Upper Tribunal (Administrative Appeals Chamber)

 

IN THE UPPER TRIBUNAL                 Appeal No: CH/2530/2013

 

ADMINISTRATIVE APPEALS CHAMBER

 

Before: Upper Tribunal Judge Wright

 

 

DECISION

 

 

            The Upper Tribunal allows the appeal of the appellant.

 

The decision of the First-tier Tribunal sitting at Fox Court on 9 November 2012 under reference SC160/11/05317 involved an error on a point of law and is set aside.

 

The substituted decision of the Upper Tribunal is simply to set aside the London Borough of Hackney’s decision(s) of 11 April 2011 on the basis that the grounds for supersession have not been made out by Hackney. The appellant therefore remains entitled to housing benefit and council tax benefit with effect from 14 March 2011

 

This decision is made under section 12(1), 12 (2)(a) and 12(2)(b)(ii) of the Tribunals Courts and Enforcement Act 2007

 

 

 

REASONS FOR DECISION

 

 

1.                   I am satisfied that the decision of the First-tier Tribunal dated 9 November 2012 (“the tribunal”) was erroneous in material point of law and ought to be set aside. I am also satisfied that I ought to substitute my own decision for that of the tribunal. My reasons are as follows.

 

2.                  The tribunal erred in law in (a) holding the housing benefit and council tax benefit awards had been lawfully terminated pursuant to regulations 11-14 of the Housing Benefit and Council Tax Benefit (Decisions and Appeals) Regulations 2001 (the “DMA Regs”), and (b) not properly addressing whether there was any other supersession ground that could lawfully have led to the non-entitlement decision of 11 April 2011 and, if there was, whether any ground was made out (the “termination” decision under regulation 14 itself taking effect as a  supersession decision: per R(H)4/08).

 

3.                  There is a great deal of background to this appeal, but in terms of the relevant decision-making chain the key facts are that by a supersession decision of 16 January 2011 it was decided that the appellant continued to be entitled to housing benefit (and, I assume council tax benefit) with effect from 24 January 2011, but at a higher weekly level due to an increase in his rent (hence the change of circumstances supersession).  There was then a further decision made on 4 March 2011 in which the appellant’s entitlement to housing benefit and council tax benefit was subject of change due to the annual uprating of entitlement figures (pages 182-186). Whether this was by way of revision or supersession is immaterial.  However, what is material is that at the time of the relevant action that led to the decision of 11 April 2011, the appellant had in place a decision to the effect that he was entitled to housing benefit and council tax benefit. Such a decision could only be changed, by Hackney, by way of revision or supersession: see paragraph 11 in Schedule 7 to the Child Support, Pensions and Social Security Act 2000.

 

4.                  The decision making of Hackney then became confused.  In terms of the “termination” supersession process, the first relevant step after the entitlement decision of 4 March 2011 is two letters both of which are dated 11 March 2011 (pages 192 and 193).  The tribunal said (paragraph 31 of the statement of reasons on page 283) that these letters satisfied the requirements of regulation 13(3) and (4) of the DMA Regs. In my judgment they plainly did not. 

 

5.                  Reading back from the termination power in regulation 14 of the DMA Regs, the key to termination is a claimant’s failure to comply with an information requirement.  Moreover, regulation 13(3) requires the authority suspending for failure to furnish information to notify the person of the requirements of the regulation; those requirements being set out in paragraph (4) of regulation 13.  A failure to properly notify the claimant of these requirements will act to invalidate any subsequent termination: AA –v- Hounslow LB [2008] UKUT 13 (AAC).  The requirements are, inter alia:

 

(i)                a (minimum) one month period for the claimant to furnish the information;

(ii)             notice of the possibility of applying for an extension beyond this one-month period to enable the information requested to be supplied: SS –v- North East Lincolnshire Council (HB) [2011] UKUT 300 (AAC) at para. 21; and

(iii)           notice to the effect that the claimant may seek to satisfy the relevant authority that the information does not exists or that he cannot obtain it: AA –v- Leicester CC [2009] UKUT 86 (AAC).

 

6.                  Neither of the letters on pages 192 and 193 met these requirements. If the letter on page 192 was the regulation 13 notice, as the tribunal seems to have found, it required the information “immediately”, and thus failed to give the mandatory minimum of one month: per SS –v- North East Lincolnshire Council.  On the other hand if the letter on page 193 is said to be the regulation 13 letter it would seem to fail even more fundamentally because it does not say what information is needed (all it says is that Hackney “require further proof…”, but not of what), and it also does not give any clue as to the ability of the claimant to ask for an extension of the one month time limit.

