Case Nos: CH/2606/2014

CH/4625/2014

IN THE UPPER TRIBUNAL

ADMINISTRATIVE APPEALS CHAMBER

 

Before UPPER TRIBUNAL JUDGE KNOWLES QC

 

 

 

DECISION

 

 

This appeal is successful to the very limited extent identified below.

 

The decision of the First-tier Tribunal sitting at Liverpool on 6 March 2014 under file reference SC068/13/14093 [the M case] involved the making of an error on a point of law and is set aside. The matter is remitted to the First-tier Tribunal for rehearing before a differently constituted tribunal in accordance with the directions set out at the conclusion of these reasons.

 

The decision of the First-tier Tribunal sitting at Liverpool on 3 July 2014 under file reference SC068/14/00466 [the D case] involved the making of an error on a point of law and is set aside. The matter is remitted to the First-tier Tribunal for rehearing before a differently constituted tribunal in accordance with the directions set out at the conclusion of these reasons.

 

 

 

REASONS FOR DECISION

 

 

The Issue in these Appeals

 

 

1.        The issue in these two appeals is whether service charges relating to the supply of water in the communal areas of either sheltered or supported housing [“communal water charges”] are eligible for housing benefit [“HB”]. The Appellant local authority disallowed both claimants’ cases for housing benefit in respect of these communal water charges. Both claimants appealed and the First-tier Tribunal [“the tribunal”] allowed their appeals on the basis that such charges were indeed eligible for HB. The Appellant local authority sought and obtained permission to appeal to the Upper Tribunal in both cases.

 

2.        As this is an important issue which has not been the subject of any previous determination by the Upper Tribunal, the cases of M and D were joined in order that they might be determined together.

 

3.        In summary and in general terms, I find that communal water charges are an eligible service charge for residents in sheltered or supported housing. Residents in this type of accommodation are usually billed for water use by their landlords rather than having a separate liability to a water company. However, I set aside the tribunal’s decision as being in error of law for two main reasons.

 

4.        First, the tribunal erred in holding that Regulation 12B(5)(c) applied to both M and D since I find that Regulation 12B(5)(b) better describes the type of accommodation each occupied. Given that, the evidence before the tribunal about how charges for personal water use were calculated by M and D’s landlord was not in accordance with the method of calculation permitted by Regulation 12B(5)(b). The tribunal should have calculated those charges in accordance with the Regulation.

 

5.        Second, the tribunal failed to determine the proportion of communal water charges attributable to the use of a communal laundry which was ineligible for HB by reason of sub-paragraph 1(a)(ii) of Schedule 1 of the Housing Benefit Regulations 2006 [“the Regulations”]. Accordingly I remit both cases to the First-tier Tribunal for re-determination in accordance with the principles set out in this decision.

 

6.        Documents are referred to by page number in the appeal bundles. Documents in the first appeal are prefixed “M” and documents in the second appeal are prefixed “D”.

 

Factual Background: The M Case

 

7.        M was a licensee of room 11A in a project called “P”. His licence agreement which began on 9 May 2013 is at M67-81. It includes a schedule of service charges at M79 which lists (a) “water rates” of £2.24 a week as being “eligible for Housing Benefit” and (b) “water rates” of £4.06 a week as being “not eligible for housing benefit”. The sum of £2.24 relates to communal water charges and the sum of £4.06 relates to M’s personal use of water in room 11A. It is not clear whether these calculations are based on a metered water supply.

 

8.        P is a supported housing scheme for 16 to 25 year olds and is owned by RGL [“RGL”]. It consists of one and two bedroom flats. In the two bedroom flats the bedrooms are separately let and the licensees share the bathroom, WC and kitchen in the flat. Outside of the flats, the communal areas include corridors, a laundry, communal kitchen, a lounge, IT suite, meeting rooms, offices, disabled communal toilet and a garden. Water is used in the communal areas for cleaning and in the disabled communal toilet and kitchen, the laundry and the garden.

