IN THE UPPER TRIBUNAL	Case No.  CIS/1464/2010
ADMINISTRATIVE APPEALS CHAMBER

Before Judge of the Upper Tribunal Miss E. Ovey

Decision:   The decision of the tribunal contained an error of law.  For the reasons given below, in exercise of my power under s.12(2) of the Tribunals, Courts and Enforcement Act 2007 I set the decision aside and re-make the decision.  I allow the appeal against the decision of the decision maker on 7th September 2009.

REASONS FOR DECISION

1.	This is an appeal by the claimant against the decision of the First-tier Tribunal on 8th March 2010.  The issue before the tribunal was whether the decision maker, in the decision made on 7th September 2009, had rightly decided under the applicable income support legislation that the claimant was not entitled to housing costs in relation to a mortgage over her home.

2.	The facts of the matter are somewhat complicated and it may be helpful to set out separately the position as respects the house and the position as respects income support claims.  As I understand it, the facts are not in dispute.

3.	At all material times until September 2006 the claimant lived at the house she occupied at the time of the decision with her husband and two children, the younger of whom has physical and learning difficulties and is now aged 13.  The property appears to have been in the husband’s sole name and accordingly he was the sole borrower under a mortgage for £34,500 with the Furness Building Society taken out in or about 1997.  The purpose of the mortgage was to provide funds for the acquisition of the property, which the claimant and her husband were already occupying as tenants.  The claimant and her husband thought that if they owned the property they would be able to adapt it as necessary to meet the needs of their younger child, which might include a need for wheelchair access.  The decision was a joint one, although the acquisition was not in joint names.

4.	In September 2006 the claimant’s husband left the property and she remained in occupation with the children.  He continued to pay the sums due under the mortgage.  In November 2006 the husband borrowed a further £30,000 on the security of the house by what has been described as an equity release arrangement.  This borrowing was also from the Furness Building Society and I take it that it was therefore a further advance under the terms of the mortgage.  The claimant did not agree to this further borrowing, which seems to have been for the purpose of enabling the husband to buy another property to live in with his new partner.  I comment that if she had formally consented to the initial mortgage (as one would expect), it is possible that a further advance might have been made by the building society without seeking any further consent from her, although in other circumstances it is the general practice of mortgage lenders to require consent from any adult who is going to be in occupation of the property when the loan is made.

5.	In early 2008 the claimant’s husband ceased to make the payments under the mortgage.  In her evidence to the tribunal the claimant said that he rang her and said that he could not afford two properties and would sell the house unless she took over the mortgage.  (I note that the record of proceedings puts this as having occurred in January 2007, but it seems to me that the claimant and the tribunal had got a year out at this point, as appears from what is stated in paragraphs 6 and 7 below.)  He cancelled the payments and she received a telephone call from the Furness Building Society.  Following those events she tried to find a mortgagee who would accept her as a borrower and was eventually successful in obtaining a loan from GE Money, which was completed on 14th May 2008.  The loan was in the sum of £73,200 and was recorded by GE Money as having been for the purpose of transfer of equity.  It is clear that on completion the Furness Building Society was repaid £64,619.16 and the property was transferred from the husband’s name to the claimant’s name.

6.	The claimant first claimed income support on 11th January 2007.  Her husband was then still paying the mortgage, as the claimant informed the Department of Work and Pensions, and so the question of housing costs did not arise.  She told the Department that if things changed she would contact them (p.4).

7.	In October 2007 the claimant’s new partner, who was himself already claiming income support, moved into the house.  His existing claim was superseded by a decision including the claimant in his claim and her independent claim ceased.  When the claimant’s husband ceased to make the mortgage payments, her partner informed the Department on 14th February 2008 and the Department sent a mortgage interest form to him, which I understand was for the purpose of enabling to apply for housing costs in respect of the mortgage.  The application was not, however, completed before the transfer of the house to the claimant and the repayment of the Furness Building Society mortgage.  Further forms were sent on 3rd June and 10th July 2008 and the claimant’s partner returned a form on 21st July 2008 seeking housing costs in respect of the GE Money mortgage.  The completed form also made the point that the house could have been sold if the claimant did not buy out her husband.

8.	Before a decision was made on the application, in September 2008, the partner got a new full-time job and moved out of the house.  His claim for income support was therefore superseded and came to an end.  He had not supplied all the information required for the housing costs claim in respect of the mortgage, so in due course that claim ceased with no decision having been made.  The claimant herself made a fresh claim for income support on 15th September 2008 and included in her application a reference to the house and the GE Money mortgage.

