B e f o r e :
THE HONOURABLE MR JUSTICE NEWMAN
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THE QUEEN ON THE APPLICATION OF MOIRAM BIBI
| Claimant
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| | ROCHDALE METROPOLITAN BOROUGH COUNCIL HOUSING BENEFIT REVIEW BOARD
| Defendant
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(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 190 Fleet Street
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Miss J Harris (instructed by Rochdale Law Centre for the Claimant)
Miss J Boyd (instructed by the Defendant)
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HTML VERSION OF JUDGMENT
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Mr Justice Newman :
- The claimant, Moiram Bibi, challenges a decision dated 6 November 2000 of the Housing Benefit Review Board for Rochdale Metropolitan Borough Council. The challenge raises three issues:
(1) whether the Board applied the correct law in force to the application;
(2) whether the Board acted unreasonably in finding that the claimant was not liable to make payments in respect of her dwelling house because the tenancy was not on “a commercial basis”; and
(3) whether the claimant’s right to a fair hearing under Article 6 of the Human Rights Act 1998 (HRA) was breached.
- On 18 January 1999 the claimant completed her application for housing benefit which was received by the defendant on 20 January 1999. On 25 January 1999 the Housing Benefit (General) Amendment (No.2) Regulations 1998 (S.I. 1998 No.3257) (the Regulations), came into force. Paragraph 3 of the Regulations amended regulation 7 of the Housing Benefit Regulations to provide as follows:
“(1) A person who is liable to make payments in respect of a dwelling shall be treated as if he were not so liable where -
(a) the tenancy or other agreement pursuant to which he occupies the dwelling is not on a commercial basis;
................”
Other amendments, not related to this case, were also implemented. The fundamental distinction between the above and the previous Regulations is that no longer need it be shown that the claimant is residing with the landlord.
- Paragraph 1(3) of the Regulations provides:
“Where a claimant is in receipt of an award of housing benefit on 25 January 1999, these Regulations shall come into force in respect of that individual on the day after the last day of the benefit period in respect of which that award is made.
On 22 April 1999 the local authority determined the claimant’s application for benefit as follows:
(1) an entitlement to benefit for the period 4 January 1999 to 25 April 1999 in a total award of £880.00.
(2) an entitlement to benefit from 26 April 1999 to 3 January 2000 at a weekly rate of £55.
By letters dated 25 September and 27 September 1999 the defendant informed the claimant that the entitlement was ended and that as a result the payments made for the period from 4 January 1999 to date were overpayments and it claimed £2035.00. The Housing Services Department stated:
“I have looked at the circumstances of the claim and taken into consideration all the information that you have supplied.
Regrettably I must advise you I am of the opinion that you do not have a legally binding rent liability.
Therefore, in accordance with Section 130 of the Social Security Contributions and Benefits Act 1992, I am unable to award Housing Benefit.”
This decision was reviewed and after review was maintained. The claimant appealed the determination to the Review Board, which delivered its decision on 6 November 2000. The Board was requested to set aside its decision. It declined to do so for the reasons given in a decision dated 6 February 200l.
Issue 1
- It is obvious that the purpose of Paragraph 3 of the Regulations is to protect the rights of those persons who have been granted benefit under the Regulations prior to their amendment, for a period extending beyond the commencement date of the amended Regulations. Their rights are unaffected even if under the amended provisions they would not be entitled to benefit. The legislative purpose of the amendment was not to deprive persons of their accrued rights but for the provisions to apply to all determinations of right to benefit reached after 25 January 1999 for any period after 25 January 1999. In the case of Nicholson v Leeds City Council Housing Benefit Review Board (Transcript: 2 November 2000), Smith J so held. In that case a request for review of a refusal to award benefit dated 18 December 1998 was made on 25 February 1999. The Review Board hearing did not take place until December 1999. The Review Board applied the law applicable after 25 January 1999 to the whole period it had to consider. The judge held that the Review Board should have applied the law which governed at the period for which consideration for entitlement was being sought (paragraph 44). Contrary to the suggestion in the editorial note in the Supplement to CPAG’s Housing Benefit and Council Tax Benefit Legislation 2000/2001 (p.11), Smith J did not decide that “as the claim was made prior to the amendments, the old law had to be applied”.
