NK CCS 387 2009
| Jurisdiction | UK Non-devolved |
| Judge | Judge C. Turnbull |
| Judgment Date | 12 November 2009 |
| Neutral Citation | 2009 UKUT 231 AAC |
| Subject Matter | Child support |
| Respondent | CMEC |
| Court | Upper Tribunal (Administrative Appeals Chamber) |
| Docket Number | CCS 387 2009 |
| Appellant | NK |
IN THE UPPER TRIBUNAL Appeal Nos. CCS/387/2009
ADMINISTRATIVE APPEALS CHAMBER CCS/703/2009
- This is an appeal by the non-resident parent (Mr K) against two decisions of an appeal tribunal sitting at Brighton on 18 August 2008. For the reasons set out below those decisions were in my judgment wrong in law and I set them aside. In exercise of the powers in section 12 of the Tribunals, Courts and Enforcement Act 2007 I make the findings of fact set out below and re-make the Tribunal’s decisions. The decisions which I substitute are as follows
In respect of the appeal under tribunal reference 177/07/02475 (CCS/387/2009)
Miss P’s appeal against the decision of the Secretary of State made on 9 August 2007 is allowed. The maintenance calculation is varied under Regulation 20 of the Child Support (Variations) Regulations 2000. The liability of Mr K to pay maintenance in respect of his daughter Mia is assessed at £72.45 per week from 28 July 2006. That sum is arrived at by the following calculation:
£644 per week (total cost of lifestyle) x 75% (3 relevant children) x 15% (1 qualifying child) = £72.45.
In respect of the appeal under tribunal reference 177/07/02471 (CCS/703/2009)
Miss P’s appeal against the decision of the Secretary of State made on 28 November 2007 is allowed. The maintenance calculation is varied under Regulation 20 of the Child Support (Variations) Regulations 2000. The liability of Mr K to pay maintenance in respect of his daughter Mia is assessed at £94.71 per week from 2 February 2007 down to 25 July 2007. That sum is arrived at by the following calculation:
£753 per week (total cost of lifestyle) x 75% (3 relevant children) x 15% (1 qualifying child) = £94.71
- Mr K and the parent with care (Miss P) lived together between 1992 and 1996 (p.140 of CCS/703/2009) and have a daughter, Mia, who is now aged 14, and who lives with Miss P. Mr K lives with a new partner (Miss C), by whom he has three children, now aged about 7, 5 and 3
- On 4 May 2005 child support maintenance payable by Mr K in respect of Mia was calculated at £29.14 per week from 4 March 2005.
- On 1 August 2006 Miss P applied for the subsisting maintenance calculation to be superseded on the grounds that Mr K no longer had shared care and that she wished a variation on the grounds (inter alia) that Mr K had assets and that his lifestyle was inconsistent with his declared income.
- On 2 August 2006 a decision was made, by way of supersession, increasing the maintenance calculation to £34 per week from 28 July 2006, on the ground that the shared care allowance no longer applied.
- On 8 February 2007 Mr K applied for a supersession of that assessment on the grounds of change of circumstances, namely that he had 3 children living in his household and that his income had reduced.
- As from 25 July 2007 Mr K was in receipt of working tax credit (p.33 of CCS/703/2009). No variation could therefore have effect in respect of a period after that date: s.28F(3) of the Child Support Act 1991; reg 30(a) and 7(5)(b) of the Child Support (Variations) Regulations 2000. Section 28F(3) of the 1991 Act provides that “the Secretary of State shall not agree to a variation” in specified circumstances, one of which (in the case of a variation on the ground of assets or lifestyle in excess of declared income) is that, at the date on which the variation would take effect, the non-resident parent is “in receipt of working tax credit.” It is in my judgment implicit in that provision that a variation should cease to have effect if there is an award of working tax credit.
- On 9 August 2007:
(1) A decision was made refusing the variation application which Miss P had made on 1 August 2006. That was the first decision under appeal to the Tribunal.
(2) A further decision was made superseding the maintenance calculation, on the grounds for which Mr K had applied on 8 February 2007, and reducing it to nil from 2 February 2007.