 

7.                  The tribunal therefore erred in law in holding that these letters satisfied regulation 13 of the DMA Regs and it therefore, per AA –v- Hounslow, erred in law in holding the decision of 11 April 2011 as being a valid termination decision under regulation 14 DMA Regs. 

 

 

8.                 However, there may have been another decision that Hackney made. This is also dated 11 April 2011.  It is on page 212.  Rather than  expressing itself to be a termination decision under  regulation 14 of the DMA Regs, it appears to be a substantive entitlement decision on a change of circumstances supersession which decides that the appellant is not entitled to housing benefit or council tax benefit (from an unspecified date) because his capital is too high.  This supersession decision can be traced back to Hackney’s letter of 10 February 2011 to the appellant on page 168-169, which was then followed up by Hackney’s letter of 25 February 2011 on page 179.  However what then followed each of those letters was the entitlement decision of 4 March 2011 (p.182).

 

9.                  Which of the two letters of 11 April 2011 the appellant was seeking to appeal is unclear; nor, arguably, did the tribunal take any proper steps to clarify this, which itself amounts to an error of law. Nor is it clear which of the two decisions of 11 April 2011 the operative one was: both could not have been operative unless applying from different dates. 

 

10.              However, if it was the decision on page 212 that was under appeal to the appeal tribunal then the tribunal erred in law in not addressing it, as that would have called for it to have made a substantive decision as to the appellant’s entitlement. Indeed, had the tribunal found (as it ought to have found for the reasons given above) that there was no valid regulation 14 termination decision by way of supersession, then it had a discretion to give consideration to whether any other supersession ground was made out (e.g. change of circumstances on the basis of excess capital): per R(IB)2/04. However, no proper consideration was given by the tribunal to this alternative basis for the 11 April 2011 decision. In failing to do this, the tribunal erred in law.

 

 

 

 

11.               I appreciate that the District Tribunal Judge was of the view when refusing permission to appeal that even if the decision to stop benefit was not made pursuant to regulation 14, the central issue on the appeal was the appellant’s consistent failure to provide the information requested to assess his benefit entitlement. However, absent the provisions of regulations 11-14 of the DMA Regs, a failure to provide information is not of itself a basis for refusing benefit. A substantive entitlement decision (here on supersession) still has to be made. R(H)3/05 is authority for the proposition that a failure to provide information may provide a proper basis for inferring that the person who has not provided the information has something to hide and has, for example, too much income or capital. However, on an appeal against such a decision the appeal is not limited to whether the requested information has been provided, or indeed whether it was reasonably required.  The issue on the appeal is the substantive one of whether the person does not qualify, or no longer qualifies, for housing benefit and/or council tax benefit because, say, he has too much capital. The adverse inference drawn by the local authority is the starting point, and it may be the end point if the appellant does nothing to rebut the drawing of the inference and that inference was justified.  However, the appellant may rebut the inference or otherwise satisfy the tribunal that he has, for example, no capital. The problem here, however, is that the tribunal took no steps to investigate this issue with the appellant: its focus was on regulations 13-14 of the DMA Regs. In these circumstances I do not see how it can be argued that any failure of tribunal on regulations 11-14 of the DMA Regs was not material to its decision.

 

12.              I am therefore satisfied that the tribunal’s decision of 9 November 2012 was vitiated by material error of law.  That then leaves for consideration whether I ought to set the decision aside and, if I do, what then happens, and that leads on to other matters that I now address.        

 

13.              Having given permission to appeal to the appellant on 11 September 2013 and sought the views of the parties on whether they had any objection to the tribunal’s decision being set aside for the above errors of law, Hackney responded by way of a letter dated 3 October 2013 in which it informed the Upper Tribunal that “[s]ubsequent to the tribunal’s original decision dated 9 November 2012 [the appellant] provided additional evidence and on 3 April 2013 the authority revised its decision of 12 April 2011, reinstating Housing and Council Tax Benefit from 14 March 2011 thereby lapsing the original appeal”.  (The date “12 April 2011” is an obvious typographical error, it must mean 11 April 2011.)