- Miss Harris, counsel for the claimant, attempted to distinguish this case from Nicholson. She submitted that since an award had been made on 22 April 1999 which was backdated to 4 January 1999, “the claimant was .... in receipt of an award .... on 25 January 1999 ....” and therefore the unamended Regulations applied to her award. In Nicholson no award had been made. In my judgment the argument is plainly wrong. After the date when the amended provisions came into force there was no power in the local authority to make an award for a period after 25 January 1999 in accordance with the previous law. At the date when the Housing Benefits Department considered the claimant’s application it had to apply the law in force for the period for which it was considering the claimant’s entitlement to benefit. Having regard to the actual determination and the periods of entitlement it must be in doubt whether the correct approach was adopted but since it is the Review Board’s decision with which we are concerned, that is irrelevant to this application for judicial review. The withdrawal or termination of benefit was upheld by the Review Board by the application of the law which came into effect after 25 January 1999, which the Board applied to the claim for entitlement from 4 January 1999 to 24 January 1999 as well as to the period after 25 January 1999. In this last respect, but only in that respect, the Board was plainly wrong, for the claimant was entitled to have and the Board was obliged to apply, the law in force prior to amendment to that part of the claim. That said, this application for judicial review is not directed to that error in connection with that period. It can be noted that in the reasons given for refusing to set aside the decision, the Review Board stated, in apparent recognition of the error,
“The Review Board concluded that if they had had jurisdiction to do so, they would have set aside the decision to the extent that it related to the period 4th to 24th January 1999 and passed it to a differently constituted Review Board to determine.”
The possibility, as suggested by Miss Harris, that a local authority could deliberately delay pending applications so as to achieve an advantage can make no difference to the fundamental position. In this instance, since the date of the claim was so proximate to the change in the law, no ground for suggesting an abuse can arise.
Issue 2
- The Review Board concluded that “ ... the tenancy agreement was not on a commercial basis”. In summary the Board found the following facts:
(1) the claimant entered into a tenancy agreement with her daughter who lived abroad, the rent being £90 per week;
(2) the claimant had stated, in the course of a visit by the New Claims Officer on 12 March 1999, that she had moved into the house (5 Fitton Street) on 21 December 1998, having previously lived at 73 South Street. At that time she acted as agent for her daughter in connection with the house. Her son became the agent when she moved into the house;
(3) thereafter there were unsuccessful visits to the property by the defendant’s representatives but on 17 May 1999 the claimant had stated that she lived at the property with her defendant daughter. She stated her husband was the owner of 73 South Street and she did not know whether there was a mortgage on 5 Fitton Street;
(4) examination of the contents at 5 Fitton Street revealed, among other things, a weight lifting bench belonging to the claimant’s son, and no clothes belonging to the claimant or her daughter in the bedroom she stated she occupied with her daughter, only a shoe rack containing men’s shoes. There was nothing in the bathroom but a bottle of bleach;
(5) subsequent inquiries revealed that the claimant was the joint owner of 73 South Street, was still included on the electoral register as residing at 73 South Street, and had made an application to a bank from 73 South Street in November 1998;
(6) the claimant promised to submit, but failed to supply, utility bills for 5 Fitton Street.
- The Review Board concluded in these terms:
“The Review Board noted the conflict of evidence about storage of clothes. After listening to the evidence they accepted the evidence of Mr Khawaja that despite direct questions no reference had been made to the drawers under the bed.
The Review Board noted that a rent book had not been submitted in support of the appeal and accepted the assertion by Miss Mansley that it had not been produced during the processing and investigation of the benefit claim.
The Review Board noted the references to the occupation arising from the owner[’s] being abroad for a period of two years and that occupation had arisen at the instigation of Mrs Bibi.
The Review Board noted that there had been no possession proceedings despite accumulation of rent arrears (which could not be quantified in the absence of a rent book).
In the light of the above, the Review Board concluded that the tenancy agreement was not on a commercial basis.”
- In a witness statement dated 3 August 2001, the Chairman of the panel comprising the Board, Mr Greenwood, stated that the Board were “ ... particularly persuaded by four factors”.
