[2006] UKSSCSC CIS_2559_2005 (12 May 2006)

DECISION OF A TRIBUNAL OF SOCIAL SECURITY COMMISSIONERS

Representation:

Mr Dan Kolinsky of Counsel for the claimant

Mr Jason Coppel of Counsel for the Secretary of State

1.	Our decision is that the decision of the tribunal given on 7 June 2005 is erroneous upon a point of law.  We set it aside.  We make the decision the tribunal ought to have made.  It is that in respect of her claim for income support the claimant is a person from abroad and that her applicable amount is nil.

2.	This is an appeal by the claimant, with the leave of the Chairman, from the decision of an appeal tribunal dated 7 June 2005.  As the Chief Commissioner considered that this appeal and the appeals CIS/3573/2005, CPC/2920/2005, CIS/2680/2005 and CH/2484/2005 involved a question of law of special difficulty, he directed that the appeal be dealt with by a Tribunal of Commissioners, in accordance with the provisions of section 16(7) of the Social Security Act 1998.  The Tribunal of Commissioners held oral hearings on 12 and 13 January, and 23 and 24 February 2006 in relation to the other appeals.  The hearing in the present case was held on 29 March 2006.

3.	The claimant is a Dutch national, though born in Somalia.  She arrived, with her three children and pregnant with a fourth, in the United Kingdom from the Netherlands on 11 August 2004.  She had no savings or income and had never worked in the United Kingdom. She claimed income support (IS) as a lone parent on 10 October 2004.  The claimant was refused her claim on 10 November 2004 as she had no right to reside in the United Kingdom and therefore her applicable amount of IS was nil.  The claimant appealed against the decision on 1 December 2004.  The original decision was reconsidered on 19 February 2005, taking into account the letter of appeal, but the decision itself was not changed.   The appeal tribunal disallowed the claimant’s appeal on 7 June 2005.

4.	The tribunal made the following statement of material facts and reasons for its decision: 

“1.	This statement is produced at the discretion of the Tribunal Chairman following an oral hearing of [the claimant’s] appeal.  [The claimant] gave evidence through a Somali interpreter but the question before the Tribunal revolved not so much around here factual situation as interpretation of the legislation on “right to reside”.

2.	[The claimant’s] representative, Mrs Fernyhough, produced a written submission which set out most of the points she wished to make.  The factual background is that [the claimant] is a Dutch national of Somali origin who arrived in the United Kingdom for the first time on 11th August 2004 and claimed Income Support as a lone parent on 10th October 2004, just over 2 months after her arrival on 10th November 2004, 3 months to the day from her arrival in the U.K., a decision was given that she had no right to resided in the U.K. and therefore her applicable amount of Income Support was nil.

3.	The case as presented on her behalf so far as it related to her personal circumstances was that she had come to the United Kingdom to join relatives because she was lonely following the breakdown of her marriage in the Netherlands.  However [the claimant’s] direct evidence did not confirm this, simply saying that because so many of her relatives had come to the U.K. she had decided to follow them and here husband had declined to do so.

4.	Mrs Fernyhough wanted to concentrate on what was meant by “treated as habitually resident” as well as what was meant by “right to reside”.  She also wanted to consider issues of EU law and under the ECHR.

5.	Mrs Fernyhough considered it was arguable that the wording of the legislation meant that it was still necessary to consider whether [the claimant] was actually habitually resident either on the date of claim or by the date of decision.  In support of this she cited CIS/4474/2003 where Commissioner Jacobs said that in the normal run of the cases a period of between 1 and 3 months would be sufficient to fulfil the appreciable period test.

6.	I note that in the case actually before the Commissioner in CIS/4474/2003 the claimant was a returning former resident of the U.K., not someone who had never previously even visited the country, which is [the claimant’s] position.  I note that decisions on whether a person is actually habitually resident depend very much on the facts of the case and that though the legislature could have provided for a minimum period to be satisfied it has not done so.  That must mean, in my view, that attempts to construct some sort of tariff after which the condition would normally be satisfied is not consistent with the legislative intention.  This has clearly been to create a degree of flexibility which can reflect the diversity of circumstances of individual claimants.  Where Parliament has considered the question of the minimum period, as it has e.g. in the Matrimonial Causes Act 1973 and other legislation relating to family law, it has inserted a minimum period, which in the case of the Matrimonial Proceedings Act is 12 months habitual residence to create jurisdiction for a person not domiciled in England and Wales.  Clearly this is very inflexible.