 

9.        On 16 July 2013 the Appellant disallowed M’s claim for HB in respect of communal water charges. M appealed this decision to the First-tier Tribunal and his appeal was allowed on 6 March 2014. The Statement of Reasons is at M40-42.

 

10.     On application by the Appellant local authority, permission to appeal was given on 2 September 2014 by Upper Tribunal Judge Wikeley.  Given the potential ramifications of this appeal, his case management directions included an invitation to the Secretary of State for Work and Pensions to be joined as a party to the appeal in the Upper Tribunal. On 14 October 2014 the Secretary of State stated that he did want to be joined as a party but by 4 November 2014 he had changed his mind and thus declined the invitation to be joined and withdrew from the appeal.

 

11.     On 26 February 2015 Upper Tribunal Judge Wikeley listed the appeal for an oral hearing in Manchester to be heard together with the appeal in the D case.

 

Factual Background: The D Case

 

12.     D was an assured tenant at “ASC”. His tenancy agreement which began on 22 April 2013 is at D51-72. It includes a schedule of service charges at D72 which lists (a) “water rates” of £5.95 a week as being “eligible for housing benefit” and (b) “water rates” of £3.20 a week as being “not eligible for housing benefit”. The sum of £5.95 relates to communal water charges in ASC and the sum of £3.20 relates to D’s personal use of water in his flat. Again it is unclear whether these calculations are based on a metered water supply.

 

13.     ASC is a sheltered housing scheme for those over 55 and for younger persons with disabilities. It too is owned by RGL. It consists of self-contained flats and communal areas. These include corridors, a laundry, communal kitchen, three lounges, disabled communal bathroom and garden. Water is used in the communal areas for cleaning and in the disabled communal bathroom and kitchen, the laundry and the garden.

 

14.     On 9 December 2013 the Appellant disallowed D’s claim for HB in respect of communal water charges. D appealed to the tribunal and his appeal was allowed on 3 July 2014.  The Statement of Reasons is at D36-38 and is largely the same as in the M case.

 

15.     On application by the Appellant local authority, I gave permission to appeal on 16 December 2014. Like Upper Tribunal Judge Wikeley, I also invited the Secretary of State for Work and Pensions to consider whether he wished to be joined as a party since the outcome of this appeal might be of significance in other cases. On 25 February 2015 the Secretary of State declined my invitation to participate in this appeal. On 30 March 2015 I directed that the D case be heard together with the M case.

 

The Tribunal’s Decision

 

16.     The Appellant’s case before both the tribunals was founded on its belief that all water charges, including communal water charges, were ineligible for housing benefit regardless of whether the property was self-contained. It stated that the effect of Regulation 12B(5) of the Regulations was as follows:

(a)  all service charges payable as a condition of occupying a dwelling are counted as rent for HB purposes unless they are ineligible under Schedule 1 of the Regulations;

(b)  charges relating to personal needs such as water and fuel were generally ineligible;

(c)  service charges for fuel were generally ineligible but were made eligible for communal areas by virtue of paragraph 5 of Schedule 1 of the Regulations;

(d)  and there is no similar provision for water charges which are therefore ineligible.

 

17.     At the hearing relating to D, the Appellant also referred to guidance from the Department for Work and Pensions about Housing and Council Tax Benefit which stated that water charges are ineligible “in all cases” [see D31-32 at paragraph 4.600]. The tribunal was told by the Respondent at the D hearing that, in the past, the Appellant had always paid the service charge (including water charges for communal areas) in sheltered and other community housing. However the Appellant had recently decided that communal water charges were no longer eligible for HB as a service charge [D37].

18.     The tribunal drew a distinction between charges relating to the personal use of water by M and D within their own accommodation units and ruled that these were ineligible for HB. However it found that communal water charges were eligible for HB. This was because, by reference to Regulation 12(1)(e) of the Regulations, communal water charges formed part of the service charge payable by both M and D as a condition of their occupation of the accommodation. It found that without the use of water in the communal areas activities such as cleaning, gardening, laundry, and maintenance could not be carried out [M42; D38].