“ ..... firstly, that it appeared to the Council upon a visit to the property that the Claimant was not in occupation at the property. In addition observations were made that the landlady’s husband and the Claimant’s son retained items on the property. Secondly, the Review Board was concerned that despite the Claimant stating that she would produce a rent book, that had not been carried out. Thirdly, that the Claimant’s occupation arose because her landlady was no longer in the country. The Board held particular concerns over the fact that the Claimant did not consult anyone over moving into the property but simply allowed herself into it with a key she already had. Finally, the Board noted that despite an inevitable accumulation of rent arrears there had been no action taken by the landlady.”
- Miss Harris relied upon the case of R v Greenwich LBC ex parte Dhadly 32 HLR 829. In that case the Review Board was held to have failed to have properly understood the legal issues in that it had failed to demonstrate whether it reached its conclusion by the application of Section 130 Social Security Contributions and Benefits Act 1992 or by the application of Regulation 7(1)(b) of the Regulations. She submitted the Board in this instance had failed to apply the right test. Further, relying upon R v Solihull MBCHB Review Board ex parte Simpson 26 HLR 370, she submitted inadequate reasons had been given for the decision. It was, she submitted, incumbent upon the Board to explain why it had “ ... drawn the adverse inference rather than a more benign one” (see Simpson p.379).
- Regulation 7(1)(L) provides that a person shall be treated as if he were not liable to make payments in respect of a dwelling house where “ .... the appropriate authority is satisfied that the liability was created to take advantage of the housing benefit scheme established under Part VII of the Contributions and Benefits Act”. This paragraph is the successor to Regulation 7((1)(b) which fell for consideration in the case of Simpson. It is apparent from the cases that in many instances the facts available may give rise to an issue under Section 130 and or Regulation 6 and or Regulation 7(1)(a) and or Regulation 7(1)(L). In this case there can be no doubt that the Review Board appreciated that it was only concerned with the application of Regulation 7(1)(a), namely whether the tenancy agreement was “on a commercial basis”. The burden was on the authority to establish it was not on a commercial basis and it was for the Board to be satisfied on the balance of probabilities that the principal basis on which the agreement was made was not a commercial one. The terms of the decision of the Review Board do not disclose the test applied by it but the statement of Mr Greenwood is as follows:
“The Review Board felt that the Council has discharged the burden of proof placed upon it insofar as it had to convince the Review Board, on the basis of the evidence before it, that this tenancy agreement was not on a commercial basis.”
In my judgment the decision should have clearly disclosed that which Mr Greenwood has now stated to have been the approach of the Review Board. This is more than a requirement for a fomulaic incantation. By expressing conclusions by reference to the correct test there will be increased confidence that the assessment of the facts has been in accordance with a rational and deliberative process. In some cases the facts may be insufficiently clear and lack the necessary cogency to speak for the conclusion reached. If no due deliberative process is revealed, the court will be likely to quash the decision.
- The factors relevant to assessing whether an agreement has been reached on a commercial basis are not defined nor closed but the assessment must include all the circumstances surrounding the agreement and the relationship of the parties. Miss Harris did not dispute that the following matters were relevant to the assessment: the absence of a rent book, the fact that occupation had arisen at the instigation of the claimant, who at the material time was agent for the property, who then entered the property to occupy it without consultation; and the absence of possession proceedings. She submitted undue weight had been accorded to them. Further, she submitted that an apparent lack of occupation had been given great weight when it should have been regarded as irrelevant. Particular complaint was made about the insufficiency of the evidence in connection with a bank application from 73 South Street and the general lack of weight which was attached to the explanations which had been provided by the claimant and her son to the New Claims Officer.
- As to credibility and weight, the claimant and her daughter attended the hearing but did not give evidence on the assertion made on her behalf that no reference had been made to clothes on the occasion of the visit to the house. Mr Khawaja did give evidence, which was accepted, which contradicted part of the case for the claimant. This was but one point in connection with the issue of non occupation. In my judgment the issue of occupation was not irrelevant to the question to be decided by the Review Board. Persons do not normally enter into legally binding commercial agreements where there is no clear need to achieve the object conferred by the agreement. Nor do people who have entered into a commercial agreement normally conduct themselves so as to take little or no advantage under the agreement. The Review Board was entitled to weigh and consider the evidence of the difficulty in locating the claimant at the property and the absence of telling evidence that she occupied the property. Apart from her presence there for the purpose of a meeting, there was little evidence. These matters were capable of supporting a conclusion that the agreement she had entered into was convenient to her, insofar as she might have wanted to have the property available to her, and were capable of contradicting the conclusion that the principal basis of the agreement was a commercial one. As to these matters the explanation proffered by the claimant that she had lived in London and visited elsewhere was not to the point. The Board were entitled to conclude that she had made no appreciable or significant use of the property and to include it with the other factors in assessing whether the agreement was on a commercial basis.
