HINCHEY V SECRETARY OF STATE [2005] UKHL 16
FACTS:-
The Claimant had been paid income support for many years, having suffered from irritable bowel syndrome and Disability Living Allowance in the middle category. Her award was for a limited period and expired in October 1998. She applied for a renewal but was refused, and her appeal was dismissed. However she continued to be paid DLA and was overpaid £3,555.40. The question in this appeal was whether the Secretary of State can claim the money back. He had a statutory right of recovery under section 71 of the Social Security Administration Act 1992 ("the Administration Act"):
JUDGMENT::-
Lord Hoffman considered the terms of the section and said that the Social Security Office claimed that the requirements of this section were satisfied because Miss Hinchy had failed to disclose a material fact, namely that her DLA had expired. She accepted that she knew that her DLA award had expired. There were two grounds of appeal. The first was that Miss Hinchy had made disclosure. She said she thought she had mentioned it on the telephone. However the Tribunal said that the absence of any record of such a communication at the Social Security Office made it more likely that she had not done so. The second ground was that in all the circumstances disclosure could not reasonably have been expected of her. The reasons she gave were that she was not in good health and did not understand the benefit system. The Tribunal rejected these excuses.
Miss Hinchy applied to the Commissioner for Social Security for permission to appeal and the Commissioner gave permission in order to enable her to test the correctness of the Tribunal decisions in the Court of Appeal. He dismissed the appeal without giving further reasons and gave leave to appeal to the Court of Appeal.
Lord Hoffman said that the one person who could usually be depended upon to know all the benefits which a claimant was receiving was the claimant himself. And he was usually also in the best position to know about the benefits which were received by other people, such as his wife and children, which might affect his own entitlement.
The Secretary of State had made the Social Security (Claims and Payments) Regulations 1987 (SI 1987 No 1968) as amended. The Commissioners had treated these regulations as placing upon the claimant the primary duty to inform the relevant decision maker of the material facts, including if appropriate the amount of the other benefits which he was receiving. The Commissioners had consistently rejected attempts to introduce a theoretical or constitutional dimension into the question of whether disclosure had been made for the purposes of section 71. They had accepted that the notion of a failure to disclose connoted an obligation to disclose. They had found this obligation either in regulation 32 of the 1987 Regulations or, by implication, in section 71 itself. The obligation was to disclose to a member or members of the staff of an office of the Department handling the transaction giving rise to the expenditure.
These were the principles applied by the Appeal Tribunal in the present case. Miss Hinchy had failed to make disclosure to her local Social Security office. She had done nothing to communicate the information to the relevant decision maker. He was not deemed to know about the cessation of her DLA merely because it was known to, or a decision by, another office of the department. Nor was there any basis for assuming that, on the facts, the non-disclosure had no causal effect because the relevant official had received the information by internal lines of communication. The inference of ignorance from the fact that he made the overpayments was far stronger than the possibility that he knew from a card on the file that the DLA award had in fact ceased.
The Court of Appeal had said that there was no need for the appellant to give the information to the relevant "Income Support Office". Lord Hoffman said that the Court of Appeal was wrong to overturn the decisions of the Commissioners. They had practical experience of the day-to-day working of the benefit system and the principles they had devised to give effect to the legislative scheme dealing with overpayments were entitled to great respect.
Lord Hoffman would allow the appeal and restore the decision of the Commissioner.
Lord Hope and Lord Walker agreed.
Lord Scott dissented. He came to a different construction of what the literature produced by the Social Security Office required Miss Hinchy to do. The statutory scheme created by the 1992 Act, regulation 32 of the 1987 Regulations and the instructions to Ms Hinchy contained in the Notes to her order book, read in conjunction with form A9, did not impose on her the obligation to inform the Social Security Office that her five year DLA entitlement had expired. The Secretary of State had not established that she "failed to disclose" that material fact and, for reasons different from those given by the Court of Appeal, he would dismiss this appeal.
Baroness Hale had serious reservations about the factual conclusion reached by the Tribunal in this case. But they were applying a principle which was at least as favourable to the claimant as those which the House of Lords was applying. They also saw far more claimants than the House of Lords, and were far better equipped to make these sorts of judgments. They had reached the conclusion that these instructions were clear enough for the claimant to understand. Baroness did not think that it was open to the House of Lords to disagree. She would allow this appeal.
