Michael Hooper v Secretary of State for Work and Pensions
| Jurisdiction | England & Wales |
| Judge | Lord Justice Thomas,Lord Justice Ward |
| Judgment Date | 24 May 2007 |
| Neutral Citation | [2007] EWCA Civ 495 |
| Date | 24 May 2007 |
| Docket Number | Case No: C3/2006/2227/SSTRF |
| Court | Court of Appeal (Civil Division) |
[2007] EWCA Civ 495
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM A SOCIAL SECURITY COMMISSIONER
Mr Commissioner Jacobs
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Ward
Lord Justice Dyson and
Lord Justice Thomas
Case No: C3/2006/2227/SSTRF
Mr Simon Cox (instructed by Messrs Will Rolt) for the Appellant
Mr Martin Chamberlain (instructed by Solicitor for Department for Work and Pensions) for the Respondent
Hearing dates: 03 May 2007
Dyson LJ:
Introduction
This appeal raises two issues of law arising from the incapacity benefit legislation. They arise from decisions by the Secretary of State for Work and Pensions (“SSWP”) (i) to supersede an award of incapacity benefit to the appellant for the period 9 September 2002 to 20 April 2004 and replace it with a decision that there was no entitlement to incapacity benefit for that period, and (ii) that an overpayment of incapacity benefit in the sum of £6989.77 is recoverable from the appellant. These decisions were upheld by an appeal tribunal whose decision was in turn upheld by Mr Commissioner Jacobs. The appellant appeals with the permission of Sir Henry Brooke. Before I come to the statutory framework and the issues in more detail, I need to summarise the facts.
The facts
The appellant is 49 years of age. At the age of 8, he was injured in a road traffic accident, as a result of which he suffered significant brain damage. He was unemployed, and on 4 June 1987, a decision was taken under the then applicable legislation to award him invalidity benefit. In 1995, the invalidity benefit regime was replaced by a new regime by the Social Security (Incapacity for Work) Act 1994 (“the 1994 Act”). This introduced a new Part XIIA into the Social Security Contributions and Benefits Act 1992 and replaced invalidity benefit with incapacity benefit. Under the Social Security (Incapacity for Work) (Transitional) Regulations 1995 (“the Transitional Regulations”), an award of invalidity benefit took effect as an award of incapacity benefit. Central to the new regime was the “personal capability assessment”. On 22 August 1997, a personal capability assessment was carried out of the appellant. It was determined that he was incapable of work.
Until 2002, there were only limited circumstances in which claimants could continue to receive benefit while working. In April 2002, new rules for working while receiving benefit came into force. Work which did not disentitle a claimant from receiving benefit was “exempt work”: see regulation 17(1) of the Social Security (Incapacity for Work) Regulations 1995 (“the 1995 Regulations”). These rules required the claimant to notify the SSWP within 42 days of starting work.
In March 2002, the SSWP sent to all recipients of incapacity benefit a “factsheet” in which they explained the effect of the “new permitted work rules to be introduced from 8 April 2002”, i.e. exempt work that a claimant would be permitted to do without loss of entitlement to incapacity benefit. After describing what work would be permitted, the document contains a section headed “how does permitted work affect my benefit?” It states that “permitted work will not affect your incapacity benefit” and then:
“You will no longer need to get a doctor to agree that the work will help your medical condition, but you should tell the office that deals with your benefit before you start work. You should fill in an application form before you do any permitted work.”
The appellant received a copy of this factsheet. He read it and put it away. He was unemployed at the time. On 9 September 2002, however, he started employment as a school cleaner. He worked in that capacity for 13 hours per week until 20 April 2004. He was paid more than £20 per week. He did not complete the application form that had been referred to in the factsheet before he started his employment or at any time. He did not notify the SSWP either orally or in writing that he was working.