 

This Appeal

 

19.     These two appeals were originally listed for an oral hearing in Manchester on 13 May 2015. That hearing was unable to proceed for the reasons which are detailed in my ruling dated 20 May 2015. I adjourned both appeals to a date to be fixed.

 

20.     I held a hearing in Manchester on 30 July 2015. The Appellant was represented by Miss Ellis of counsel and the Respondents by Mr Alderson, solicitor. I am very grateful to both parties for their respective skeleton arguments and for the assistance they gave me with their oral submissions.

 

21.     Before I turn to the issues raised by this appeal, I note that the Appellant did not contend that the payment of communal water charges (as part of the service charge) was not “a condition on which the right to occupy the dwelling depends” [see Regulation 12(1)(e) of the Regulations]. It also did not contend that the costs of the communal water charges were excessive.

 

The Preliminary Issue

 

22.     The Appellant raised the nature of the accommodation occupied by the Respondents and their differing legal status as a preliminary issue since this might affect how the amount of communal water charges was eventually to be calculated.

 

23.     Schedule 1 of the Regulations is entitled “Ineligible service charges”. The general rule contained in Regulation 12(1)(e) is that service charges are “rent” for HB purposes and hence eligible to be met by HB under Regulation 11(1). Schedule 1 lists the exceptions to that rule. It also contains a definition of what constitutes “communal areas” in sub-paragraph 8 which states that:

“‘communal areas’ mean areas (other than rooms) of common access (including halls and passageways) and rooms of common use in sheltered accommodation.”

Thus the definition varies depending on whether or not the claimant is in “sheltered accommodation”. If he is, then “communal areas” include rooms of common use. If he is not, then “communal areas” are limited to areas of common access such as halls and passageways.

 

24.     The term “sheltered accommodation” is not defined in the Regulations. In Oxford City Council v Basey [2012] EWCA Civ 115 the Court of Appeal concluded that:

“ 33…Parliament did not choose to define sheltered accommodation and the Court should not impose a prescriptive definition upon an inherently flexible concept which can take many forms, and which now includes very sheltered or extra care sheltered accommodation.

 

34. At one end of a broad spectrum, sheltered accommodation is distinguishable from “ordinary” accommodation because it will incorporate particular features which are not normally found in “ordinary” accommodation and are designed to meet the needs of occupiers who are vulnerable in some way, often by reason of age, and increasingly so by reason of disability. The Appellant’s six “essential common features” are no more than a non-exhaustive list of examples of such features. The presence or absence of a particular feature is not determinative.

 

35. At the other end of the spectrum a care home is not sheltered accommodation. The occupiers of a care home may well need a greater level of care than is available in very sheltered accommodation – see the descriptions of very sheltered housing by Help the Aged and Directgov (paragraphs 20 and 21 above) – but the level of care may well be determined more by personal choice and/or availability, or more probably lack of provision in a particular area. The emphasis in a care home will usually be rather more on care than accommodation, and this will normally be reflected in the basis upon which such accommodation is occupied. Typically the occupiers will occupy their homes under licence. Of particular importance for present purposes – eligibility for housing benefit in respect of service charges for heating, lighting and cleaning common rooms in sheltered accommodation – those having exclusive possession of their own living space within that sheltered accommodation will be in occupation, and will be liable to pay the rent and service charges which are eligible for housing benefit, pursuant to a tenancy.”

 

25.     The Appellant accepted that D was resident in sheltered accommodation but submitted that M, who did not have a tenancy but did have a licence, was resident in what was described by the Respondents as a “supported housing scheme”. Relying on the comments made by the Court of Appeal in paragraph 35 above, the Appellant submitted that this accommodation was not akin to sheltered accommodation because M had a licence to occupy it rather than a tenancy. M was really living in “ordinary” accommodation for those who could manage to live without help and support – as Miss Ellis said, his accommodation was really just a standard hostel. Thus the water charges which M contended should be covered by HB in his case improperly included charges levied in respect of a large number of shared rooms. Those charges, the Appellant said, should be restricted to halls and passageways.