- Having set out all the facts which it found established, the majority being those in relation to non occupation, it listed the particular matters which persuaded it to conclude:
“In the light of the above, the Review Board concluded that the tenancy agreement was not on a commercial basis.”
I am satisfied from the manner and construction of the decision, in particular the care with which the detail of the respective cases was rehearsed, that the Review Board had clearly in mind the nature of the task it had to perform. Where there was a conflict it resolved the dispute. It identified particular factors to which it attached weight. It stated that, “in the light of the above ...”, it had reached its conclusion. In my judgment there was sufficient evidence before the Board entitling it to reach the conclusion to which it came and I am not persuaded that it concluded that it was convinced by the evidence without realising where the burden lay and without applying the required standard of proof. For completeness I should add that I accept the uncertainty surrounding the document pointing to a bank transaction being entered into from 73 South Street but am satisfied that it played no significant part in the decision.
- As to the reasons challenge, I do not regard the distinction between the adverse and benign inference as directly in point. The task of the Board was to come to the conclusion of fact, namely whether the agreement was “on a commercial basis” or not, such conclusion being neither “adverse” nor “benign” in the sense used in the cases. Although some of the facts were in issue, the absence of a rent book, the circumstances of entry to the property, the absence of possession proceedings and limited occupation of the property, were not in issue. In such a case as this the real question is whether there was sufficient evidence to justify the conclusion reached by the Board. The inference, which comprises the conclusion, is either a reasonable reflection of the facts or not and is not pejorative.
Issue 3
- The Review Board hearing is dated 6 November 2000 and the HRA was then in force. It has not been suggested that article 6 of the European Convention for the Protection of Human Rights (“the Convention”) was not engaged by the hearing. Plainly a determination as to whether an entitlement to housing benefit exists constitutes a determination of a civil right protected by article 6(1) of the Convention.
- Prior to 2 July 2001, Schedule 7 to the Housing Benefit (General) Regulations 1987 provided that where a local authority were the appropriate authority, the composition of the Board was to be councillors of that Authority. From 2 July 2001 Review boards have been abolished and replaced by appeal tribunals comprising members, chosen from a panel constituted by the Lord Chancellor, who will be independent of local authorities. (See Child Support, Pensions and Social and Security Act 2000, Social Security Act 1988, Sections 4 to 7 and the Housing Benefit and Council Tax Benefit (Decisions and Appeals) and Discretionary Financial Assistance (Consequential Amendments and Revocations) Regulations 2001 Schedule 2 Part 2). It has not been suggested that the appointment of local councillors to sit as members of the Review Board does not undermine the appearance of independence and impartiality contemplated by article 6(1) of the Convention. Nor can it be disputed, having regard to Section 6(2)(a) of the HRA, and the legislative system governing the Review Board, that “the authority could not have acted differently” and therefore did not act unlawfully.
- As a result the point taken by Miss Harris is that the court must apply the Convention, for to do otherwise would be unlawful (Sections 6(1) and 3(a) of the HRA). I agree. If the decision sought to be impugned has been reached in breach of the claimant’s rights under article 6(1) of the Convention this court must so find. The issue therefore is whether there has been a violation of article 6.
- Neither counsel, rightly in my judgment, considered it necessary to develop submissions on this issue but rather preferred to lay the relevant considerations before the court by reference to two particular cases: Bewry v Norwich City Council (Moses J, 31 July 2001); McLellan v Bracknell Forest Borough Council and others and Secretary of State for Transport Local Government and the Regions (CA transcript l6 October 2001). Additionally it can be said that proper consideration of the issue requires close attention to be paid to Alconbury Developments Ltd and others v Secretary of State for the Environment Transport and the Regions [2001] 2 WLR 1389.
- The following principles, which are relevant to this case and give rise to no issue, can be distilled from the cases.
