RC-v-Department for Social Development (IS) [2010] NICom 71

Decision No:  C9/10-11(IS)

SOCIAL SECURITY ADMINISTRATION (NORTHERN IRELAND) ACT 1992

SOCIAL SECURITY (NORTHERN IRELAND) ORDER 1998

INCOME SUPPORT

Application by the claimant for leave to appeal
and appeal to a Social Security Commissioner
on a question of law from a Tribunal’s decision
dated 24 November 2008

DECISION OF THE SOCIAL SECURITY COMMISSIONER

1.	Having considered the circumstances of the case, I am satisfied that the application can properly be determined without a hearing.

2.	I grant leave to appeal and proceed to determine all questions arising thereon as though they arose on appeal.

3.	The decision of the appeal tribunal dated 24 November 2008 is in error of law.  The error of law identified will be explained in more detail below.

4.	Pursuant to the powers conferred on me by Article 15(8) of the Social Security (Northern Ireland) Order 1998, I set aside the decision appealed against.

5.	For further reasons set out below, I am unable to exercise the power conferred on me by Article 15(8)(a) of the Social Security (Northern Ireland) Order 1998 to give the decision which the appeal tribunal should have given.  This is because there is detailed evidence relevant to the issues arising in the appeal to which I have not had access, and there may be further findings of fact which require to be made.  Further I do not consider it expedient to make such findings, at this stage of the proceedings.  Accordingly, I refer the case to a differently constituted appeal tribunal for re-determination.

6.	In referring the case to a differently constituted appeal tribunal for re-determination, I direct that the appeal tribunal takes into account the guidance set out below.

7.	It is imperative that the appellant notes that while the decision of the appeal tribunal has been set aside, the issue of whether there has been an overpayment of income support (IS), and whether any overpayment is recoverable from her remains to be determined by another appeal tribunal.  In accordance with the guidance set out below, the newly constituted appeal tribunal will be undertaking its own determination of the legal and factual issues which arise in the appeal.

Background

8.	On 11 February 2008 a decision-maker of the Department decided that an overpayment of IS amounting to £840.00 had occurred for the period from 1 September 2006 to 25 January 2007 which was recoverable from the applicant.  This decision was a revision of an earlier decision of the Department and, indeed, there had been earlier decisions going back to April 2007.  As the appellant had appealed against one of those earlier decisions, and as the revised decision on 11 February 2008 was no more advantageous to her, the appeal continued against the decision dated 11 February 2008.

9.	An appeal tribunal hearing took place on 16 June 2008.  The appellant was present and was represented.  The appeal was adjourned for the Department to prepare an additional submission.

10.	A further very detailed submission was received in the Appeals Service (TAS) before the substantive appeal tribunal hearing.  The substantive appeal tribunal hearing took place on 24 November 2008.  The applicant was present and was represented.  The Department was represented.  The appeal tribunal disallowed the appeal, and confirmed the decision dated 11 February 2008.

11.	On 24 April 2009 an application for leave to appeal to the Social Security Commissioner was received in TAS.  On 5 May 2009, the application for leave to appeal was refused by the legally qualified panel member (LQPM).

Proceedings before the Social Security Commissioner

12.	On 27 May 2009, a further application for leave to appeal to the Social Security Commissioner was received in the Office of the Social Security Commissioners and Child Support Commissioners.

13.	On 19 August 2009 observations were sought from Decision Making Services (DMS) and these were received on 18 September 2009.  DMS opposed the application on the grounds cited in the application.  Observations were shared with the appellant and her representative on 28 September 2009.

14.	On 18 January 2010 DMS were directed to provide observations on the specific issue as to whether the statement of reasons for the appeal tribunal’s decision dealt adequately with the substantive issue arising in the appeal, namely whether there was an overpayment of the relevant social security benefit which was recoverable from the appellant.  On 28 January 2010 a further submission was received from DMS which was shared with the appellant and her representative on 16 March 2010.

Errors of law

15.	A decision of an appeal tribunal may only be set aside by a Social Security Commissioner on the basis that it is in error of law.