9.	There seems to have been a long delay in making a decision on the claimant’s housing costs, but that seems to have been at least in part the result of the claimant’s delay in providing requested information.  Eventually the decision was made on 7th September 2009 that the claimant was not entitled to a payment in respect of her housing costs.  The basis of that decision was that the GE Money mortgage was entered into while the claimant was receiving income support.

10.	The relevant statutory provisions are found in Sch. 3 to the Income Support (General) Regulations 1987, S.I. 1987 No. 1967.  The basic framework is as set out, so far as material, in the following provisions:

“1.(1)	Subject to the following provisions of this Schedule, the housing costs applicable to a claimant are those costs – 

(a)	which he, or, where he is a member of a family, he or any other member of the family is, in accordance with paragraph 2, liable to meet in respect of the dwelling occupied as the home which he or any other member of his family is treated as occupying, and 

(b)	which qualify under paragraphs 15 to 17.”

“2.(1)	A person is liable to meet housing costs where – 

(a)	the liability falls upon him or his partner but not where the liability is to a member of the same household as the person on whom the liability falls;

(b)	because the person liable to meet the housing costs is not meeting them, the claimant has to meet those costs in order to continue to live in the dwelling occupied as the home and it is reasonable in all the circumstances to treat the claimant as liable to meet those costs …”

“15.(1)	A loan qualifies under this paragraph where the loan was taken out to defray moneys applied for any of the following purposes – 

(a)	acquiring an interest in the dwelling occupied as the home; or

(b)	paying off another loan to the extent that the other loan would have qualified under head (a) above had the loan not been paid off.”

11.	If one paused there, it would seem that the claimant is entitled to a payment in respect of housing costs, since she is liable to make payments to GE Money in respect of a loan to defray moneys applied in paying off the Furness Building Society and procuring the transfer of the house from her husband to herself.  On the facts which appear in the papers, it is not clear whether prior to 14th May 2008 she had a beneficial, although not a legal, interest in the house, but on any view she acquired her husband’s interest, whether it was in the whole house or in some fraction of it.

12.	The stumbling block in the claimant’s way is paragraph 4(2), which reads as follows:

“4.(2)	Subject to the following provisions of this paragraph, loans which, apart from this paragraph, qualify under paragraph 15 shall not so qualify where the loan was incurred during the relevant period and was incurred:

(a)	after 1st October 1995 … “ 	  

The “relevant period” is defined by paragraph 4(4) to include any period during which the person to whom the loan was made is living as a member of a family one of whom is entitled to income support.  Since at the time the loan was entered into, the claimant was living with her new partner who was claiming income support it is clear that at first sight she falls within paragraph 4(2).

13.	In those circumstances, the question which falls to be determined is whether the claimant also falls within any of the exceptions contained in the subsequent sub-paragraphs of paragraph 4.  The possible exceptions to be considered are the following:

(1)	sub-paragraph (6), which provides:

“Where the loan to which sub-paragraph (2) refers has been applied – 

(a)	for paying off an earlier loan, and that earlier loan qualified under paragraph 15 during the relevant period; …

then the amount of the loan to which sub-paragraph (2) applies is the amount (if any) by which the new loan exceeds the earlier loan.”

(2)	sub-paragraph (8), which by virtue of sub-paragraph (7) permits a claim where its conditions are satisfied and provides:

“The conditions specified in this sub-paragraph are that – 

(a)	during the relevant period the claimant or a member of his family acquires an interest (“the relevant interest”) in a dwelling which he then occupies or continues to occupy as his home; and

(b)	in the week preceding the week in which the relevant interest was acquired, housing benefit was payable to the claimant or a member of his family …”

(3)	sub-paragraph (9), again given effect by sub-paragraph (7), which reads:

“The condition specified in this sub-paragraph is that the loan was taken out, or an existing loan increased, to acquire alternative accommodation more suited to the special needs of a disabled person than the accommodation which was occupied before the acquisition by the claimant.”

14.	The second of those possibilities, which requires there to have been a payment of housing benefit to the claimant or a member of the claimant’s family, does not assist, since it has been established that housing benefit was not being paid to the claimant or anyone else in her family at the material time.  The possibility was rightly dealt with by the decision maker and the tribunal for the sake of completeness, but this is not an argument ever advanced by the claimant.