 

26.     Further the Appellant submitted that, though (a) the phrase “supported accommodation” was mentioned in Basey as being accommodation “one rung below care homes” [paragraph 25] and (b) the Court of Appeal appeared to have adopted the submission that the Regulations did “not appear to distinguish between supported and sheltered accommodation. If Parliament had wished to introduce such a distinction it could have done so” [paragraph 26], Parliament did not in fact regard these terms as synonymous since the precursor to the 2006 Regulations – namely the Housing Benefit (General) Regulations 1987(as amended) - featured both terms in paragraph 7 of Schedule 1.  

 

27.     The Respondents invited me to disregard the Appellant’s submission which attempted to draw a distinction between sheltered and supported accommodation as this was based on secondary legislation which was no longer in force. I do so for that very reason.

 

28.     The distinction between M and D which the Appellant seeks to draw based on the legal instrument which governed the occupation of their respective accommodation is not one which I accept. First, it seeks to impose a prescriptive definition on an “inherently flexible concept” in the manner rejected by the Court of Appeal. Second, the decision in Basey drew no distinction between sheltered and supported accommodation.

 

29.     Third, M’s accommodation was distinguishable from “ordinary” accommodation as it incorporated particular features not normally found in “ordinary” accommodation which were designed to meet the needs of vulnerable occupiers such as M. Thus, paragraph 4.10 of M’s licence agreement [M72] required the following of him:

“You will co-operate with us and any other relevant agencies with regard to the provision of any support services to you and you will accept such services. If you do not co-operate or accept such services, you will be in breach of the terms of this agreement and the licence may be terminated”.

Thus, in M’s case, accommodation was provided on the understanding that the licensee accepted support services. That is hardly a feature of “ordinary” housing. In this context I also note that the tribunal found that M’s accommodation was provided by P which was an organisation offering shelter to young vulnerable people, some of whom required training for daily living [M41, paragraph (d)].

 

30.     Finally and for the avoidance of doubt, the accommodation occupied by M was not a care home since it did not provide nursing or personal care as is required by the definition of “care home” within section 3 of the Care Standards Act 2000. I note that Regulation 2(1) of the Regulations defines “care home” in England and Wales as having the meaning assigned to it by section 3 of the Care Standards Act 2000 [see also the comment to similar effect in paragraph 24 of Basey].

 

31.     Thus I reject the Appellants’ argument on this preliminary issue. I accept the Respondent’s submission that the accommodation occupied by both D and M fell within the term “sheltered accommodation” as found in the Regulations and specifically in sub-paragraph 8 of Schedule 1. Thus, if communal water charges are eligible for HB, they encompass water use in halls, passageways and rooms of common use in both D and M’s accommodation.

 

Calculation of Benefit: Stage One

 

32.     Regulation 12B(2) of the Regulations states that the starting point for the calculation of eligible rent is the aggregate of the payments specified in Regulation 12. Regulation 12 lists specific types of periodic payments “in respect of the dwelling which the claimant occupies as his home” including rent, payments in respect of a licence to occupy, and service charges, payment of which is a condition on which the right to occupy depends.

 

33.     In M’s case, he is liable as a licensee to make payments in respect of his licence to occupy and in respect of service charges. In D’s case, he is liable as an assured tenant to make payments of rent and service charges. The service charges which M and D have to pay include water charges for communal areas.

 

34.     There is no dispute about the above.

 

Calculation of Benefit: Stage Two

 

(i) The Regulations

 

35.     Having established the total of the relevant payments under Regulation 12(1), Regulation 12B(2)(a) provides for the deduction of an amount calculated in accordance with Regulation 12B(5) in respect of charges for water, sewerage or allied environmental services except where the occupier is separately liable for such services.