16.	In R(I) 2/06 and CSDLA/500/2007, Tribunals of Commissioners in Great Britain have referred to the judgment of the Court of Appeal for England and Wales in R(Iran) v Secretary of State for the Home Department ([2005] EWCA Civ 982), outlining examples of commonly encountered errors of law in terms that can apply equally to appellate legal tribunals.  As set out at paragraph 30 of R(I) 2/06 these are:

“(i)	making perverse or irrational findings on a matter or matters that were material to the outcome (‘material matters’);

(ii)	failing to give reasons or any adequate reasons for findings on material matters;

(iii)	failing to take into account and/or resolve conflicts of fact or opinion on material matters;

(iv)	giving weight to immaterial matters;

(v)	making a material misdirection of law on any material matter;

(vi)	committing or permitting a procedural or other irregularity capable of making a material difference to the outcome or the fairness of proceedings; …

Each of these grounds for detecting any error of law contains the word ‘material’ (or ‘immaterial’).  Errors of law of which it can be said that they would have made no difference to the outcome do not matter.”

Was the decision of the appeal tribunal in the instant case in error of law?

Failure to disclose

17.	I have indicated in a number of decisions that there is in place a legislative mechanism for the recovery of all social security benefits which have been overpaid.  Section 69(1) of the Social Security Administration (Northern Ireland) Act 1992, as amended provides that:

“(1)	where it is determined that, whether fraudulently or otherwise, any person has misrepresented, or failed to disclose, any material fact and in consequence of the misrepresentation or failure –

	(a) a payment has been made in respect of a benefit to which the section applies;

	(b) any sum recoverable by or on behalf of the Department in connection with any such payment has not been recovered,

	the Department shall be entitled to recover the amount of any payment which the Department would not have made or any sum which the Department would have received but for the misrepresentation or failure to disclose.”

18.	In B v Secretary of State for Work & Pensions (reported as R(IS)9/06), the Court of Appeal for England & Wales upheld the decision of the Tribunal of Commissioners in Great Britain in R(IS)9/06.  In that latter decision, the Tribunal of Commissioners had considered, in depth, the nature of the legal test in respect of failure to disclose, by analysing the relationship between section 71 of the Social Security Administration Act 1992 (the Great Britain equivalent to section 69 of the Social Security Administration (Northern Ireland) Act 1992) and regulation 32 of the Social Security (Claims and Payments) Regulations 1987 (which has an equivalence in regulation 32 of the Social Security (Claims and Payments) Regulations (Northern Ireland) 1987).

19.	In summary, the Tribunal of Commissioners found that:

“1.	Section 71 does not purport to impose a duty to disclose, but rather presupposes such a duty, the actual duty in this case being in regulation 32 of the Social Security (Claims and Payments) Regulations 1987, which provides for (a) a duty to furnish information and evidence pursuant to a request from the Secretary of State, and (b) a duty to notify the Secretary of State of any change of circumstance which the claimant might reasonably be expected to know might affect the right to benefit.

2.	In relation to the duty to furnish information and evidence pursuant to a request, whilst there is no duty to disclose that which one does not know, if a claimant was aware of a matter which he was required to disclose, there was a breach of that duty even if, because of mental incapacity, he was unaware of the materiality or relevance of the matter to his entitlement to benefit, and did not understand an unambiguous request for information, and a failure to respond to such a request triggered an entitlement to recovery under section 71 of any resulting overpayment.

3.	Insofar as R(SB) 21/82 imported words from regulation 32 into the construction of section 71 in stating that the non-disclosure must have occurred in circumstances in which, at lowest, disclosure by the person in question was reasonably to be expected, that decision and subsequent decisions that have relied on it were wrongly decided.

4.	The form INF4 supplied to claimants contained an unambiguous request by the Secretary of State to be informed if a claimant’s children went into care and by not disclosing the fact to the Department, the claimant was in breach of her obligation under regulation 32, so that the Secretary of State was entitled under section 71 to recover the overpayment resulting.”