15.	The third of those possibilities founders at least on the ground that alternative accommodation was not acquired with the loan; the accommodation occupied by the claimant and her children was the same at least since prior to the younger child’s birth.  That was the basis on which both the decision maker and the tribunal found that paragraph 4(9) did not apply and I agree with them.  The claimant did not pursue this argument in her grounds of appeal to the Upper Tribunal.

16.	There remains the first possibility.  The claimant’s argument has the following steps:

(1)	when her husband stopped making the mortgage payments in early 2008, the claimant had to (and did) make those payments in order to continue living in the house and it was reasonable to treat her as liable to meet those costs, so paragraph 2(1)(b) was satisfied;

(2)	those costs were in part in respect of a loan taken out to defray moneys applied for the purpose of acquiring an interest in the house, so paragraph 15(1)(a) was satisfied during the relevant period;

(3)	therefore from early 2008 onwards the claimant fell within paragraph 1 and if she had made a claim was entitled to income support in respect of her housing costs; 

(4)	the new loan was applied in part in paying off the earlier loan and so to that extent fell within paragraph 4(6)(a).

This is perhaps most clearly set out in the claimant’s representative’s letter dated 14th May 2010 seeking permission to appeal at pp. 54-55, but the argument is also raised in her representative’s letter of appeal to the tribunal dated 20th October 2009 at pp. 1-2.

17.	As is apparent from the summary of the argument set out above, it is clear that any claim by the claimant must be limited to housing costs in respect of the initial £34,500 loan and cannot extend to the further advance of £30,000.

18.	The substance of the objection to this argument is primarily expressed as being that the Furness Building Society loan did not qualify under paragraph 15.  This appears from the following:

(1)	a letter of clarification from the Department dated 8th October 2009 after reference to the legal team, stating:

“The liability under [that loan] was the ex-husband’s and he never claimed benefit while he was living there.  No benefit was paid in respect of the loan before it was paid off.”

(2)	a decision on reconsideration made by the Department on 16th December 2009, stating:

“The original mortgage also would not have been allowed as the customer’s ex-partner was liable for this and he never claimed benefit whilst he lived there.  Therefore the mortgage that the customer has taken out is not allowable as it was not taken out to pay off an existing loan.”

(3)	the relevant passages from the tribunal’s decision, which read:

“9.	There is no liability of [the claimant] to pay housing costs prior to 14 May 2008 when she became liable to her mortgage provider.  Before that date her ex-husband … was liable to make payment of the housing costs and [he] was making such payments until February 2008.  No complete application for housing costs was made until after she had purchased the house in her name and took out a mortgage to do so.  [The claimant] was therefore not liable to meet housing costs prior to 14 May 2008.  She had no liability to the Furness Building Society and paragraph 2(1)(b) of Schedule 3 of the Income (General) Regulations is not satisfied.  She was therefore not liable to meet housing costs prior to 14 May 2008.

10.	[The claimant] took out the mortgage in respect of her home on 14 May 2008 at a time when she was entitled to Income Support by virtue of her partner’s claim for this benefit.  The original loan in the sole name of her ex-husband does not qualify as [the claimant] never made any contributions to that mortgage.  She may have paid certain household expenses which relieved [her husband] from paying for such expenses, including his mortgage, but there is no evidence that she had a liability to make such payments for the mortgage.  When [the claimant] took out a loan in May 2008 it was not to pay off an existing allowable loan as that earlier loan did not qualify during a relevant period.”

19.	The present appeal is brought with the permission of the tribunal judge, who said:

“Permission to appeal is granted because the Tribunal did not find that there was a liability to pay the mortgage costs.  No mortgage payments were made by the Appellant until she herself became legally liable on 14 May 2008.  Liability to pay does not equate with a legal liability but at no time did [the claimant] make payments to the mortgage until she became the mortgagee [sic] on 14 May 2008.  I consider there has to be some evidence to show the emergence or attachment of a liability.  That on her former partner ceasing to pay the mortgage a commensurate liability arises even if [the claimant] does nothing to initiate or assume that liability if initiated, is wrong on principles of contract and trust law.  However my interpretation of the law may be wrong.”

20.	The Secretary of State’s submission to the Upper Tribunal deals with the matter as follows:

“11.	I submit that none of the exceptions in paragraph 4 apply here.  Paragraph 4(6)(a) does not apply because the earlier loan had not been a qualifying loan during the relevant period.  The ex-husband had been liable for it, he had been sole owner and no award of housing costs had been made in respect of it.

