariably very difficult to discern simply by reading the papers.

15           Tribunals are inquisitorial bodies.  Appeals are a complete rehearing of the issues…The parties have a legal responsibility to cooperate with the Tribunal in the performance of its function.  The Tribunal’s function is to decide the appropriate level benefit, if any.  The best way of ensuring that it occurs if the parties attend…

20           In the absence of the Secretary of State the Tribunal was not prepared to consider the evidence.  There were too many uncertainties in the information presented about the decision making process and the evidence used … which meant it would have been grossly unfair and unjust on the appellant to be asked detailed questions.  The Tribunal was being asked to make decisions and find facts on complex and uncertain matters which the Secretary of State could have assisted the Tribunal with.  The Tribunal concluded it would have been contrary to the interest of justice and the overriding objective in rule 2 of the First-tier Procedure Rules to allow the Secretary of State to present evidence in this appeal.  The Tribunal was not prepared to accept the evidence of the Secretary of State.  There was a very real possibility the Tribunal would have made a decision on the basis of incomplete information.  The Tribunal’s independence was also being undermined because the Tribunal was being forced to perform the functions of the Secretary of State.

 

6    The Tribunal, which is a specialist in social entitlement law, did not give any indication in either of the sets of directions he drew up, or in the decision notice, or Statement of Reasons of any area of procedural, evidential or legal difficulty with which the Secretary of State’s assistance might be needed.  As it happened, the Tribunal was comprised of a single Tribunal Judge who remained the same throughout the proceedings.  There was ample time for him to have given meaningful directions which facilitated an effective hearing.  Instead the Tribunal’s directions fretted vaguely about unspecified possibilities that might or might not occur. 

 

The function of a Tribunal and its duties on an appeal made under the Social Security Act 1998

 

7    Although the Tribunal recited the principles which govern its functions correctly, its application of those principles was so lacking in judgment that the decision cannot be sustained.

8    The function of a Tribunal is to carry out a complete reconsideration and redetermination of the facts and merits of the decision under appeal.  It performs an inquisitorial role when carrying out this function.  These principles have been consistently stated in case law binding on tribunals for nearly 60 years.  They are reiterated in relation to appeals under the Social Security Act 1998 in R(IS) 17/04, a decision of a Tribunal of Commissioners.  Neither the Tribunals Courts and Enforcement Act 2007 nor the Procedure Rules change the principle, or any of the others set out in that case.

9    The headnote in R(IS) 17/04 sets out this principle and the primary duties of tribunals :

Held, allowing the appeal, that:

1. the function of a tribunal in every case is to carry out a complete reconsideration and redetermination of the facts and merits of the decision under appeal (paragraph 26); R v. Deputy Industrial Injuries Commissioner ex parte Moore [1965] 1 QB 456, R v. Medical Appeal Tribunal ex parte Hubble [1958] 2 QB 228, R(S) 4/82, CIB/4751/2002 [reported as R(IB) 2/04] and Kerr v. Department for Social Development (Northern Ireland) [2004] UKHL 23 followed.

2. the practical options that were open to the chairman in this case were therefore to conduct a full hearing on the material, evidence and representations before him or to adjourn (paragraphs 27 and 28);

3. the chairman’s own note of the proceedings and statement  of reasons showed he had done neither, but instead proceeded to a decision in favour of the claimant without going into the merits of the case at all. That was an error as the evidence before him showed the need for a proper enquiry (CI/1021/2001 followed) (paragraph 29);

4. the duty of a tribunal to investigate the issues before it could legitimately involve questioning a claimant, even with probing questions, and there could be no question of bias or unfairness in the mere fact that it did so (R(IS) 4/82 followed) (paragraph 30);

5. the Tribunal of Commissioners noted and approved an assurance by the Secretary of State that measures were to be taken to ensure the attendance of a presenting officer in any case where directed by a tribunal, or if the complexity of the case requires it, whether or not such a direction has been given.

 

The Tribunal of Commissioners expands on its reasoning in the following paragraphs:

‘25. …In relation to the case before us, we have to decide whether, in the difficult circumstances in which he found himself, the tribunal chairman did or did not err in law.  In our judgment, we consider he unfortunately did fall into error. We consider that, in determining the appeal in favour of the claimant in the way he did – immediately after deciding against an adjournment, and without taking evidence or recording findings of his own as to what the actual facts were – Mr Warren must have misdirected himself as to the right course for a tribunal in this difficult situation; and his decision must consequently be set aside as erroneous in law.