(1) The “determination” referred to in article 6 “ .... refers not only to the particular process of the making of the decision but extends more widely to the whole process which leads up to the final resolution”. (Lord Clyde in Alconbury, paragraph 152 page 1435). It follows that whether article 6 has been breached in this instance depends upon the adequacy of the court’s powers upon this judicial review.
(2) Although the Strasbourg jurisprudence includes the expression, requiring the subsequent control to be by a “judicial body that has full jurisdiction”, the expression does not mean that an exhaustive and comprehensive review on the merits must be available.
“it is necessary to have regard to matters such as the subject matter of the decision appealed against, the manner in which that decision was arrived at, and the content of the dispute, including the desired and actual grounds of appeal”. (Mr N. Bratza in Bryan v UK 21 EHRR 342 as approved and adopted in Alconbury).
In McLellan (paragraph 89) Waller LJ summarised the result as follows:
“ .... in considering whether judicial review, plus the procedures, are article 6 compliant:
1. it is relevant whether findings of fact are material to the decision;
2. if findings of fact are material to the decision, that will not finally determine whether judicial review provides a remedy in compliance with article 6;
3. if the facts themselves have been found by “an expert tribunal” sufficiently independent to make it unnecessary for the court to have a broad jurisdiction to review those decisions of fact that is likely to lead to the conclusion that judicial review is sufficient.”
- The jurisdiction exercised by all Review Boards was subject to established procedures (see The Housing Benefit (General) Regulations 1987). The Department of Social Security Good Practice Guide included a recommendation that the authorities should ensure “ ... that a Review Board is made up of people who have not previously been involved in the case, and who do not have an interest in the outcome”. Where practical it was suggested that no councillor should hear a case involving a claimant from his or her ward. Nor should any member have a vested interest in the outcome. The Guide also laid down requirements for procedural fairness at the hearing. There is no suggestion that a breach of any provision of the Guide or breach of procedure or breach of the common law principles of natural justice has occurred. The challenge is made upon the basis that the Review Board, being composed of councillors, are to be regarded as judges in their own cause on behalf of the local authority who are a party to the dispute.
- In the case of Bewry, Moses J had to consider whether judicial review was adequate to cure a decision of a Rent Review Board where it had refused a claim on the grounds that the documentation and circumstances surrounding the claim were “unreliable”. It is plain that the benefit claim in Bewry was rejected because the Board was not satisfied the claim was genuine. At the heart of the case lay an issue of credibility. Moses J concluded that, in the circumstances of the case before him, the “ .... lack of independence” had infected the independence of judgment in relation to the finding of primary fact in a manner which “could not be adequately scrutinised or rectified by this court” and that the level of review available “could not replenish the want of independence in the Review Board caused by the connection to a party to the dispute”.
- Bewry was cited to the Court of Appeal in McLellan. Waller LJ stated:
“In Bewry v Norwich City Council (Transcript 31 July 2001) Moses J seems to have held that a decision of the Review Board under the Housing Benefit (General) Regulations 1987 was invalid at common law on the basis that only primary legislation could authorise a body to be judge in its own cause. I am not sure that this is right.”
The Lord Justice went on to review the position before the advent into force of the HRA and concluded:
“It would not have been enough to argue that albeit constituted strictly in accordance with the Regulations, the review body would be perceived as a judge in its own cause making all decisions void.”
Counsel informed the court that Bewry was on appeal to the Court of Appeal and was likely to be heard in January 2002. Both counsel resisted the suggestion that judgment in this application should await the outcome of that appeal. In all the circumstances I concluded that it would not be right to adjourn the hearing.
- It is unnecessary for this court to express a view on the reasoning of Moses J which led him to conclude that the right of access to a determination of the Housing Benefit Review Board was “ ... akin to the right of access to a court” and carried with it a right to review by a Board which was constitutionally independent and impartial as required by article 6. There has been no argument addressed to the issue because in the instant case the Convention is in play.
- In Alconbury an Inspector in a planning matter, subsequently called in by the Secretary of State, was held to lack independence in applying policy but to be independent in the fact finding process. Since policy was not for the court and the court controlled the fairness of the fact finding procedure by its judicial review jurisdiction the provisions were held to be compatible with article 6 of the Convention.