20.	In C6/08-09(IB), I said the following, at paragraphs 40 to 42:

‘40.	Firstly, as was noted above, the practical outcome of the cases referred to above is that an appeal tribunal, when determining whether an overpayment of a social security benefit is recoverable on the basis of a failure to disclose, will have to consider where the requirement to provide the relevant information came from.  This will necessitate identifying whether the case comes within the first or second duty in regulation 32.

41.	In the case of the first duty, it will also require the provision of proof by the Department that the requirement to provide information was made to the claimant.  That proof may be in the form of receipt of an information leaflet such as Form INF4 or instructions in an order book.  It will not be enough, however, for the information leaflet or order book to be produced.  The wording of the relevant instructions will have to be looked at in close detail to ensure that the instructions to disclose were clear and unambiguous.

42.	In the case of the second duty, the requirement is that the change of circumstances is which the claimant might reasonably be expected to know would affect his entitlement to benefit.’

21.	In the instant case, the general appeal submission is drafted in a standard template format which the Department has been utilising for overpayment appeals for some time.  In my view, that format requires revising to take into account the significant developments which have taken place, at Social Security Commissioner, Upper Tribunal and appellate court level, in connection with the scope of the ‘failure to disclose’ test, as set out in section 69 of the Social Security Administration (Northern Ireland) Act 1992, and the equivalent section 71 of the Social Security Administration Act 1992.  Some of the relevant case-law has been set out above.  Other important cases include Hinchy v Secretary of State for Work & Pensions ([2005] UKHL 16) and Hooper v Secretary of State for Work & Pensions ([2007] EWCA Civ 495).  All of those decisions set out important principles with respect to ‘failure to disclose’, identify relevant issues associated with the legislative test, and impose requirements on adjudicating authorities including decision-makers of the Department and appeal tribunals.  It is essential that appeal submissions reflect the currency of the legal developments with respect to particular issues arising in the appeal.  In this respect, the current standard template utilised for overpayment appeals requires to be amended.

22.	In the appeal submission, prepared for the oral hearing of the appeal, the appeals writer has noted the following, at paragraph 16:

	‘(a)	A supersession decision was correctly carried out on 24/01/07 to reduce entitlement to Income Support with effect from 01/09/06 due to a relevant change of circumstances namely (the claimant’s) son had commenced a course and was in receipt of £40 each week.

	(b)	(The claimant) was aware that her son (…) was in training and in receipt of £40 each week training allowance.

	(c)	(The claimant) was issued with forms INF4 on 15/01/04, 13/01/05 and 12/01/06 which advise her to notify the Income Support section if anyone you are claiming for “starts a training scheme, gets money from somewhere else.”  She was advised by an officer of the department during a review visit on 11/04/06 that she must report all changes in her circumstances and signed review form A2 on 11/04/06 stating she would contact the office of there were any changes in (…) circumstances.

	(d)	There is no evidence in the case papers prior to 24/01/07 that (the claimant) informed the Income Support section that (…) was in training.

	(e)	An overpayment amounting to £840.00 in respect of the period 01/09/06 to 25/01/07 has occurred as a result of (the claimant’s) failure to disclose the material fact that (…) was in training and in receipt of a training allowance and as a result the sum is recoverable from (the claimant).

	There then follows a further paragraph 16, as follows:

	‘It is my contention that (the claimant) was aware of the material fact that her son (…) commenced training on 04/09/06 and was in receipt of a training allowance.  I submit that (the claimant) was under a legal duty to notify the Jobs and Benefits Office that (…) was in training in the manner and at the time the Department has told her to do so.  (The claimant) was made aware on form INF4 and A2 of the need to inform her Jobs and Benefits Office of her change in circumstances.  She was specifically advised on form INF4 to inform her Jobs and Benefits Office straight away if someone she is claiming for starts a training course or gets money from somewhere else, she failed to do so until 24/01/07.’