26. It is not in our judgment open to doubt that, as an appeal tribunal under the Social Security Act 1998 hearing the claimant’s appeal against the departmental determination revoking her entitlement to benefit, Mr Warren was sitting as an “inquisitorial” tribunal. By that we mean his function was to carry out a complete reconsideration and redetermination for himself of the facts and merits of the decision under appeal, the purpose being to ascertain and determine the true amount of social security benefit to which the claimant was properly entitled: see R v. Deputy Industrial Injuries Commissioner ex parte Moore 1 QB 456 and R v. Medical Appeal Tribunal ex parte Hubble 2 QB 228 referred to above; the Commissioners’ case R(S) 4/82 (especially paragraph 25) and the recent decision of a Tribunal of Commissioners in CIB/4751/2002 [reported as R(IB) 2/04] (especially paragraph 32); and the further recent reaffirmation of the principle in Kerr v. Department for Social Development (Northern Ireland) UKHL 23 [R 1/04 (SF) (especially at paragraph 14 per Lord Hope, and paragraph 61 per Lady Hale). In our judgment this is and remains a principle of general application to all proceedings in such tribunals… Mr Warren [the Tribunal chairman] was right in directing himself as he did in paragraph 14 of his statement of reasons that the proceedings before him were not adversarial and he did not have any power to enter judgment in default against a party who failed to comply with a direction or to attend.

27. The practical options in the circumstances that faced Mr Warren on the hearing date were therefore:

to proceed to conduct a full hearing and determination of the facts and merits on such material, written and oral evidence and representation as he had before him on 6 January 2003; or

to adjourn for the purpose of being better able to conduct such a hearing at another date, if he considered the interests of justice required it.

28. Which of these courses to adopt was a matter for his procedural discretion and judgment in the management of the case. In our view he was fully entitled to decide against an adjournment of the proceedings, for the reasons summarised in paragraph 13 of his statement. On the footing that the alternative was to proceed to a determination of the facts and merits – as Mr Wilson appears to have envisaged in opposing the adjournment by reference to his submission on the factual issues – that was an entirely proper exercise of the chairman’s discretion...

29. However, we have to accept Mr Coppel’s submission that the chairman misdirected himself and fell into error of law in what he proceeded to do then. It is in our judgment quite clear from the final part of his contemporaneous note of the proceedings, and the reasons he recorded in paragraph 15 of his statement, that the chairman decided to go ahead with the determination of the appeal on 6 January 2003 by recording a decision in favour of the claimant immediately after announcing his refusal of the adjournment, and without going into the merits of the case at all, on the basis that the absence of a presenting officer prevented the burden of proof being discharged. In that we think the chairman was plainly mistaken, since the effect was that he put himself in the position of making a final determination, without having carried out his primary duty as an inquisitorial body to address the merits and the evidence in the case for himself and make and record findings of his own on the material facts necessary for its proper decision. A tribunal is not entitled to rely upon a “failure to discharge the burden of proof as a substitute for a proper enquiry where there is evidence that there is something into which there needs to be an enquiry” (CI/1021/2001, paragraph 9: Mr Commissioner Angus).

30. We do not agree with the chairman’s recorded view, reiterated in the submissions made to us by Mr Seddon, that the absence of a presenting officer made it impossible for a fair hearing to be conducted into the merits in this particular case. There was a written submission on behalf of the Secretary of State before the tribunal. The claimant was represented and the claimant’s representative had prepared a detailed rebuttal of the Secretary of State’s submission. The chairman could have put the points made in the written submission to the claimant and come to a conclusion based on the claimant’s replies, any cross-examination of the investigating officers by the claimant’s representative and the representative’s submission. It is notable that in his full statement the chairman himself does not refer to any difficulty that he might have had in questioning the claimant: the difficulties to which he refers are those of not having a presenting officer to present the case or the investigating officers for cross-examination. If the chairman had put the Secretary of State’s case to the claimant and asked the investigating officers to proffer themselves for cross-examination, this would not, in our judgment, have affected the independence or impartiality of the tribunal or fairness of the proceedings. The duty of a tribunal to investigate the issues before it can legitimately involve the chairman questioning the claimant, even with probing questions – see, for example, the decision of a Tribunal of Commissioners in R(S) 4/82, particularly at paragraphs 27 to 28. In that case it was pointed out by the Tribunal that it was the clear duty of the tribunal members, in the exercise of their investigatory functions, to ask the claimant the obvious questions which arose: and there could be no question of “bias” or unfairness in the mere fact that they did so. Of course any interventions by the chairman himself to identify points that required an answer would have to be made carefully and phrased factually and neutrally: but that is a skill developed and deployed by all chairmen experienced at conducting proceedings of an inquisitorial nature, and as often needed when parties are represented as when they are not.