 

36.     The Appellant submitted that separate liability pursuant to Regulation 12B(2)(a) meant a liability separate from the one owed to the landlord, for example a liability to the water company which supplied the property with water and sewage services. That must be correct. In this case both M and D were billed for water charges by their landlords so neither was separately liable for such charges. In their case, I find that Regulation 12B(5) applied.

 

37.     Regulation 12B(5)(a) states that, where a dwelling occupied by the claimant is a self-contained unit, the amount of the charges shall be deducted. The only exception is where the charges vary in accordance with the amount of water actually used. If this is the case, the amount deducted shall be the amount which the appropriate authority considers to be fairly attributable to water and sewage services, having regard to the actual or estimated consumption of the claimant (Regulation 12B(5)(c)).

 

38.     If the accommodation is not self-contained and the charges do not vary in accordance with the amount of water actually used, Regulation 12B(5)(b) applies and states that the amount of the deduction shall be:

“…the proportion of those charges in respect of the self-contained unit which is obtained by dividing the area of the dwelling occupied by the claimant by the area of the self contained unit of which it forms a part”.

“Dwelling” has the meaning given to it by section 137(1) of the Social Security Contributions and Benefits Act 1992, namely “any residential accommodation, whether or not consisting of the whole or part of a building and whether or not comprising separate and self-contained premises”.

 

(ii) The Tribunal’s Decision 

 

39.     In the case of M, the tribunal read Regulation 12B(5)(a) to mean that, where a person was in a self-contained unit, they had to pay their own water charges which were billed to them. The tribunal found that, if there was no separate billing, then the exception in Regulation 12B(5)(c) applied. This exception is that the amount of water either actually or fairly attributable to the use in the actual self-contained unit is payable by the tenant and is not eligible for HB [paragraph (o), Statement of Reasons, M41]. It applied the same reasoning with respect to D [paragraph (o), Statement of Reasons, D37]. In both cases it is clear that the tribunal found that Regulation 12B(5) did not apply to charges for water use in communal areas.

 

(iii) The Parties’ Arguments

 

40.     The Appellant submitted that Regulation 12B(5) referred to all water charges and made no distinction between charges levied in respect of personal consumption and charges levied in respect of communal areas. It contended that the water charges to be deducted under Regulation 12B(5) were any and all water charges for which the claimant was liable. It stated that this point was reinforced by the method of calculation in Regulation 12B(5)(b) which allocated a claimant a proportionate share of water charges for the entirety of the unit of which his dwelling formed a part.

 

41.     Thus in D’s case, his accommodation was self-contained and thus Regulation 12B(5)(a) applied. M did not have self-contained accommodation so Regulation 12B(5)(b) applied. In both cases the Appellant submitted that a correct reading of the Regulations would result in the deduction of all water charges from the eligible rent.

 

42.     In support of its submission, the Appellant relied on the fact that a distinction was drawn in the Regulations between fuel charges for personal consumption and fuel charges levied in respect of communal areas.  Paragraph 5 of Schedule 1 states that fuel charges are ineligible for housing benefit “except a charge in respect of services for communal areas”. The Appellant maintained that, for water charges, no such distinction was present in the Regulations. 

 

43.     By contrast, the Respondents submitted that neither M nor D occupied self-contained accommodation as both had the use of communal areas in addition to their own flat or room, those communal areas also forming part of their accommodation. Regulation 12B(5) was irrelevant as it concerned the apportionment of water charges for personal use (where these were not separately billed). In M and D’s case, water charges for personal use were separately identified as being ineligible for HB and were not included in the rent.  If all water charges for communal areas were ineligible, the Respondent submitted that such charges would be listed as an ineligible service charge in paragraph 1 of Schedule 1 of the Regulations. They are not.