12.	[Deals with whether the loan could be said to have been “incurred” prior to May 2008.]

13.	With regard to the point made by the claimant’s representative about paragraph 2(1)( b) of Schedule 3 I submit that this provision is not a way of meeting housing costs when all else fails but operates to enable a person to be treated as liable when they are not.  Since May 2008 the claimant has been liable for the loan so there is not need to treat her as liable.  Prior to that point she had in any event been able to continue living in the dwelling occupied as the home.  So it cannot be said that she needed to be treated as liable in order to continue living there.  Consequently I submit that paragraph 2(1)(b) cannot apply in this case.”

21.	The Secretary of State went on to draw attention to the Commissioner’s decision in CIS/14/1993, in which it was held that in order for paragraph 2(1)(b) to apply there had to be an immediate threat to the continued occupation of the home, a view which was confirmed in CPC/1530/2009, UKUT 225 (AAC).  He also pointed out that similar issues were under consideration in another appeal, CIS/668/2010.

22.	I accept that the loan which was entered into on 14th May 2008 cannot be said to have been “incurred” at any earlier date.  That, however, does not bear on the question whether paragraph 4(6)(a) is satisfied, in relation to which the issue is whether the earlier loan qualified under paragraph 15 during the relevant period.

23.	It is to be noted that paragraph 15 is concerned solely with the purpose for which the loan was taken out.  It contains no requirement as to the person by whom the loan was taken out or that housing costs should have been being paid or payable in respect of that loan.  In my view paragraph 4(6) is to be read as if it provided:

“Where the loan to which sub-paragraph (2) refers has been applied – 

(a)	for paying off an earlier loan which was itself a loan taken out to defray monies applied for any of the following purposes – 

(i)	acquiring an interest in the dwelling occupied as the home …”

In other words, the provisions of paragraph 15 are to be read into paragraph 4(6) without any additions derived from paragraph 1 or paragraph 2.

24.	If that reading is correct, the claimant satisfies the requirements of paragraph 4(6) in respect of the loan from GE Money as to £34,500, since it is clear that the GE Money loan was applied in part to discharge the original purchase loan from the Furness Building Society.

25.	I have considered whether there are any policy reasons why paragraph 4(6) should instead be read as if it provided:

“… for paying off an earlier loan, and that earlier loan qualified under paragraph 15 during the relevant period and was a loan in respect of which the claimant was, in accordance with paragraph 2, liable to meet the costs …”

or in some similar way, but that does not seem to me to be the case, for the following reasons.

26.	As paragraph 23 above indicates, paragraph 15 does include, in my view, a requirement that the loan in question should be a loan applied in connection with the house being occupied by the claimant as his or her home.  This inevitably substantially limits the range of circumstances in which paragraph 4(6) may apply.  Further, paragraph 4(6) limits the amount of the loan in respect of which the benefit of the exemption applies to the amount of the original loan.  Further still, in many cases, perhaps the substantial majority, the claimant will in fact himself or herself be liable in respect of the original loan, so there is no change in the burden on the public purse.

27.	 Any restriction such as I have indicated in paragraph 25 above would therefore meet only the case in which a claimant, who is not previously liable in respect of the loan, incurs a new loan to enable repayment to be made for the benefit of another party.  It is difficult to conceive of circumstances in which such a transaction would take place which would not involve the claimant acquiring a legal or beneficial interest in the property from the other party or, at least as a matter of legal theory, becoming entitled to the rights of the previous mortgagee by subrogation.  

28.	The latter situation would have the disadvantage from the point of view of the claimant of entitling him or her to receive the mortgage payments from the original borrower under the terms of the original mortgage, which would no doubt affect the income support claim and is unlikely to prove attractive as a means of making use of the income support system.

29.	The former situation involves a willingness on the part of the other party to give up an interest in the property, suggesting that the principal circumstances in which the situation is likely to arise are where members of a family have fallen out and one member no longer seeks to occupy the property as his or her home.  In such cases, the whole transaction is likely, as in the present case, to be one by which the claimant is intended to be enabled to continue living in the home while releasing the departed other party from the obligations of the original mortgage.