 

14.              This new information led me to issue the following directions on 30 October 2013:

 

“As far as I can see, Hackney’s decision of 3 April 2013 renders this appeal to the Upper Tribunal entirely academic. Had I known about it at the time I was considering whether to give permission to appeal I may well have refused to give permission – despite the very arguable errors of law in the First-tier Tribunal’s decision – because the substance of the decision under appeal (i.e. that [the appellant] ceased to be entitled to housing benefit and council tax benefit with effect from 14 March 2011) no longer existed.  As permission to appeal has been granted, however, I consider I have two options. The first is to set aside the tribunal’s decision for error of law.  No further appeal could or would need to be made against the 11 April 2011 decision as that decision has been revised out of existence (so to speak). The second option, which comes the same effect, is, notwithstanding any error of law in the First-tier Tribunal’s decision, not to set aside the  tribunal’s decision aside as a matter of my discretion (per section 12(2)(a) of the Tribunals, Courts and Enforcement Act 2007)  because it is no longer of any legal effect.

 

The parties are asked to advise the Upper Tribunal which of these two options it considers the more appropriate. If it is to be argued that neither option is appropriate then grounds need to be provided explaining why that is so. For example, if it is said that the decision of 3 April 2013 does not render this appeal academic, what more of any practical of substantive benefit may be gained from this appeal.  It may assist the parties to note in this regard that the Upper Tribunal on an appeal such as this one has no powers beyond ruling if the First-tier Tribunal erred in law. For example, the Upper Tribunal has no jurisdiction over payment of benefit or remedies (e.g. charging interest) for late payment of benefit, nor has it any jurisdiction to examine or rule on consequences that may have arisen from benefit being stopped.”

 

 

 

15.               Hackney responded on 11 February 2014 asking that the second option be taken. The appellant responded on 11 March 2014 and argues that Hackney’s later decision does not resolve his dispute and that matters remain to be determined by the Upper Tribunal.

 

16.              I will deal with the appellant’s response first. He is wrong to assert that by the directions of 30 October 2013 the decision giving permission to appeal had been superseded. The directions of 30 October 2013 had no such effect. As their terms make plain the grant of permission to appeal remains in place. His main concern is that Hackney’s initial stance in asking for certain unredacted financial information from him breached his human rights and led to adverse consequences for him in terms of possession proceeding taken against him.

 

17.               I can see no arguable merit in the human rights arguments sought to be relied on by the appellant. Housing benefit and council tax benefit are (or were in respect of the latter) means-tested benefits entitlement to which therefore depends upon a claimant giving full and frank disclosure of his or her sources of income at the relevant time and his or her capital holdings. Redaction of details on bank accounts held by the appellant can clearly frustrate the decision making body in applying the statutory means test and I can see no arguable basis in human rights law terms, certainly on the facts of this case, that would hold it unlawful for a local authority to ask for such information. Further, I have no jurisdiction over the possession proceedings or whether Hackney acted unlawfully in bringing them.

 

18.              However, whatever the merits may be in the appellant’s human rights arguments, the critical point is that they are now rendered entirely academic on this appeal given Hackney has now awarded the appellant all the benefit its decision under appeal had previously denied him.

 

 

19.              This last statement is, however subject to Hackney’s awarding decision of 3 April 2013 being one it had the jurisdiction to make.  If it was, or is, not then the payments made pursuant to that decision may be said not to be payments of housing benefit or council tax benefit at all as they were not payments made on a lawful award of benefit.

 

20.             The effect of Hackney’s decision of 3 April 2013 was purportedly to revise its decision of 11 April 2011.  However, revision on any ground can normally only take place within one month of the decision being revised (regulation 4(1)(b) DMA Regs) or if the decision is being appealed to the First-tier Tribunal (regulation 4(1)(c) of the DMA Regs).  On the other hand, a decision can only be revised at any time (i.e. after one month and where that one month period has not been extended), on the specified grounds set out in regulation 4(2) of the DMA Regs.  Neither ground was available or was relied on here as the 11 April 2011 decision did not arise from an “official error” and it was not a decision that was more advantageous to the appellant (whether or not it was made in ignorance of a material fact). I also harbour very considerable doubts over whether regulation 5 of the DMA Regs permitted the local authority to extend time for a revision under regulation 4(1)(b) of the DMA Regs as regulation 5 very arguably only applies to that class of revision that arises from an application being made; that is, it only applies to extend time in respect of regulation 4(1)(a) DMA Regs revisions. The terms of regulation 4(1)(a)(ii) of the DMA Regs would seem to support this analysis and it is an analysis which in my view is consistent with the reasoning in paragraph 68 and 71 of R(IS)15/04.

 

21.              However, if this analysis is correct it means that Hackney had no lawful basis for revising the decision 11 April 2011 so as to award benefit to the appellant from 14 March 2011. Nor as far as I can see could it on 3 April 2013 have superseded the 11 April 2011 decision so as to award benefit from 14 March 2011; though as the decision of 3 April 2013 is not under appeal to me I have no jurisdiction, per R(IB)2/04, to correct the revision decision.