- In the present case the Review Board comprising councillors found the facts. The decision being reviewed had been reached by the Housing Services Department under delegated powers exercised for and on behalf of the authority, which decision was being subjected to internal review by councillors acting as the authority. In my judgment they cannot be regarded as independent or expert in the sense employed in Alconbury. The character of the decision making in this case and in Alconbury is so dissimilar that one is bound to conclude that the result in Alconbury is no pointer to the answer in this case. The case of McLellan is, however, more in point. The decision to end an introductory tenancy upon notice to the tenant triggers a right for the tenant to require an internal review. The decision to seek possession must be supported by reasons and the machinery provides for reviewing the reasons. Further, there is no material distinction between the procedural safeguards to ensure a fair review under the Regulations in connection with introductory tenancies and the procedures laid down for a review by a Housing Benefit Review Board.
- At paragraphs 96-103, Waller LJ applied what he had concluded were the relevant considerations (see paragraph 19 above) to the regime for introductory tenancies, which can be expressed as giving rise to the following points of general relevance. I would summarise them as follows.
(1). Material facts which can be established with certainty are unlikely to give rise to difficulty on judicial review.
(2). If the reasonableness of the conduct of the local authority is in issue that is pre-eminently a matter for judicial review.
(3). It should not be assumed that a decision cannot be taken at a senior level of the council reviewing the decisions already reached by less senior people. Further, the availability of judicial review to check the legality and fairness of the decision must be taken into consideration.
- I turn, in the light of the above, to the considerations affecting the challenged decision of the Review Board.
(1). The decision involved finding facts. There was an issue whether the claimant had been asked about clothing. The Review Board found, after hearing evidence from the authority that she had been asked about clothing. It should be noted that the claimant had not suggested that she had mentioned clothes being in drawers. Her case was that she had not been asked about clothing. Having concluded that she had been asked, the absence of any reference to them being in drawers was not contentious but it served to heighten the impact of the conclusion on the contested fact. Apart from this the facts relied upon by the Review Board were not substantially in issue and therefore can be regarded as having been established with some certainty.
(2). Although it can be said that an issue of credibility arose the following aspects should be borne in mind. The claimant could have given evidence on the issue. The written case for the authority was detailed:
“Mrs Bibi was asked where she kept her clothes. She showed the officers a few items of clothing in a wall unit in the living room. She also showed them some clothes on the washing line. The officers noted that there was no clothing small enough to fit her young daughter.”
To this the claimant’s response was, through her representative:
“Razia claims that the visiting officers did not ask about clothing.”
Further, as I have already observed, this area of fact was but one aspect of the facts pointing to non-occupation of the property.
(3). The decision required of the Review Board was not whether the claimant had been party to an abuse of the regime, nor whether she had lied or been guilty of any misconduct. The Board was required to come to a conclusion of fact, namely whether or not the agreement had been reached on a commercial basis. The Board by the individual members, the councillors, cannot be said to have had a personal interest in finding that the agreement was not on a commercial basis. As councillors performing a public duty I see no reason to conclude that they were acting otherwise than to ensure so far as they could that the local authority fulfilled its statutory obligation to award benefit where the law required it. To approach the matter otherwise seems to me to involve imputing a desire on the part of the councillors to avoid paying benefit because it might save the authority money even though the law required it to be paid.
(4). Where a number of uncontested facts have been found and a challenge is made to the conclusion reached on the basis of those facts, this court is able to conclude, as it has already under Issue 2, whether the facts can reasonably support the conclusion. If they do I can see no sound basis for concluding that the appearance of a lack of independence and impartiality has given rise to a violation of article 6.
- Since Miss Harris relied upon the case of Bewry I should, for completeness, return to the case. As I read the judgment, Moses J, being faced with a case which turned on credibility and a finding of “unreliability”, encompassing a likelihood of some measure of impropriety on the part of the claimant, felt unable to discern “ ... the often imperceptible effects of the influence of the connection between the fact finding body and a party to the dispute” which he considered could have “infected” the judgment of fact (see paragraphs 62-64). On the facts of the present case I see no cause to conclude that “infection” has occurred, because I cannot see that the connection between the councillors and the authority, in this case, constituted a source of infection.
For the above reasons this application for judicial review is dismissed.
