Braintree District Council v Thompson
| Jurisdiction | England & Wales |
| Judge | Lord Justice Ward,Lord Justice May,Lord Justice Dyson |
| Judgment Date | 07 March 2005 |
| Neutral Citation | [2005] EWCA Civ 178 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: C3/2004/1831 |
| Date | 07 March 2005 |
[2005] EWCA Civ 178
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
The Social Security Commissioner
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Ward
Lord Justice May and
Lord Justice Dyson
Case No: C3/2004/1831
Mr Michael Lane (instructed by Braintree District Council) for the Appellant
Mr Alisdair Stuart Thompson appeared in Person
Introduction.
This appeal arises out of a claim by a local authority for housing benefit paid in excess of entitlement to be recovered from the person to whom it was paid because of the fraud he perpetrated on the local authority. The Social Security Appeal Tribunal allowed the claim of Braintree District Council ("the council") against Mr Alisdair Thompson ("the respondent") but the Deputy Commissioner Mr Michael Mark allowed Mr Thompson's appeal. The council were given permission to appeal against his decision by Mummery L.J.
The Background Facts
The case was presented to us in a state of muddle and the position has only become clearer from reading the extra pages we sought at the conclusion of the hearing. This picture has emerged. The respondent is the owner of a flat at 23 Trafalgar Court, Braintree. In about April 1991 his friend Mr Unsworth ("the tenant") came again to live with him at the flat. He was unemployed and made a claim for housing benefit on the basis that he was renting one room from the respondent who occupied the other bedroom and they shared the rest of the house together. There is no clear evidence of the rent which was fixed at that time. It seems to have been agreed at £80 or thereabouts though the friendly understanding between the landlord and tenant is more likely to have been that the rent would be whatever the tenant could obtain by way of housing benefit. The tenant duly applied for and obtained housing benefit paid to him by the council but there is some uncertainty as to how much was paid. I will elaborate in due course.
There was an important turn of events in about July 1992. The respondent and his tenant informed the council that the respondent moved out of the flat on 17 th July 1992 leaving some belongings stored in what had been his bedroom. The tenant continued to claim housing benefit but from this time onwards he supported his claim for housing by a declaration that no one else lived in the flat with him. Precisely how this change in the occupation of the flat would have affected his entitlement and the amount that would be payable to him is one of the mysteries in the case. I must also return later to this important question. For the moment it is sufficient to say first, that the council would ordinarily allow less housing benefit where the accommodation is shared; secondly, that the tenant now being in sole occupation would become liable for the poll tax/council tax but would probably be entitled to a single person discount of perhaps as much as 25% although, as I understand it, because he was receiving housing benefit his liability would in fact be reduced to nil; and thirdly, that the respondent, having moved out of occupation, would cease to be liable for that tax in respect of that property. The respondent from this time onwards received the housing benefit direct from the council. There is also a suggestion that he was eligible for and did obtain income support on the basis that the rent would not be treated as income because, not being resident at the flat, he could apply the housing benefit to discharge the mortgage payments on the flat.
In 1999 there was an extraordinary development. Both the respondent and the tenant were serving councillors on this District Council. It was council policy to conduct periodic investigations into whether or not councillors were paying their council tax. In the course of such an inquiry the council discovered that the respondent was living in the flat with his tenant and that he had in fact never moved out. That resulted in the prosecution of the respondent and his tenant in the Chelmsford Crown Court on a count of conspiracy to defraud, contrary to common law. The particulars of the offence were that the tenant and the respondent between 1 st April 1991 and 20 th October 1999 conspired together to defraud the council by falsely claiming that the tenant was the sole occupant of the flat. Both defendants were represented by counsel at their trial before Judge Hawkesworth and a jury which lasted 11 days. They were both convicted and both were sentenced to a term of 30 months imprisonment reduced on appeal to 18 months.
The events which have led the matter back to the court of appeal on this appeal began with a notice dated 8 th March 2001 given by the council to the respondent demanding repayment of £16,196.57 housing benefit overpaid and stating the reason for the demand to be "contrived tenancy". The period of overpayment was from 14 th August 1995 to 17 th October 1999 during which period all the payments were made directly to the respondent.
The respondent appealed to the Appeals Tribunal, and, as noted by the Tribunal:—
"prosecuted the appeal on the basis that he had in fact moved out and referred to the microfiche records latterly disclosed by the Respondent showing uplift in benefit when the local authority was notified that he had moved out of the premises. The chairman pointed out that his conviction was on the basis that he had not moved out and had remained in the premises. The second ground of the appeal as put today was that Mr Unsworth had a underlying entitlement even if Mr Thompson was resident and that it was either an error to fix him with an overpayment or it should only be to the extent of the difference between the rate payable for sole occupancy and the shared occupancy."
On 19 th September 2003 the Tribunal dismissed his appeal on the basis that:—
"I found neither argument attractive and concluded that they failed to address the kernel of the conviction and the overpayment decision namely that Mr Thompson and Mr Unsworth had claimed a liability to take advantage of the housing benefit scheme. Mr Thompson had failed to persuade the jury that he had not in fact been sharing the property. The trial judge in his sentencing comments stated "During this period, by pretending you were living apart, you dishonestly obtained just under £18,000 from, in effect, the taxpayer." The judge with brevity went to the heart of the issue. For me the question I have to ask is whether there is anything in the papers or in what has been said to me that convinces me on the balance of probabilities that Messrs Thompson and Unsworth were engaged [in] anything other than a scam to take advantage of the Housing Benefit system? I regret not. Indeed in view of the oft recited claims of being resident in his own property when addressing other audiences (such as the electorate) I conclude that even if the burden had been fixed on the Respondent authority [to prove the facts supporting the conviction] I would have found the case established on the balance of probabilities. But living in the same household is not enough. Housing Benefit is payable to resident landlords but why should these two men have pretended to the local authority that the appellant was non-resident? Mr Thompson is clearly an intelligent and articulate man and he had already had experience of being paid as a resident landlord. The only logical conclusion is that it was to further a device to take advantage of the housing benefit scheme. There may have been other reasons. …
I am therefore satisfied that for the period of the overpayment that the evidence overwhelming supports the only conclusion that the arrangement was a device to take advantage of the housing benefit scheme. …
The core issue is whether the letting was a device or not? The weight of the evidence is such that regardless of whom the onus of proof fell upon there is only one conclusion namely that the alleged agreement was a sham to facilitate a scam to take advantage of the housing benefit scheme and the limited monies the local authority seek to recover are recoverable."
The respondent successfully appealed to the Commissioners, the Deputy Commissioner deciding on 29 th April 2004 that :—
"14. The appellant had essentially two arguments. The first argument was that by 1995 he had in fact moved out of the flat so that U [the tenant] was there alone, and there was no overpayment during the period in question. That is a pure question of fact. There is abundant evidence on which the tribunal was entitled to conclude that the appellant was resident in the flat throughout that period, and I can see no error of law in the tribunal's conclusion on this point.
15. The second argument, as developed orally, was that even if he had not moved out, any scam there had been in pretending to have moved out was not relevant to housing benefit. The benefits of moving out, or pretending successfully to have moved out, related (a) to council tax and (b) to the extent to which the rent would be taken into account as income in calculating the appellant's entitlement to income support while he was employed. He pointed out that, as appears from the council's own documents (file, pp.66–75) U had been in receipt of the same amount of housing benefit, £80 per week, while the appellant had been openly living in the flat to the knowledge of the council (see file, p.71) as after he had purported to move out. The council's own council tax records (file p.99) showed him to have been there until 17 July 1992, and this was confirmed by the council's revenue...
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