31. We therefore consider the chairman’s lack of confidence in his own ability to conduct a fair hearing of the merits in these circumstances was undoubtedly misplaced; but in any case having decided not to adjourn we consider he erred in law in declining even to attempt such an exercise before determining the case in favour of the claimant as he did. That amounted to – or at least came perilously close to – pronouncing the “default judgment” he had rightly earlier directed himself he had no power to give.

 

10 The Tribunal in the appeal before me replicated each of the errors made by the Appeals Tribunal in R(IS)17/04.  I can only assume that R(IS)17/04 escaped this experienced Tribunal judge’s memory on this occasion.

11 These errors would be basis enough to allow the Secretary of State’s appeal.  There are, however, several other errors of law which I address briefly. 

 

The right to a fair hearing and the principles of natural justice

 

12 The F-tT stated in the decision notice that it ‘disregarded the Secretary of State’s evidence’ and later said it ‘was not prepared to accept the Secretary of State’s evidence’.  In the Statement of Reasons the F-tT stated that it was ‘not prepared to consider the Secretary of State’s evidence’ and later ‘it was not prepared to accept’ that evidence.

13 Disregarding evidence and not accepting it are two different things.  Disregarding it means that it is entirely left out of account.  It is never weighed in any balance, no matter how meritorious the evidence is.  Not accepting evidence, on the other hand, imports a process of analysis and discrimination.

14 Whether or not Art. 6 of the European Convention on Human Rights applies to the State as a party to this litigation, I am satisfied that the F-tT failed to provide the Secretary of State with a fair hearing.  It makes little or no difference whether this is described as a breach of natural justice through a failure to hear both sides of the case, or as a breach of the right to a fair hearing as required by domestic law or as envisaged by the ECHR.  Although the rules of natural justice may be narrower than the right to a fair trial, it is reasonably clear that the right to a fair trial has found its place in domestic law and is largely coterminous with the Convention right.  In MNM (Surendren Guidelines) [2000] UKIAT 5, the Immigration Appeals Tribunal held that whether or not Article 6(1) [of the ECHR] applied -

16. … will make little if any difference. The fact is that the IAA provides an independent and impartial tribunal established by law. The hearing is in public and the procedures are designed to ensure that it is fair. If there is any unfairness, the tribunal or the Court of Appeal will correct it. Thus any complaints that the special adjudicator conducted an unfair hearing fall to be considered by us and we apply the same tests as would be applicable if Article 6(1) applied…

I see no reason to depart from this view.

15 Insofar as the F-tT ‘did not accept the Secretary of State’s evidence’, the Tribunal was required to give reasons for doing so.  The reasons must relate to an analysis of the content or quality of the evidence.  The duty to give reasons was not satisfied by raising worries about issues that might arise or which might require the Secretary of State’s assistance.  It is not possible to see how these unparticularised fears could provide a rational explanation for refusing to accept the totality of the Secretary of State’s evidence (and, indeed, his submissions), whether controversial or not and however or from whomever his evidence was obtained. 

Was the F-tT relying on a rule under The Tribunal Procedure (First-tier Tribunal)(SEC) Rules 2008 in taking its course of action?  If so, which one? 

 

16 There are 41 rules to choose from, but the F-tT did not say which rule it relied on. 

17 In attempting to fathom the powers the F-tT might have exercised, the Secretary of State speculated whether the F-tT relied on rule 8, which governs striking out an appellant’s case or barring a respondent from participating further in proceedings.  If a respondent is barred, the F-tT need not consider any response or other submission made by that respondent and may summarily determine any or all issues against them [rule 8(8)].  