30.	If that is correct, to read in a restriction along the lines indicated in paragraph 25 would give rise to what appear to me to be unjustifiable anomalies, as illustrated by the following:

(1)	it seems to be clear that if the claimant had been a party to the original mortgage with the Furness Building Society, the requirements of paragraph 4(6) would have been satisfied if she had remortgaged to GE Money, as she did, in order to obtain the release of her former husband from the mortgage and to acquire his interest in the house;

(2)	it also seems to be clear that if the Furness Building Society had brought possession proceedings against the claimant which had been adjourned for her to attempt to remortgage the property, she would have been treated as liable under that mortgage by the application of paragraph 2(1)(b):  see the Commissioner’s decision in CIS/014/1993 and so, on my rewriting of paragraph 4(6) as set out in paragraph 25 above, would have satisfied the requirements of that paragraph;

(3)	further, as I understand the position, it is accepted that if the claimant had previously established entitlement to housing costs in respect of the Furness Building Society mortgage by virtue of paragraph 2(1)(b) and had subsequently reached agreement with her husband to resolve matters between them by remortgaging the house in return for the transfer of his interest in it, she would also have satisfied the requirements of paragraph 4(6).

31.	In my view, there are no policy reasons which would justify reading in words which would distinguish between claimants on the basis of the state of the legal title to, and thus the legal liability under the mortgage of, the property or on the basis of the point in time at which the remortgage takes place in a situation where it is clear that the absent original borrower is refusing to continue to meet the payments under the original mortgage.

32.	If I am right on my construction of paragraph 6(4) as set out in paragraph 23 above, the tribunal clearly erred in law, since the tribunal proceeded on the basis that the GE Money mortgage was not taken out to replace an existing allowable loan because the claimant was not liable on the Furness Building Society mortgage and paragraph 2(1)(b) was not satisfied.

33.	Even if I am wrong on the true construction of paragraph 6(4), it seems to me that the tribunal erred in law in the way in which it dealt with the paragraph 2(1)(b) argument.  No separate reasons were given for rejecting the argument that that provision applied.  What is said in paragraphs 9 and 10 of the decision appears to address solely the question of legal liability, although clearly paragraph 2(1)(b) is intended to meet the case where there is no legal liability but the claimant is, in the circumstances there specified, to be treated as liable.  It does not seem to me possible for the claimant to understand in what circumstances the tribunal thought that that provision would apply and why she did not fall within it.

34.	On both those grounds, then, I have power under s.12 of the Tribunals, Courts and Enforcement Act 2007 to set aside the tribunal’s decision, and I conclude that I should do so.  Since the first ground on which I set the decision aside involves a pure point of law, which on my construction leads to the conclusion that paragraph 4(6) applies and the claimant is not barred by paragraph 4(2) from claiming housing costs in respect of part of the GE Money loan, it is clearly appropriate that I should re-make the decision to give effect to my conclusion on the law.

35.	The second ground raises the question of fact whether the claimant did fall within paragraph 2(1)(b):  that is to say, whether she had to meet the housing costs in order to continue to live in her home and it was reasonable in all the circumstances to treat the claimant as liable to meet those costs.  In my view, there is sufficient material for me to make a finding of fact that she did satisfy those requirements.

36.	In making that finding, I have borne in mind the decisions in CIS/014/1993 and CPC/1530/2009.  Those decisions, however, involved facts very far removed from the present.  In the former case, the claimant was living with her daughter and was seeking to recover housing costs in respect of the central heating boiler and gas cooker, both of which had been acquired through hire purchase agreements in the name of the daughter alone.  In practice the claimant reimbursed her daughter for half of the hire purchase payments.  It was argued that she had to meet those costs in order to continue to live in her home because if her daughter did not pay the creditor under the agreements might apply for a charging order over the home as a means of enforcement.  Mr. Commissioner Goodman expressed the view that such a possibility of future action which might result in a threat to the possession of the house did not fall within the equivalent of paragraph 2(1)(b), since it could not be said that she had to meet those costs to continue to live in the house (his emphasis).  He adopted as a test whether there was an immediate threat to possession of the home and gave as an example of such circumstances the case where a mortgagee has brought possession proceedings.

37.	In CPC/1530/2009, the facts were that the claimant and her husband had bought a property in the name of their son and also taken out a mortgage in his name, although they had undertaken responsibility for paying the mortgage.  They had done so because the son was disabled and suffered from learning difficulties and they were seeking to provide for his future.  I assume that they had not legally guaranteed the mortgage payments, since the argument appears to have been solely on the equivalent of paragraph 2(1)(b).  Judge Lane expressed her agreement with the immediate threat test adopted in CIS/014/1993, as contrasted with “a theoretical possibility of this happening in the future”.  There were no relevant findings of fact and the case was remitted for a new tribunal to explore the facts further.  Judge Lane expressly envisaged that there might be circumstances which satisfied the rule.