 

(iv) Discussion

 

44.     I have decided in accordance with the Respondents’ submission that Regulation 12B(5) concerns the apportionment of water charges for personal use when the claimant is not separately billed. This regulation has no application to communal water charges. My reasoning is as follows.

 

45.     First, a careful reading of Regulation 12B(5) demonstrates that the charges to be deducted for water use are directly related to the personal consumption of the occupier of a dwelling which is a self-contained unit. Thus it is clear that a person who occupies a self-contained unit pays for his or her own water charges because the water used in such a unit can only be referable to the person occupying it [see Regulation 12B(5)(a)]. Likewise, Regulation 12B(5)(c) - which applies where the charges vary in accordance with the amount of water actually used - relates the charges to the “actual or estimated consumption of the claimant”. This regulation seems to have been designed for situations where a water meter is in use in a building which contains either a number of self-contained units or dwellings.

 

46.     The calculation required by Regulation 12B(5)(b) does not – as the Appellant suggested – encompass both personal and communal water use. If a claimant occupies a dwelling which forms but 25% of the area of a self-contained unit, that person will pay 25% of the water charge payable for that self-contained unit. He or she will not pay any amount for the 20% of communal space which may also exist in such a self-contained unit. The formula in this Regulation – like those in Regulations 12B5(a) and 12B5(c) – encompasses the personal use of water. Had it been intended that a claimant should pay a percentage encompassing both personal and communal water use, Regulation 12B(5)(b) would have been written differently, perhaps to include a formula for apportioning the water charges attributable to communal space by the number of dwellings contained in the self-contained unit. 

 

47.     Second, if all water charges for communal areas were ineligible as the Appellant claims, such charges would be specifically listed as an ineligible service charge in paragraph 1 of Schedule 1 of the Regulations. They are not.

 

48.     Third, the fact that there is no equivalent provision within Schedule 1 relating to water charges as there is for fuel charges does not mean that all water charges are thus ineligible.  The equivalent provision in respect of water charges is Regulation 12B(5) itself which stipulates that charges for personal water use are not eligible for housing benefit.

 

49.     Thus, in these cases, Regulation 12B(5) applied so as to render the charges for personal water use by M and D ineligible for housing benefit. It had no application to the charges for water use in communal areas.

 

50.     On this analysis, no deductions from eligible rent in respect of communal water charges were necessary at this stage. The only permissible deduction at this stage was for charges in respect of personal water use.

 

51.     The tribunal’s reasoning was based on its view that Regulation 12B(5)(c) applied in the case of both M and D. I have expressed the view that this regulation is designed for situations in which water consumption is metered and I am not aware of evidence to that effect in either case. In fact, in both cases, the tribunal found that charges for personal water use were billed to either P or RGL as a whole. The amount was divided by the number of dwellings and the number of occupants in each dwelling, giving a charge for personal water use payable by each of the residents. I note that it is not clear from the tribunal’s reasons how communal water use was charged and calculated.  

 

52.     Though the tribunal came to the correct conclusion that no deductions from eligible rent in respect of communal water charges were necessary at Stage 2, I find that it did so for the wrong reasons and thus was in material error of law. Both M and D lived in a dwelling which formed part of a larger self-contained unit and each had the use of communal areas in addition to their own room or flat which formed part of their accommodation. I find that Regulation 12B(5)(b) is the regulation which best describes the accommodation occupied by both men. It follows that I doubt that the method of calculation permitted by that Regulation had been applied by either P or RGL to the calculation of charges for personal water use by either M or D. It was certainly not applied by the tribunal.

 

53.     It follows that I allow this appeal to the limited extent indicated. When this case is remitted to the tribunal for rehearing, it will be necessary for both P and RGL to provide evidence as to how M and D’s water charges for personal use were calculated.

 

Calculation of Benefit: Stage 3

 

(i) The Regulations

 

54.     In accordance with Regulation 12(2)(b) and Schedule 1 of the Regulations, ineligible service charges must now be deducted from the Stage Two figure to produce the eligible rent.