7.	In [the claimant’s] circumstances, where she entered the U.K. with her 3 children, pregnant with a 4th child, never having visited this country previously and without any established accommodation, I cannot accept that she has become habitually resident within a 3 month period.  She might equally well have decided to return to the Netherlands.  The relatives who she had followed to the U.K. had themselves been here only a very short time which is why, she said, she herself had not previously visited the U.K.  The fact that she is still here some 7 months after the date of the decision might suggest that she plainly did intend to remain and become normally habitually resident.  However the habitual residence test is a question of fact, and it relates to a person’s circumstances as they are at the date of claim and decision, and not simply their future intentions which might indeed be very difficult to ascertain as at the date of claim or date of decision.

8.	Accordingly, although I do not believe it is any longer the relevant test, for the sake of completeness I have decided the question of whether, regardless of the changes in the legislation, if the question before me was actual habitual residence, I would have decided this against [the claimant] for the reasons set out above.

9.	The reason the argument has been raised in this way is that the amendments to Regulation 21 Income Support (General) Regulations (and amendments to the conditions of entitlement of various other benefits as well) made by the Social Security (Habitual Residence) Amendments Regulations 2004 provide (in so far as Income Support is concerned) in paragraph 3G:

	In paragraph (3) for the purposes of the definition of a person from abroad no person shall be treated as habitually resident in the United Kingdom … if he does not have the right to reside in the United Kingdom …

10.	The first point made by Mrs Fernyhough is that in using the expression “no person shall be treated as habitually resident in the United Kingdom” it was only the deeming provisions of the old habitual residence test which were affected, and arguably left unchanged the actually habitually resident test.  She argued that “deemed” is a term of art, it is widely used in various legislative provisions and in this case the deeming provisions were clearly set out in the preceding legislation and if Parliament had intended to change the provisions concerning whether a person was actually habitually resident, it would have said so.  I was unable to accept this argument, primarily because the amendment would be otiose if it did indeed have this affect.  The legislation as amended clearly preserves the position of those who were deemed habitually resident under the old test, i.e. workers exercising their right to export their labour within the EU, and it also protects to a more limited extent workers from the accession state.  It is true that it gives them a more limited protection, but that is well within the terms of the derogation allowed under EU law, and in my view it is most unlikely ever to be successfully challenged to the European Court of Justice, simply because it is so much more generous than the provisions made by the majority of EU states.  The right of states to derogate for a limited period in this way has been well recognised in EU law over many decades.

11.	The remaining argument related to “right to reside”.  As is widely recognised, there is no statutory definition of what amounts to a right to reside.  The right to reside is based on entitlement.  [The claimant] has a right to enter the U.K. as an EU national, but this is not the same as a right to reside.  However the requirements as to a right to reside apply to all claimants, not just accession states or non EU nationals.  Transitional provisions protect the position of claimants already entitled to any relevant benefit on 30th April 2004, the last date before the right to reside amendments came into force on 1st May 2004 and this protection continues for as long as a claimant is in receipt of one of these benefits – i.e. any of the means tested benefits plus Child Benefit.  In this case [the claimant] is not in receipt of any of those benefits, precisely because she has been held not to have the right to reside.

12.	Mrs Fernyhough correctly makes the point that there is no statutory definition of who has the right to reside.  However that cannot mean (nor did she argue this) that this creates a lacuna that can be filled in the judicial decision making process.  Insofar as is possible to list the categories as those with right to reside, it is clear that [the claimant] is not within them.  She is not one of the following, which constitute the main categories:

•	UK national or other person with a right of abode;
•	National of the Irish Republic, Channel Islands, Isle of Man;
•	National with a right to stay in the U.K. with leave to enter or remain under certain provisions of the Immigration Act 1971;
•	EEA National who is economically active” (worker within article 39 as interpreted by regulation 1612/68 or directive 68/360), self employed or economically independent, student with funding or other “qualified person” within regulation 5 of the Immigration (European Economic Area) Regulations 2000;
•	Family member of a “qualified person” or a family member of a deceased “qualified person”;
•	EEA National who was a work seeker for 6 months and a reasonable time thereafter if genuine chance of engagement;
•	Accession state worker whilst working for an authorised employer;
•	Accession state worker who has worked for 12 months up to or including 30th April 2004;
•	Accession state self employed person;

13.	Mrs Fernyhough argues that the new provisions are discriminatory on grounds of nationality in terms of article 14 ECHR.  Article 14 is not freestanding:  it is not engaged until the claimant has brought herself within some other provision of the ECHR.  In this respect, property rights for the purposes of Article 1 of the first protocol have consistently been held by the Court of Human Rights not to include means tested benefits, and therefore I did not find this provision assisted [the claimant].