18 Upper Tribunal Judge Jacobs dealt with the difficulties of rule 8 in relation to barring a respondent in SL v Secretary of State for Work and Pensions and KL-D [2014] UKUT 128 (AAC).  I respectfully agree with, and repeat, what Judge Jacobs says at [17] and [18]:

17 Rule 8 bars a party from taking further part in the proceedings. It does not operate retrospectively to render that which has already been done nugatory or invalid: rule 7(1). Evidence submitted and submissions made remain before the tribunal and have to be taken into account. When it provides that ‘the Tribunal need not consider any response or other submission made by that respondent’ it means any future response or submission.

18 Rule 8(8) provides that the tribunal ‘may summarily determine any or all issues against that respondent.’ This is not a penal provision. The tribunal cannot simply accept the appellant’s case if the respondent is barred.  It must still act in accordance with the overriding objective when considering whether to exercise this power. And it is, on basic principle as part of its duty to act fairly, required to act rationally on material of probative value in making its decision: Mahon v New Zealand Ltd [1984] AC 808 at 820-821 (Lord Diplock). This requires it to give proper consideration to submissions made and to take account of evidence submitted. The key word in rule 8(8) is summarily. It allows the tribunal to deal with the respondent’s case rather more briefly than would otherwise be required.

19 Having regard to SL v Secretary of State for Work and Pensions  it is clear that, if the F-tT did intend to rely on rule 8, it misunderstood the scope of that rule.  This may have contributed to its failure to consider the evidence and submissions before it. 

20 If the F-tT did intend to rely on rule 8 to justify its action, it made a further error of law by failing to give an express warning to the Secretary of State as required under various parts of rule 8.  These warnings are necessary so that parties can be aware of the harsh consequences of non-compliance with directions and adjust their behaviour accordingly.  It is nothing to the point that the F-tT stated that it would consider ‘exercising any power under the First-tier Procedure Rules’.  This simply does not inform parties of what may, or will, happen in the event of non-compliance with a direction.  A Tribunal wishing to travel down the rule 8 road must be very clear about the power it is exercising and what is means for the party affected.

21 The F-tT additionally failed to explain how its treatment of the Secretary of State’s case complied with the overriding objective in rule 2.

2.(1) The overriding objective of these Rules is to enable the Tribunal to deal with cases fairly and justly.

(2) Dealing with a case fairly and justly includes—

(a) dealing with the case in ways which are proportionate to the importance of the case, the complexity of the issues, the anticipated costs and the resources of the parties;

(b) avoiding unnecessary formality and seeking flexibility in the proceedings;

(c) ensuring, so far as practicable, that the parties are able to participate fully in the proceedings;

(d) using any special expertise of the Tribunal effectively; and

(e) avoiding delay, so far as compatible with proper consideration of the issues.

 

(3) The Tribunal must seek to give effect to the overriding objective when it –

(a)   exercises any power under these Rules; or

(b)   interprets any rule or practice direction

 

(4) Parties must

(a)   help the Tribunal to further the overriding objective; and

(b)   co-operate with the Tribunal generally.

22 Quite apart from its failure to give adequate warning of the consequences of not complying with the directions to send a presenting officer, it is not possible to see how determining the case as it did was fair.  There was ample relevant, admissible evidence which had been supplied to the claimant well in advance; the Tribunal had special expertise which should have been employed; the F-tT did not identify any particular difficulty which would prevent it from determining the issues; the lack of a presenting officer did not prevent Tribunal from exercising its inquisitorial duty, and the claimant was present and able to address the evidence.  Why the F-tT thought it grossly unfair to ask him to tell his side of the story and at the same time refused to consider any aspect of the Secretary of State’s case, is a mystery. 

23 I mention for completeness sake that, if the F-tT intended to rely on its discretion under rule 15 to exclude evidence, it failed to exercise that discretion under that rule judicially.  This is a variation on the themes set out earlier and I see no reason to prolong this decision by exploring them further. 

24 The appeal must be remitted to a freshly composed F-tT for a full hearing.

 

 

 

[Signed on original] S M Lane

Judge of the Upper Tribunal

[Date] 13 August 2015