FACTS:-
The Claimant had been paid income support for many years, having suffered from irritable bowel syndrome and Disability Living Allowance in the middle category. Her award was for a limited period and expired in October 1998. She applied for a renewal but was refused, and her appeal was dismissed. However she continued to be paid DLA and was overpaid £3,555.40. The question in this appeal was whether the Secretary of State can claim the money back. He had a statutory right of recovery under section 71 of the Social Security Administration Act 1992 ("the Administration Act"):
JUDGMENT::-
Lord Hoffman considered the terms of the section and said that the Social Security Office claimed that the requirements of this section were satisfied because Miss Hinchy had failed to disclose a material fact, namely that her DLA had expired. She accepted that she knew that her DLA award had expired. There were two grounds of appeal. The first was that Miss Hinchy had made disclosure. She said she thought she had mentioned it on the telephone. However the Tribunal said that the absence of any record of such a communication at the Social Security Office made it more likely that she had not done so. The second ground was that in all the circumstances disclosure could not reasonably have been expected of her. The reasons she gave were that she was not in good health and did not understand the benefit system. The Tribunal rejected these excuses.
Miss Hinchy applied to the Commissioner for Social Security for permission to appeal and the Commissioner gave permission in order to enable her to test the correctness of the Tribunal decisions in the Court of Appeal. He dismissed the appeal without giving further reasons and gave leave to appeal to the Court of Appeal.
Lord Hoffman said that the one person who could usually be depended upon to know all the benefits which a claimant was receiving was the claimant himself. And he was usually also in the best position to know about the benefits which were received by other people, such as his wife and children, which might affect his own entitlement.
The Secretary of State had made the Social Security (Claims and Payments) Regulations 1987 (SI 1987 No 1968) as amended. The Commissioners had treated these regulations as placing upon the claimant the primary duty to inform the relevant decision maker of the material facts, including if appropriate the amount of the other benefits which he was receiving. The Commissioners had consistently rejected attempts to introduce a theoretical or constitutional dimension into the question of whether disclosure had been made for the purposes of section 71. They had accepted that the notion of a failure to disclose connoted an obligation to disclose. They had found this obligation either in regulation 32 of the 1987 Regulations or, by implication, in section 71 itself. The obligation was to disclose to a member or members of the staff of an office of the Department handling the transaction giving rise to the expenditure.
These were the principles applied by the Appeal Tribunal in the present case. Miss Hinchy had failed to make disclosure to her local Social Security office. She had done nothing to communicate the information to the relevant decision maker. He was not deemed to know about the cessation of her DLA merely because it was known to, or a decision by, another office of the department. Nor was there any basis for assuming that, on the facts, the non-disclosure had no causal effect because the relevant official had received the information by internal lines of communication. The inference of ignorance from the fact that he made the overpayments was far stronger than the possibility that he knew from a card on the file that the DLA award had in fact ceased.
The Court of Appeal had said that there was no need for the appellant to give the information to the relevant "Income Support Office". Lord Hoffman said that the Court of Appeal was wrong to overturn the decisions of the Commissioners. They had practical experience of the day-to-day working of the benefit system and the principles they had devised to give effect to the legislative scheme dealing with overpayments were entitled to great respect.
Lord Hoffman would allow the appeal and restore the decision of the Commissioner.
Lord Hope and Lord Walker agreed.
Lord Scott dissented. He came to a different construction of what the literature produced by the Social Security Office required Miss Hinchy to do. The statutory scheme created by the 1992 Act, regulation 32 of the 1987 Regulations and the instructions to Ms Hinchy contained in the Notes to her order book, read in conjunction with form A9, did not impose on her the obligation to inform the Social Security Office that her five year DLA entitlement had expired. The Secretary of State had not established that she "failed to disclose" that material fact and, for reasons different from those given by the Court of Appeal, he would dismiss this appeal.
Baroness Hale had serious reservations about the factual conclusion reached by the Tribunal in this case. But they were applying a principle which was at least as favourable to the claimant as those which the House of Lords was applying. They also saw far more claimants than the House of Lords, and were far better equipped to make these sorts of judgments. They had reached the conclusion that these instructions were clear enough for the claimant to understand. Baroness did not think that it was open to the House of Lords to disagree. She would allow this appeal.