14.	Mrs Fernyhough argued that Parliament cannot have intended to leave unprovided for persons falling outside the definition of “qualified person”.  For example [the claimant] was pregnant and the mother of 3 young children and unable to work.  There is also the problem of a person who because of incapacity would never to able to work.  Someone in [the claimant’s] situation could, if given appropriate child care, presumably at some point be able to engage in work and thereby become a qualified person but she argued that there must be a question mark over the vires of a statutory provision which failed to make any provision for such vulnerable persons and argued that this could not have been Parliament’s intention.

15.	It appears to me that the reason for changing from the habitual residence test to the right to reside test was precisely to limit entitlement to benefits and therefore I was not able to accept this argument.  The European Court has consistently held that states do have the right to establish rules which limit entitlement to benefit and the exportability of benefit, and therefore I could not see either that the law is in any sense irrational or that it breached any provision of either domestic or European Law.

16.	For the reasons set out above, the appeal failed.”

5.	The hearing in the present case was held on 29 March 2006.  The claimant was represented by Mr Dan Kolinsky, of Counsel, instructed by the Solicitor to the Birmingham Tribunal Unit while the Secretary of State was represented by Mr Jason Coppel, of Counsel, instructed by the Office of the Solicitor for the Department for Work and Pensions.

6.	The relevant domestic legislation is to the following effect.  Section 124(1) of the Social Security Contributions and Benefits Act 1992 provides that a person in Great Britain is entitled to income support if “(b) he has no income or his income does not exceed the applicable amount”.  Regulation 21(1) and paragraph 17 of Schedule 7 of the Income Support (General) Regulations 1987 (SI 1987/1967) make it clear that the applicable amount of IS for a claimant who is “a person from abroad” is “nil”.  

7.	However, in order to find out whether a person is “a person from abroad” it is necessary to have regard to the definition of “person from abroad” set out in regulation 21(3) of the Regulations.  The relevant part of regulation 21(3) is in the following terms:

	“(3)  Subject to paragraphs (3F) and (3G) in Schedule 7 …

“person from abroad” … means a claimant who is not habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland, but for this purpose, no claimant shall be treated as not habitually resident in the United Kingdom who is –
	…”

[The regulation continues by setting out circumstances which do not apply to the instant case.]

8.	However, the definition of “person from abroad” is specifically subject to paragraph (3G), which is an amendment inserted by SI 2004/1232, regulation 3(c), with effect from 1 May 2004.  Regulation 21(3G) is in the following terms:

“(3G)  In paragraph (3), for the purposes of the definition of a person from abroad no person shall be treated as habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland if he does not have a right to reside in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland.”

The references in the legislation to the Channel Islands, etc, are not relevant to the present case.  Accordingly we have to consider whether the claimant was or was not habitually resident in the United Kingdom and also the related issue of whether the claimant has a right to reside in the United Kingdom.

9.	The reason for this change of heart is that the Government took the view that “the habitual test” by itself was not sufficient to stem the tide of persons wishing to come to the United Kingdom, not for the purposes of work, but to live off benefits and that problem not only applied to the existing countries within the EU but, more particularly, to persons from the ten countries which acceded to the union on 1 May 2004.  The reasons can be found in the Statement by the Secretary of State in accordance with section 174(2) of the Social Security Administration Act 1992 – see paragraph 26 of our decision in CIS/3573/2005. 

10.	However, unlike the related case of CIS/3573/2005, the present appeal raises an additional matter which, in our view, must be dealt with first.  In CIS/3573/2005 it was accepted that the claimant actually was habitually resident in the United Kingdom.  It was in these circumstances that regulation 12(3G) fell to be applied.  In the present case that is not accepted.