He stopped working on 20 April 2004. On 26 May 2004, his incapacity benefit was suspended. On 7 August 2004, the SSWP made a decision superseding the award that had been made on 4 June 1987 on the grounds that between 9 September 2002 and 20 April 2004, he had been doing work which was not exempt within the meaning of regulation 17 of the 1995 Regulations. The supersession decision was that the appellant was not entitled to incapacity benefit for that period. On 13 August 2004, the SSWP made a decision that the appellant had been overpaid £6989.77 and that this sum was recoverable from him because, in breach of regulation 32(1) of the Social Security (Claims and Payments) Regulations 1987 (“the 1987 Regulations”), he had failed to notify the SSWP of the fact that he had started working within 42 days of the day on which his work began.
On 14 September, the appellant gave notice of appeal against both the supersession and the overpayment decisions. On 18 October 2004, following a reconsideration, the SSWP maintained both decisions. In the reasons for this decision, the SSWP said that it was reasonable to expect the appellant to have disclosed the fact that he was working so that the overpayment “remains recoverable”. The supersession decision was not dealt with.
As I have said, the decisions of 7 and 13 August 2004 were upheld by the tribunal and the appeal from the tribunal's decision was dismissed by the commissioner.
The statutory framework
The substantive rules in relation to incapacity benefit which are material to this appeal are to be found in regulation 17 of the 1995 Regulations which defines “exempt work”. It is unnecessary to set these out. It is sufficient to note that, as I have said, one of these rules is that the claimant notify the SSWP within 42 days of starting work that he has started work.
Decision-making and appeals are governed by the Social Security Act 1998 (“the 1998 Act”) and the Social Security and Child Support (Decisions and Appeals) Regulations 1999 (“1999 Regulations”). An indefinite award of incapacity benefit is not automatically terminated from the date that conditions of entitlement are no longer met. The ways in which an award can be altered are prescribed by detailed statutory provisions.
Where a change of circumstances has occurred, section 10 of the 1998 Act gives the SSWP the power to “supersede” the award. Section 10 also provides:
“(5) Subject to subsection (6) and section 27 below, a decision under this section shall take effect as from the date on which it is made or, where applicable, the date on which the application was made.
(6) Regulations may provide that, in prescribed cases or circumstances, a decision under this section shall take effect as from such other date as may be prescribed.”
Thus the general rule is that a supersession takes effect from the date on which the decision to supersede is made. The prescribed exceptions are set out in regulation 7 of the 1999 Regulations. So far as relevant, regulation 7 at the material time provided:
“7. – (1)
(b) This regulation contains exceptions to the provisions of section 10(5) as to the date from which a decision under section 10 which supersedes an earlier decision is to take effect.
(2) Where a decision under section 10 is made on the ground that there has been … a relevant change of circumstances since the decision had effect or, in the case of an advance award, since the decision was made, the decision under section 10 shall take effect –
…
(c) where the decision is not advantageous to the claimant—
….
(ii) in the case of a disability benefit decision, or an incapacity benefit decision where there has been an incapacity determination (whether before of after the decision), where the Secretary of State is satisfied that in relation to a disability determination embodied in or necessary to the disability benefit decision, or the incapacity determination, the claimant or payee failed to notify an appropriate office of a change of circumstances which regulations under the Administration Act required him to notify, and the claimant or payee, as the case may be, knew or could reasonably have been expected to know that the change of circumstances should have been notified,
(aa) from the date on which the claimant or payee, as the case may be, ought to have notified the change of circumstances, or
(bb) if more than one change has taken place between the date from which the decision to be superseded took effect and the date of the superseding decision, from the date on which the first change ought to have been notified, or
(iii) in any other case, except in the case of a decision which supersedes a disability benefit decision, or an incapacity benefit decision where there has been an incapacity determination (whether before or after the decision), from the date of the change.”
Regulation 7A(1) provides so far as material:
“7A. – (1) For the purposes of regulations … 7(2)(c) and (5)—
…
“incapacity benefit decision” means a decision to award a relevant benefit or relevant credit embodied in or necessary to which is a determination that a person is or is to be treated as incapable of work under Part XIIA of the Contributions and Benefits Act,
“incapacity determination” means a determination whether a person is incapable of work by applying the personal capability assessment in regulation 24 of the Social Security (Incapacity for Work) (General) Regulations 1995 or whether a person is to be treated as incapable of work in accordance with regulation 10...
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