 

55.     Paragraph 1 of Schedule 1 of the Regulations contains a non-definitive list of ineligible service charges which, amongst other matters, include (i) laundry (other than the provision of premises or equipment to enable a person to do his own laundry); (ii) cleaning other than in communal areas; (iii) personal care including assistance with personal hygiene; and (iv) charges in respect of general counselling or of any other support services. Sub-paragraph 1(g) further provides that charges in respect of any services not specified in sub-paragraphs 1(a) to 1(f) which are unconnected with the provision of adequate accommodation shall not be eligible for HB.

 

(ii) The Tribunal’s Decision

 

56.     In both cases the tribunal found that the water charges “eligible for HB” were service charges which M and D were required to pay by virtue of the conditions under which each occupied their respective accommodation. These water charges related to water use in the communal areas only.

 

57.     The tribunal made no specific reference to the provisions of Schedule 1 in either of its decisions. In M’s case it found that “without the use of water in the communal areas, activities such as cleaning, gardening, laundry maintenance could not be carried out” [paragraph (r), M42]. In D’s case the list of activities which could not be carried out without the use of water in the communal areas included “community entertainment and other activities carried out as a community” [paragraph (t), D38].

 

(iii) The Parties’ Arguments

 

58.     The Appellant contended that communal water charges were ineligible service charges as they were either charges in respect of day to day living expenses within the meaning of sub-paragraph 1(a) or charges which were not connected with the provision of adequate accommodation within the meaning of sub-paragraph 1(g). The tribunal had allowed water use in D’s case relating to community entertainment which did not fall within any of the categories listed in paragraph 1.

 

59.     The Respondents submitted that the provision of water in communal areas was not a distinct service in its own right. It was however a means of both providing and a component cost of other services such as cleaning. They argued that water use for the cleaning of communal areas, for a communal toilet, for a communal kitchen and for the communal garden was eligible. However they conceded that water use for laundry was not eligible save in so far as water was required to clean the laundry area and maintain laundry equipment [see sub-paragraph 1(a)(ii) of Schedule 1].

 

(iv) Discussion

 

60.     In my judgment, communal water charges are not “day to day living expenses” within the meaning of sub-paragraph 1(a) of Schedule 1. As Upper Tribunal Judge Turnbull observed in paragraph 15 of CP & Others v Aylesbury Vale District Council v Secretary of State for Work and Pensions (HB) [2011] UKUT 22 (AAC), paragraph 1(a) goes to considerable trouble specifically to list items which are considered to fall within that description. If communal water charges were intended to be included, I would have expected them to be specifically mentioned. They are not.

 

61.     Are communal water charges “charges connected with the provision of adequate accommodation” within the meaning of paragraph 1(g)?  My starting point is the common sense view set out in paragraph 15 of the Appendix to CIS 1460/1995. This states that:

“…Where an element of a service charge is not specified as either eligible or ineligible in subparagraphs (a) to (f) of paragraph 1 of Schedule 1 to the Housing Benefit Regulations, so that the test in sub-paragraph (g) has to be considered, a common sense view must be taken of the notion of adequate accommodation. In general, where the terms on which the claimant occupies a dwelling include the right to use premises (including gardens, grounds, walkways etc) beyond the dwelling exclusively occupied by the claimant, services related to the adequacy of those premises should be accepted as related to the provision of adequate accommodation…”

 

62.     CIS 1460/1995 held that the question of what is the provision of adequate accommodation, including how far the personal needs of residents should be taken into account, is a matter of fact for the adjudicating authority to determine in the circumstances of each case.

 

63.     Applying that authority, I find that communal water charges are charges related to the provision of adequate accommodation. Without water, cleaning of communal areas would not be possible and a communal kitchen and toilet would not be capable of hygienic use. Laundry equipment could not be cleaned or maintained and a communal garden could not be cared for without water being available. Without water being available, the fabric or condition of the communal areas - which the landlord undertook to provide by reason of either M’s licence or D’s tenancy agreement - is likely to be significantly compromised within a very short space of time.