11.	The tribunal, in its decision making process in the present case, made it clear in paragraph 8 of the statement of reasons that it was satisfied that the claimant was not habitually resident as a matter of fact.  Although the tribunal has used the words “I would have decided” at paragraph 8 of its reasoning (set out at paragraph 4 herein) it is very clear from the context that the tribunal is making a firm finding to that effect.

12.	Accordingly we must consider whether the tribunal was entitled to come to this conclusion.

13.	Mr Kolinsky submitted that the tribunal’s findings of fact in this respect were suspect in light of the available evidence.  The claimant had made her claim on 11 August 2004 when she was resident in the United Kingdom and she was resident in the United Kingdom on 11 November 2004 when the decision-maker made the decision, the subject matter of the appeal.  She was a single parent with three children all under six.  When filling in form HRT2 form (a form asking for particulars relevant to the habitual residence test) on 25 October 2004 she had stated, in answer to the relevant question, that her plan was to stay permanently in the United Kingdom.  She also stated on the form as follows:

“I want to remain in the UK.  I have a lot of family in the UK.  I want to make the UK my home.  I no longer want to live in Holland.”

Accordingly, Mr Kolinsky relied on this contemporaneous evidence from the claimant about her intentions which, in his submission, was such that the tribunal ought not to have come to a contrary conclusion about her intentions on the grounds of mere speculation.  He submitted that the tribunal failed to apply its collective mind to what the claimant actually stated.

14.	Mr Kolinsky relied on the decision of Mr Commissioner Jacobs in CIS/4474/2003, (also mentioned by the tribunal) in which the Commissioner stated the following:

“18.	This was another issue considered by Mr Commissioner Howell in R(IS) 6/96. The Secretary of State submits that the period of residence that he suggested was long by the standards of what Commissioners now accept when giving their own decisions on habitual residence. He submits when Commissioners give their own decisions on habitual residence, most accept a period of between one and three months as appreciable. That is my impression, although I see fewer of my colleagues’ decisions than does the Adjudication and Constitutional Issues Branch, where the representative is based. 
19.	What is an appreciable period depends on the circumstances of the particular case. But I agree with the Secretary of State that in the general run of cases the period will lie between one and three months. I would certainly require cogent reasons from a tribunal to support a decision that a significantly longer period was required. 
20.	I suspect that the cases in which a tribunal might find that a long period of residence was required would, on examination, better be analysed as cases in which the tribunal was not satisfied that the claimant had a settled intention to remain for the time being.”
15.	Mr Kolinsky conceded that CIS/4474/2003 was “a consent decision” under regulation 28(2) of the Social Security Commissioners (Procedure) Regulations 1999 and therefore not of any precedent value but he relied on the fact that the Commissioner was clearly attempting to give generalised guidance to tribunals.

16.	 Mr Coppel submitted that the tribunal was entitled to conclude, as it did, that the claimant was not habitually resident in the United Kingdom at the relevant time.

17.	Both Counsel relied on the decision of the Court of Appeal in The Secretary for State for Work and Pensions v Bhakta [2006] EWCA Civ 65.  We consider that Auld LJ, at paragraph 28, has set out the two relevant elements in the habitual residence test, namely, both intention and then actual residence, as evidential support for an assertion of an apparently genuine intention to reside.  The relevant period of residence required to support evidence of intention is not, in our view, something which can be reduced to a tariff.  In so far as the decision of Mr Commissioner Jacobs in CIS/4474/2003 can be interpreted to the contrary, we take a different view.  We prefer the approach of the tribunal as set out at paragraph 6 of its statement of material facts and reasons (set out at paragraph 4 herein).

18.	While we may have some concerns about how the last sentence in paragraph 7 of the tribunal’s reasoning (quoted at paragraph 4 herein) is stated, we take the view that the reasoning must be looked at in its entirety.  When one looks at paragraph 3 (again quoted at paragraph 4 herein), it seems clear that the tribunal had considerable reservations in relation to the claimant’s evidence in respect of intention.  This evidence given directly and orally to the tribunal was that she had simply decided to follow many of her relatives who had already come to the United Kingdom. It was these doubts as to the reliability of the claimant’s evidence that led to the conclusion stated in paragraph 8 of the tribunal’s reasons. Therefore, we conclude that the decision of the tribunal in respect of habitual residence is sustainable.  