23.	In the decision notice for the appeal tribunal’s decision, the LQPM has recorded that:

	‘Appeal disallowed.  The decision dated 11.2.08 must be upheld.  Income Support was paid to (the claimant) from 01.09.06 to 25.01.07 which would not have been paid but for failure to disclose and accordingly £840 is recoverable from (the claimant).’

24.	The statement of reasons for the appeal tribunal’s decision makes no other reference to the legal and evidential source of the duty on the appellant to disclose a change of circumstances.  Rather it is taken up with an analysis, albeit a detailed and careful analysis, of why the technical legal submission which had been made by the appellant’s representative was rejected.  It is important to note that the appeal tribunal was obliged to consider that legal submission and was obliged to indicate, in the statement of reasons what it made of that submission.  This the appeal tribunal did with care and attention.

25.	The appeal tribunal was also obliged, however, to decide whether the decision of the Department, dated 11 February 2008, and in which it was decided that an overpayment of IS amounting to £840.00 had occurred for the period from 1 September 2006 to 25 January 2007 and which was recoverable from the applicant, was correct.  As set out above, that required:

	(i)	the identification of whether the requirements in section 69(5A) of the Social Security Administration (Northern Ireland) Act 1992 had been met in that there could be no recoverable overpayment of social security benefit, unless the original decision which gave rise to the award of benefit, now deemed to have been overpaid, had been revised or superseded; and

	(ii)	the confirmation of the legal and evidential basis on which it had been decided that there was an overpayment of social security benefit recoverable from the appellant.

26.	In the instant case, the appeal tribunal failed to address the legal and evidential source of the duty on either the appellant or claimant to disclose a material fact.  In the further written observations on the specific question which was sent out to DMS, in connection with the adequacy of the appeal tribunal’s statement of reasons, DMS submitted that looking as a whole at the record of proceedings for the appeal tribunal hearing, the statement of reasons and the decision notice, it is clear that the appeal tribunal had in mind the requirements of section 69 of the Social Security Administration (Northern Ireland) Act 1992.  It is clear that during the oral hearing of the appeal, the LQPM indicated that he wished to address the section 69(5A) decision and the decision notice does confirm the decision of the Department.  It is my view, however, that the appellant was entitled to know, through the statement of reasons for the appeal tribunal’s decision, the legal and evidential basis on which it was confirmed that there had been an overpayment of IS which was recoverable from her.

27.	The failure to address the legal and evidential source of the duty on either the appellant or claimant to disclose a change of circumstances by the appeal tribunal renders its decision on that aspect of the appeal erroneous in law and it must, accordingly, be set aside.

Disposal

28.	The decision of the appeal tribunal dated 24 November 2008 is in error of law.  Pursuant to the powers conferred on me by Article 15(8) of the Social Security (Northern Ireland) Order 1998, I set aside the decision appealed against.

29.	For further reasons set out below, I am unable to exercise the power conferred on me by Article 15(8)(a) of the Social Security (Northern Ireland) Order 1998 to give the decision which the appeal tribunal should have given.  This is because there is detailed evidence relevant to the issues arising in the appeal to which I have not had access, and there may be further findings of fact which require to be made.  Further I do not consider it expedient to make such findings, at this stage of the proceedings.  Accordingly, I refer the case to a differently constituted appeal tribunal for re-determination.

30.	I direct that the parties to the proceedings and the newly constituted appeal tribunal take into account the following:

	(i)	the decision under appeal is a decision of the Department, dated 11 February 2008 in which a decision-maker of the Department decided that an overpayment of IS amounting to £840.00 had occurred for the period from 1 September 2006 to 25 January 2007 which was recoverable from the applicant;

	(ii)	it will be for both parties to the proceedings to make submissions, and adduce evidence in support of those submissions, on all of the issues relevant to the appeal; and 

	(iii)	it will be for the appeal tribunal to consider the submissions made by the parties to the proceedings on these issues, and any evidence adduced in support of them, and then to make its determination, in light of all that is before it.

(signed):  K Mullan

Commissioner

6 August 2010