 

64.     The Appellant suggested that nothing had been identified with regards to the personal needs of M and D which addressed the question of whether the provision of water in communal areas for any/all purposes was significant to the provision for them as individuals of adequate accommodation. I reject this submission. I do not read CIS 1460/1995 as requiring a tribunal to adjudicate upon whether, for example, a particular claimant has the need to use a communal toilet or a communal laundry. Rather I find that what is required is for the tribunal to have regard to the characteristics of residents in general in the type of accommodation under consideration. So in D’s case, these would be those over the age of 55 and younger persons with disabilities. In M’s case, these would be vulnerable young people between the ages of 16 and 25.

 

65.     What of the tribunal’s decisions? The tribunal simply did not refer to Schedule 1 when reaching either of its decisions. That inadequacy of reasoning might not constitute a material error of law if it were not for two factors. First, in the D case, the tribunal found that, amongst other matters, community entertainment necessitated the eligibility of communal water rates for HB. On any analysis of paragraph 1 of Schedule 1, that conclusion is a material error of law which requires the D decision to be set aside.  

 

66.     Second, as the Respondents conceded, the tribunal did not determine the proportion of the communal water charges attributable to laundry use which were ineligible for HB. Sub-paragraph 1(a)(ii) of Schedule 1 states that charges in respect of the provision of laundry – other than the provision of premises or equipment to enable a person to do his own laundry – are ineligible for HB. However the cleaning of communal areas such as a communal laundry is an eligible service charge [see sub-paragraph 1(a)(iv)(aa)]. For my part I do not read sub-paragraph 1(a)(ii) as excluding the cleaning and maintenance of laundry equipment for which water is essential.

 

67.     The Respondents submitted that, in the light of that error of law in the tribunal’s decision making, I should remit both cases to the tribunal so that it might determine the proportion of the communal water charges attributable to laundry use which are ineligible for HB. I agree that this is the proper course in these cricumstances.

 

Conclusions

 

68.     I have found in favour of the Appellant to the limited extent identified in this appeal and allow the appeal in both cases. I remit both cases for re-determination by a differently constituted tribunal in accordance with the principles set out in this decision.

 

 

 

CASE MANAGEMENT DIRECTIONS

 

 

69.     Both cases should be considered at an oral hearing.

 

70.     The new First-tier Tribunal should not involve the tribunal judge who was previously involved in determining these appeals.

 

71.     The Respondents shall provide evidence as to how their respective landlords calculated (a) the charges for their personal use of water in the accommodation and (b) the charges for water use in communal areas. Any such evidence should be sent to the tribunal office within one month of the issue of this decision.

 

72.     If the Respondents have any further written evidence to put before the tribunal, this should be sent to the tribunal office within one month of the issue of this decision.

 

73.     Any further evidence from the Respondents will have to relate to the circumstances as they were at the date of the original decisions by the local authority which are under appeal.

 

74.     The differently constituted tribunal must conduct a complete rehearing of the issues that are raised by this appeal and, subject to the tribunal’s discretion under section 12(8)(a) of the Social Security Act 1998, any other issues that merit consideration.

 

75.     The tribunal must deal with any procedural questions, as may arise, on their merits.

 

76.     The tribunal must consider all aspects of the case, both fact and law, entirely afresh.

 

77.     The tribunal must not take into account any circumstances that were not obtaining at the date of the decision appealed against – see section 12(8)(b) of the 1998 Act – but may take into account evidence that came into existence after the decision was made and evidence of events after the decision was made, insofar as it is relevant to the circumstances obtaining at the date of the decision.

 

 

 

 

 

 

 

 

 

Gwynneth Knowles QC

Judge of the Upper Tribunal

24 September 2015.

 

[signed on the original as dated]