38.	I note that in the current edition of Bonner on Social Security Legislation (2009-2010) the view is expressed (vol. II, p. 583) that importing a requirement of an immediate threat to possession into paragraph 2(1)(b) is not justified by the wording, although the decision in CIS/014/1993 is thought to be correct on its facts.  In my view, the concept of an immediate threat has some use as a means of stressing the significance of the words “has to” in the provision, but care needs to be taken not to overstate the immediacy of the threat.  The decision itself was plainly right, if for no other reason than that the initial words of the paragraph “because the person liable to meet those costs is not doing so” were not satisfied.  It would be unfortunate if, for example, where the person liable to meet mortgage payments is not doing so, the occupant of the property were not able to avoid the evils (including the financial evils) of being a defendant to possession proceedings by making those payments and claiming housing costs before the default had risen to a level at which proceedings were brought and at which, even on the basis of CIS/014/1993 he or she would satisfy the “has to” requirement.

39.	I find support for this approach in the fact that the Department’s immediate response, on being notified that the claimant’s husband had ceased to make the mortgage payments, was to send the appropriate claim form.  That suggests to me a pragmatic and legally correct recognition by the Department that where the partner who has previously been paying the mortgage ceases to do so, the likelihood is that the claimant who remains in the property will have to make the payments in order to stay there, regardless of whether he or she is legally liable under the mortgage.

40.	On the evidence before the tribunal, including the oral evidence of the claimant, the position was that there was a substantial mortgage over the house with an ordinary institutional lender which, in the ordinary course of things, could and would bring possession proceedings after a certain interval of default.  The claimant’s husband had made clear that he was no longer prepared to make the payments.  Further, additionally to the risk of possession proceedings by the mortgagee, the claimant faced the risk of an attempted sale of the property by her former husband, no doubt with vacant possession.  It is not possible to say what her position would have been if he had issued possession proceedings against her, but this was certainly another threat, and one which was likely to be avoided only by some such expedient as the claimant adopted.  

41.	There is, of course a further element to paragraph 2(1)(b), namely, that it is reasonable in all the circumstances to treat the claimant as liable to meet the relevant housing costs.  In my view it is prima facie reasonable to treat the occupant of a property as liable to meet the costs of a mortgage taken out for the purpose of acquiring the property (bearing in mind that under reg. 17(1)(f) of the Income Support Regulations it is the interest element of the mortgage payment which is actually taken into account), if the original borrower is not making the payments.  The notional liability to pay is matched with the benefit being enjoyed.  That is the case here and in my view the proper conclusion is that it is reasonable to treat the claimant as liable to make the payments.

42.	It follows that if my first ground for allowing the appeal is wrong, the claimant succeeds on the basis that she satisfied the requirements of paragraph 2(1)(b) at the time the GE Money loan was entered into and thus would also have satisfied paragraph 4(6) if it had contained a requirement that the repaid loan must be one in respect of which the claimant was either liable or was to be treated as liable, under paragraph 2.

43.	The consequence of allowing the appeal is that the decision of 7th September 2009 is set aside and replaced with a decision that the claimant is not precluded from entitlement to housing costs by paragraph 4(2) in respect of that part of the GE Money loan which was applied in repayment of the original Furness Building Society loan.

44.	In conclusion, I should add that I have considered the decision in CIS/688/2010, the other case raising similar issues which was helpfully referred to in the Secretary of State’s submission.  That was another case in which a former wife was not legally liable to the mortgagee to make the mortgage payments but was held to fall within paragraph 2(1)(b), although it differed from the present case in that the wife was obliged by court order to indemnify her husband against the mortgage payments and possession proceedings had in fact been issued.  In considering an alternative argument based on paragraph 2(1)(a), however, the judge said:

“Under paragraph 15(1) the loan has to be taken out for the purpose of “acquiring an interest in the dwellinghouse occupied as a home” – there is no requirement that it should have been taken out by the claimant.  It is only the purpose for which it was taken out that is relevant.”

The decision thus affords some support for the view of paragraph 15 which forms part of my first ground for allowing the appeal.  I should, however, have reached the same view in the absence of that decision.

(Signed on the original)	
	Judge of the Upper Tribunal
	28th September 2010