- On 31 August 2007 Miss P appealed against the decisions of 9 August 2007. The appeal against the supersession decision was treated as a further application by Miss P for a variation.
- On 28 November 2007 a decision was made refusing that variation application. Miss P also appealed against that decision. That was the second decision under appeal to the Tribunal.
- On 18 February 2008 a hearing of the tribunal took place, at which both Mr K and Miss P appeared and gave evidence, but the hearing was adjourned so that further information could be supplied.
- On 28 May 2008 a further hearing took place at which Miss P appeared and gave evidence, but Mr K did not. It was again adjourned, in order to give Mr K a further opportunity to produce evidence which the Tribunal considered to be necessary, and for the provision of which it made detailed Directions.
- The final hearing took place on 18 August 2008, at which again Miss P appeared, and Mr K did not.
- It was common ground that, if a variation were to be made on the applications which Miss P made, the effective dates of the variations would be 28 July 2006 in respect of the first application and 2 February 2007 in respect of the second application.
- The Tribunal allowed Miss P’s appeals. On both applications it directed a variation on the grounds of assets (reg. 18 of the Child Support (Variations) Regulations 2000) and lifestyle inconsistent with declared income (reg. 20).
- As regards assets, it decided that as at 28 July 2006 Mr K owned (as it is common ground that he did) a property which I shall refer to as no. 60 C Drive, which it valued at £330,000, less a mortgage of £257,000, giving equity of £73,000. It decided that as at 2 February 2007 he owned no. 60, with that same net value, and in addition 2 properties which I shall refer to as nos. 1 and 2 O Walk, with a net value of £294,000 in total. That made total relevant net assets of £367,000 as at 2 February 2007. Applying the statutory rate of 8% to those figures gave deemed income from assets of £112 per week as at 28 July 2006 and £564 per week as at 2 February 2007.
- As regards lifestyle inconsistent with declared income, the Tribunal decided as follows:
As at 28 July 2006
It considered that the total income necessary to support Mr K’s lifestyle, as itemised on a schedule which it prepared, was £1012 per week, from which it deducted £80 per week in respect of Miss C’s income and £288 per week rent received from No. 60 C Drive, making a total cost of lifestyle of £644 per week, which was very substantially in excess of the income on which the maintenance calculation from 4 March 2005 had been based (£228.04)
As at 2 February 2007
The Tribunal started with the same itemised figure of £1012 per week, to which it added £151 per week in respect of an MBNA personal loan and £280 per week in respect of a mortgage with Skipton Building Society. From those figures it deducted sums of £80 per week in respect of his partner’s income, £288 per week rent received in respect of no 60 C Drive and £322 per week from capital which it considered was used to support lifestyle, giving a total cost of his lifestyle of £753 per week.
- The Tribunal therefore directed a variation as from 28 July 2006 on the basis of income of £112 per week (assets) plus £644 per week (lifestyle), giving a total of £756 per week. It calculated the revised maintenance calculation on that basis as £85 per week.
- The Tribunal directed a variation as from 2 February 2007 on the basis of income of £564 per week (assets) plus £753 per week (lifestyle), giving a total of £1317 per week. It calculated the revised maintenance calculation on that basis as £148 per week.
- In my judgment the Tribunal’s decision was wrong in law in at least the following respects, which I set out first in summary form:
(1) It failed sufficiently to indicate that it had weighed the relevant evidence relating to the value of no. 60 C Drive;
(2) It did not consider whether nos. 1 and/or 2 O Walk were prevented from being included as assets for variation purposes on the ground that they were assets of a business and/or assets which Mr K was retaining for a reasonable purpose.
(3) The Tribunal in any event adopted what appears to have been an incorrect method of calculating the net equity in these two properties.
(4) The Tribunal further in my judgment needed to consider the position as at dates later than February 2007, because there were changes which occurred after that date, but at dates which it had jurisdiction to consider.
- It is helpful first to consider the dates which the Tribunal had jurisdiction to consider.
- As regards the decision of 9 August 2007 refusing the variation application...
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