CCR/1895/2003

DECISION OF THE SOCIAL SECURITY COMMISSIONER

1.	The claimant’s appeal is unsuccessful.  I set aside the decision of the Manchester appeal tribunal dated 19 March 2003 but I substitute a decision to the same effect.  I confirm the certificate of recoverable benefits against which the claimant appealed to the tribunal.

REASONS

2.	The claimant suffered an industrial accident on 2 August 1994 when, while working as a roofer, he fell from a roof and fractured his lumbar spine and his left arm.  He was then aged 49 and has not worked since.  On the basis that he was incapable of work, he received statutory sick pay followed by sickness benefit from 22 October 1994, invalidity benefit from 11 February 1995 and incapacity benefit from 13 April 1995.  He also received disablement pension from 16 November 1994, based on consecutive assessments of disablement, all at 35 per cent.  The total amount of the benefits paid by the Secretary of State of Social Security within five years of the accident taking place was £27,771.07.

3.	The claimant sued his employer.  The case went to trial in 2000 but compensation was not actually received by the claimant until 2002.  Damages were assessed at £41,610.90, including £14,360 in respect of loss of earnings, which appears to have been based on a view that the claimant had been incapable of work for only two and a half years after his accident.  I am not sure how the calculation was done, given the figure for weekly earnings in the schedule of special damage in the statement of claim, and I am also not sure to what extent, if any, the amount of special damages had been agreed before trial.  If, as the claimant has suggested, the figure is based on lost earnings less benefits, with interest then being added, the calculation was incorrect.  Benefits should have been ignored (see section 17 of the Social Security (Recovery of Benefits) Act 1997).  The compensator, having obtained a certificate of recoverable benefits in the sum of £27,771.07, deducted a sum of £14,360 from the compensation paid in respect of loss of earnings, so as to reduce it to nil.  This was presumably done on the basis that the deduction represented benefits paid to the claimant and that the compensator was entitled to make the deduction under section 8 of the Social Security (Recovery of Benefits) Act 1997 as a way of recouping part of the £27,771.07 the compensator was obliged to pay to the Secretary of State under section 6 of that Act.  The claimant, who was acting in person – possibly as a result of rejecting legal advice given in the light of a substantial payment in to court which he failed to better at the trial – did not object to the deduction being made.  Therefore, he received only £27,250.90 by way of compensation.

4.	The claimant appealed against the certificate of recoverable benefits on the ground that it was wrong for more than two and a half years’ worth of benefits to be included in the certificate of recoverable benefits when compensation had been paid only in respect of two and a half years’ loss of earnings.  The appeal was dismissed by the tribunal and the claimant now appeals with my leave.

5.	The tribunal regarded the claimant’s appeal as misconceived and his principal ground of appeal to the tribunal was indeed misconceived.  A certificate of recoverable benefits should contain all benefits paid in respect of an accident within the relevant period, which in this case was the period of five years following the accident.  The mere fact that compensation has been paid in respect of a shorter period is not a reason for reducing the amount of a certificate of recoverable benefits.  That is not to say that the claimant did not have a justifiable grievance arising from the fact he had received no compensation for loss of earnings at all, despite the fact that the benefits he had received during the relevant 2½ year period did not fully replace the earnings he had lost.  For reasons I have explained in CCR/427/03, my view is that only benefits paid in respect of the period over which the claimant had lost earnings should have been deducted under section 8.  Furthermore, if as the claimant believes the figure for loss of earnings already took account of benefits, there should have been no further deduction under section 8 at all.  In other words, the principal problem in this case was not with the certificate of recoverable benefits but with the amount of the deduction made by the compensator from the compensation.  That was not an issue over which the tribunal had any jurisdiction.  The claimant should have objected to the amount of the deduction made from the compensation and refused to sign the draft consent order under which part of the money held in court was paid out to him and the balance to the compensator.  

6.	However, there is another issue in this appeal, as there was in CCR/427/03, and it is on that issue that I granted leave to appeal.  The claimant’s case is, of course, that he was disabled as a result of the relevant accident throughout the relevant period and that he was entitled to all the benefits paid to him during the relevant period.  However, it is not necessarily inconsistent with that case to argue that not all the benefits were paid in respect of the relevant accident.  In his grounds of appeal to the tribunal, the claimant said:

“In court, the judge said I would not be able to work past the 2½ years (Feb 1997).”

As that was said in the light of an award of compensation for loss of earnings covering only a period of two and a half years, the implication is that the court took the view that, from February 1997, the claimant was incapable of work due to some cause other than the relevant accident.  If that is so even if “incapable of work” is given the technical meaning required by Part XIIA of the Social Security Contributions and Benefits Act 1992, incapacity benefit paid from February 1997 was paid to the claimant otherwise in respect of the relevant accident and should not be included in the certificate of recoverable benefits.

7.	The tribunal did not consider this issue.  This is not surprising, because it was not expressly raised by the claimant who did not attend, and was not represented at, the hearing before the tribunal, but in my view the tribunal ought nonetheless to have considered it in the light of the evidence in the case.  There was clear evidence of disablement that affected the claimant but was not due to the relevant accident, because he suffered from the effects of a road traffic accident that had resulted in a fractured femur and residual shortening of one leg, from the effects of degeneration of the cervical spine and from the effects of renal stones and an enlarged prostate.  Furthermore, Mr John Hodgkinson, a consultant orthopaedic surgeon, had expressed the view on 4 April 2000 that it was unlikely that the claimant would have continued working for more than two or three years “even in the absence of the relevant injury”.  That was because the degeneration of the cervical spine was causing more problems, which is a view supported by the decision of a medical appeal tribunal on 23 February 1996, who noted that symptoms from that degeneration, in the form of restricted neck movements, had commenced only some thirteen months after the relevant accident, which is why they considered the problem to be unrelated to that accident.  It seems reasonable to presume that the court’s assessment of loss of earnings was based on Mr Hodgkinson’s view.  The tribunal’s failure to consider the significance of that evidence renders their decision erroneous in point of law, as the Secretary of State concedes.  I must set aside the tribunal’s decision .