 

22.             There is, however, another problem with Hackney’s decision, which I highlight because it is a not uncommon problem with some local authorities applying the law on revision and supersession and because it is relevant to how I have decided to dispose of this appeal.

 

23.             The further problem is that even assuming the problem highlighted in paragraph 20 above does not arise, Hackney’s purported revision of the 11 April 2011 decision was wrong in law because that decision legally no longer existed to be revised.  This is because at the time the purported revision decision was made on 3 April 2013 the 11 April 2011 decision had, in my judgment, been replaced by the tribunal’s decision of 9 November 2012, and the local authority has no power to revise a First-tier Tribunal decision.

 

24.             The flaw in Hackney’s analysis on this point underpinning its decision of 3 April 2013 was that legally the 11 April 2011 decision continued to exist notwithstanding the tribunal’s decision of 9 November 2012. This is wrong, in my judgment. The last decision was the operative decision, and it was that decision which Hackney had to seek to change, if the law allowed it to do so.

 

25.              Plainly if the tribunal had set aside Hackney’s decision(s) of 11 April 2011 then there could be no question of the 11 April 2011 decision(s) still existing. But in my judgment the same applies where the First-tier Tribunal confirms the decisions under appeal to it. That, it seems to me, follows from the analysis in R(I)9/63 (at paragraph 19), R(IB)2/04 (at paragraph 15) and ED-v- SSWP (DLA) [2013] UKUT 0583 (AAC).

 

26.             The consequence of all of this is that legally the decision of 3 April 2013 had no proper basis. That consideration has led me to make the decision in the form set out above.  The tribunal’s decision is set aside and, pursuant to section 12(2)(b)(ii) of the Tribunals, Courts and Enforcement Act 2007, I make the decision the tribunal ought to have made. My decision is to allow the appellant’s appeal and simply set aside Hackney’s decision(s) of 11 April 2011 on the basis that neither decision (if two decisions were made on 11 April 2011) was properly arrived at. In other words, I decline as a matter of my discretion to remake the supersession decision.

 

(i)                The regulation 14 DMA Regs termination/supersession decision of 11 April 2011 is set aside for the reasons given above.

 

(ii)             The “adverse inferences” supersession decision of the same date (if made) is set aside because Hackney have failed on the appeal to discharge the onus on them of showing why on the evidence the appellant was no longer entitled to benefit.    

    

(iii)           And, in the light of the payments of benefit made to the appellant for the period back to 14 March 2011, as a matter of my discretion I decline to remake or perfect a supersession decision dated 11 April 2011 and so leave in place the last awarding decision of 4 March 2011.   

 

27.              The effect of this is:

 

(a)       that the decision of 4 March 2011 awarding housing benefit and council tax benefit to the appellant remains in place, and

 

(b)       as a consequence, the 3 April 2013 (invalid) decision simply falls away and is of no effect.

 

The monies paid to the appellant pursuant to the 3 April 2013 decision

therefore become lawful payments of benefit made pursuant to the 4

March 2011 decision.

 

28.             An alternative analysis could also apply, which comes to the same effect. This is that by its actions on the appeal to the tribunal Hackney have to be taken as having expressly abandoned the 11 April 2011 decision as being anything other than a regulation 14 DMA termination/supersession decision. The only decision therefore was the regulation 14 decision of 11 April 2011, and for the reasons given above it was not properly made and did not act to terminate the appellant’s entitlement.  

 

29.             I should add that I have rejected Hackney’s request that the tribunal’s decision remain in place. For reasons which I hope are evident from the discussion above, were that to happen then the concerns as to the legality of the 3 April 2013 decision and the award made under it would remain.

 

30.             A possible alternative solution would have been for the Upper Tribunal to set aside the grant of permission to appeal pursuant to rule 43(1) and (2)(b) or (d) of the Tribunal Procedure (Upper Tribunal) Rules 2008 on the basis of material non-disclosure by the appellant, namely his failure to notify the Upper Tribunal of the 3 April 2013 decision when he applied for permission to appeal. However, I decline to take that course for two reasons. First, it is in fairness to the parties not a matter I have raised with them. Second, it has the disadvantage of leaving in place the tribunal’s decision.                      

 

 

 

 

(Signed) S. M. Wright

Judge of the Upper Tribunal

                                                                                                          

Dated 12^th June 2014