19.	Decisions such as the one made by the tribunal in relation to habitual residence are matters of judgment and different decision-makers and/or tribunals may well reach different but equally sustainable conclusions on the same facts.  Moreover, as Lord Hoffman said in Moyna v Secretary of State for Work and Pensions [2003] UKHL, 44, at paragraph 25:

“… an appellate court with jurisdiction to entertain appeals only on questions of law will not hear an appeal against such a decision unless it falls outside the bounds of reasonable judgment.”

20.	Accordingly we conclude that the tribunal’s findings in relation to habitual residence should not be disturbed by us as they fall within the bounds of reasonable judgment.  Mr Coppel, having submitted that the tribunal was entitled, in light of the evidence, to come to the conclusion they did on habitual residence, which we accept, submitted that it ought not to have continued to consider regulation 21(3G) issues (the sort of issues dealt with in CIS/3573/2005) as regulation 21(3) makes it clear that a person who is not habitually resident in the United Kingdom etc is “a person from abroad” and therefore can only ever obtain IS of nil amount.  We accept that.  

21.	As the tribunal did not determine the appeal on the basis of its findings on habitual residence, we find that it erred in law on these grounds.  We can, however, on its findings, make the decision that it should have made, which we do at paragraph 1 herein.

22.	The Bhakta case is very recent authority for the proposition that, where the only reason for refusing a claim for IS is that the claimant has not resided in the United Kingdom for a sufficient period to be habitually resident by the date of the Secretary of State’s decision, the decision-maker on behalf of the Secretary of State (or the tribunal) has power, under regulation 13 of the Social Security (Claims and Payments) Regulations 1987 – SI No 1968 – to make an advance award from the date habitual residence is likely to be established, provided that this is within the three months time limit, imposed by regulation 13, from the date of claim.  The conclusion of the Court of Appeal has potential relevance to the present proceedings.  However, there is, in our view, a significant difference between the instant case and Bhakta.  The tribunal in the Bhakta  proceedings found that the claimant had a settled intention to remain in the United Kingdom and that she had had this intention from the time of her arrival – see the judgment of Auld LJ at paragraph 15.

23.	Mr Commissioner Rowland, who was deciding a factual matter under section 14(8)(a)(i) of the Social Security Act 1998, in the place of the tribunal (and ultimately the decision-maker), made it clear in his decision in the Bhakta case (CIS/1840/2004 at paragraph 25) that it was his view that a tribunal may make an advance award where a claimant shows an intention to take up prolonged residence in the United Kingdom and where the only reason for not awarding an amount of IS greater than nil is that the claimant has not resided in the United Kingdom for a long enough period.  Accordingly the Commissioner had found that there was a settled intention.  The Court of Appeal supported the Commissioner’s view.

24.	However, in the present proceedings there has been no finding of settled intention and, for the reasons stated at paragraphs 15 to 21 herein, we have already concluded that the tribunal was entitled to come to that finding.  Therefore we conclude that Mr Coppel is correct in his submission that the Bhakta case does not assist the claimant in this appeal.

25.	In any event, we do not consider that the Bhakta case could ever have assisted the claimant, as its effect would be defeated by virtue of regulation 21(3G) of the Income Support (General) Regulations 1987 if the claimant did not have a right to reside, for the reasons that we have set out in CIS/3573/2005 which would apply to a forward award as it would to other awards. 
26.	Accordingly, we do not consider that the Bhakta case affects our conclusion set out at paragraph 22 herein.

27.	Therefore, we find that the other matters raised by both Mr Kolinsky and Mr Coppel are no longer issues to be decided in this case.   However, for completeness we point out that similar submissions were made to those that were made to us concerning “the right to reside” in CIS/3573/2005, as well as an entirely new submission relying on the European Convention on Human Rights in the context of regulation 21(3G).  Our decision in CIS/3573/2005 has already set out our considered views on “the right to reside”.  Furthermore we do not think it appropriate to come to any conclusion on the Convention matters as we find that these issues do not arise in this appeal by virtue of the manner in which we have decided the appeal.

(Signed)
D J MAY QC
Commissioner

(Signed)
J M HENTY
Commissioner

(Signed)
HIS HONOUR JUDGE MARTIN QC
Chief Commissioner, Northern Ireland
Sitting as a Deputy Commissioner in Great Britain

Date:  12 May 2006