8.	I can substitute my own decision.  The claimant did not attend the hearing before the tribunal and has not asked for a hearing before me and I am satisfied that I can properly determine this case without an oral hearing either before me or before another tribunal.  The question that arises is not quite the same as that before the court but, for reasons I gave in R(CR) 3/03, is similar:  would the claimant have been entitled to incapacity benefit from February 1997 even if the relevant accident had not occurred ?  I am bound by section 12(3) of the 1997 Act to take into account the decision of the court but that does not mean that nothing else need be considered, which is what the Secretary of State originally submitted.  Apart from the facts that the precise reasons lying behind the assessment of damages for loss of earnings are not entirely clear and that there is no copy of the judgement of the court, as opposed to the order, before me, consideration must be given to the different ways in which ordinary courts on one hand and tribunals concerned with social security adjudication on the other hand approach the question of incapacity for work.  

9.	The claimant’s entitlement to incapacity benefit depended on him satisfying what was then known as the “all work test” and is now known as a personal capability assessment.  The “all work test” was the means of determining for benefit purposes whether the claimant was incapable of work.  A medical examination in connection with his claim was carried out on 7 May 1997.  He scored 55 points, as against the 15 required to satisfy the “all work test” (see regulations 24 to 26 of, and Schedule 1 to, the Social Security (Incapacity for Work) (General) Regulations 1995).  The question is whether he would have scored at least 15 points had he not suffered the relevant accident.  That is not a question addressed by the Secretary of State in his submissions on this appeal.

10.	Looking at the matters recorded by the examining medical officer as having been taken into account by him in assessing the claimant’s ability to carry out the relevant activities, he was mostly concerned with the effects of the injuries to the lumbar spine and left arm, caused by the relevant accident.  While, dizziness on moving his head and tenderness over his cervical spine, with restricted and painful movement, were noted as relevant to activities in respect of which points were scored, such description of the claimant’s problems from those sources as there is in the papers before me suggest that they are unlikely to have led him to score any significant number of points.  In particular, it is noteworthy that he scored no points in respect of reaching and that the six points scored in respect of lifting and carrying and the further six points in respect of manual dexterity seem to have been attributable to the continuing effects of the fractured left arm rather than problems with the cervical spine.  It also seems improbable that the problems with his cervical spine were a substantial contributory factor in the scoring of points in respect of sitting, rising from sitting, bending or kneeling, standing, walking or walking up or down stairs, where the injury to the lumbar spine is likely to have been a much more important factor.  There is no evidence upon which I could properly find that the claimant would have scored as much as 15 points in the absence of the injury to the lumbar spine.  Nor is there any evidence that the degeneration of the cervical spine led to much more serious disablement before August 1999.  Accordingly, I am not satisfied that the claimant would have been paid incapacity benefit during the relevant period had the relevant accident not occurred.

11.	I am quite satisfied that incapacity benefit was properly paid to the claimant.  He was seriously disabled as a result of the relevant accident and that disablement did not lessen substantially after February 1997.  For the same reason, I am quite satisfied that the disablement pension was properly paid to the claimant.  There is not a shred of evidence to suggest that the assessment was too high or for too long a period or that the disablement was wrongly attributed to the relevant accident, given that the medical appeal tribunal specifically excluded the effects of the degeneration of the cervical spine.  The benefits paid after February 1997 were therefore properly included in the certificate of recoverable benefits.

12.	This decision is not inconsistent with the decision of the court, as the Secretary of State has submitted it would be.  I do not doubt that the degeneration of the cervical spine did create significant disablement and that the claimant would have become incapable of work as a roofer or in any other heavy manual work as a consequence of that disablement by about February 1997 even if he had not suffered the relevant accident.  The discomfort from the cervical degeneration would have made it difficult for him to perform even light work and, given his age and lack of qualifications, it may well be the case that he would, for practical purposes, have been unemployable.  On that basis, the court was plainly right to limit the compensator’s liability for damages for loss of earnings.  However, the “all work test” tests employability only by the capacity to perform certain physical activities and therefore matters such as age, education and experience are not taken into account.  A person may in practice be very unlikely to find employment but still be obliged to claim jobseeker’s allowance rather than incapacity benefit.  Furthermore, he may be entitled to disablement pension whether he is incapable of work or not.  It seems fairly clear that the court did not limit the award of damages for loss of earnings because the judge concluded that the relevant accident would have ceased to have had any effect in terms of disablement, which is what the Secretary of State seems to understand him to have done, but only because he concluded that the claimant would have become incapable of work due to constitutional disablement even if the relevant accident had not occurred.

13.	As I have said, the claimant has a legitimate grievance, but the grievance is over the amount of deduction made from his compensation by the compensator in the light of the certificate of recoverable benefits, rather than over the certificate itself.  By sections 11 to 13 of the 1997 Act, tribunals and Commissioners have jurisdiction in relation to the certificate but they have no jurisdiction over the amount of compensation to be paid by a compensator to a claimant or over the amount of deduction that may be made from the compensation.  Those issues fall solely within the jurisdiction of the court.  The claimant may wish to seek legal advice as to whether there is any course of action he can now take to secure a further payment of compensation to satisfy fully the judgement of the court.

	(Signed)	MARK ROWLAND
		Commissioner
		2 January 2004