R(IS) 4/93
Mr. J. Mesher CIS/107/1991
30.6.92
Claim – failure to provide evidence in support of a claim – whether an independent ground for disentitlement
Tribunal practice – duty to record findings – whether it is permissible to adopt an adjudication officer's statement of findings
On a claim form for income support dated 30 January 1990 the claimant declared that he had no capital assets. However, he had sold the house he had previously lived in for £29,000 in January 1989.
The adjudication officer disallowed the claim on the grounds that the claimant had failed to provide sufficient evidence about the amount of capital received and how he had disposed of it. The claimant's appeal to a tribunal was dismissed. The claimant appealed to the Commissioner.
Held that:
- it is not always necessary for tribunals to record specific findings of fact. Tribunals can adopt a statement of facts from the adjudication officer's submission, especially where matters are not in dispute. However, this approach is only acceptable if;
(i) what is incorporated in the tribunal's findings is a statement of conclusions on disputes of fact and;
(ii) that statement, where it constitutes the sole recorded findings, includes all the relevant matters on which findings are necessary (para. 11);
- the need for verification of information provided by the claimant does not, in itself, justify a delay in the submission of the claim to an adjudication officer. Once the Secretary of State makes that submission, it is irrelevant whether or not the claimant has satisfied regulation 7(1) of the Social Security (Claims and Payments) Regulations or provided enough information for the Secretary of State to refer the claim to the adjudication officer since those issues are for the Secretary of State to decide. The adjudication officer's duty is to consider the claim and, so far as practicable, dispose of it within 14 days of its submission. But adjudication officers may make further investigations or ask for more evidence. Alternatively, they may determine the claim on the evidence currently available, especially when the claimant has had a reasonable opportunity of producing the required information or evidence. R v. Secretary of State for Social Services and another, ex parte CPAG and others [1990] 2 QB 540, applied (para. 13);
- it is not of itself a ground of disentitlement to IS that a claimant has failed to provide sufficient evidence to support his claim. However, the essential elements of entitlement must be considered in the light of the evidence available. If a claimant is thought by the AO to have provided insufficient evidence on a relevant issue, where the burden of proof is on the claimant to make out his claim, that issue should be decided against the claimant (para. 14).
The appeal was allowed.
DECISION OF THE SOCIAL SECURITY COMMISSIONER
- The claimant's appeal is allowed. The decision of the Cardiff social security appeal tribunal dated 3 September 1990 is erroneous in point of law, for the reasons given below, and I set it aside. The appeal is referred to a differently constituted social security appeal tribunal for decision in accordance with the directions given in paragraphs 16 to 21 below (Social Security Act 1975, section 101(5)).
The background
- On 30 January 1990 a claim for income support from 22 January 1990 was received from the claimant. On the B1 claim form he declared that he had no capital, but that he had sold the house which he had previously lived in for £29,000 in January 1989. An officer of the Department of Social Security interviewed the claimant on 12 February 1990. It appears that at that interview, the claimant produced the completion statement dated 10 March 1989 prepared by his solicitors, showing the proceeds of sale of the house, after the redemption of the mortgage and fees, to be £13,698.90. The claimant produced bank statements covering the period from 14 March 1989 to 19 January 1990 from the TSB Bank. The account was opened by the deposit of a cheque for £13,698.90. He also produced a receipt for a payment of a fine of £135 on 17 July 1989. Copies of these documents are in the appeal papers. A copy of the record of that interview is not in the papers, but according to the adjudication officer's written submission to the appeal tribunal, the claimant gave information about expenditure for a number of purposes.
- On 21 February 1990, the claimant produced a receipt for the purchase of a car on 24 March 1989 for £4,000 and an undated note confirming receipt of a wedding gift of £2,000. Copies of these documents are in the appeal papers. The claimant was interviewed again on 27 February 1990. Again, no copy of the record of this interview is in the appeal papers, although apparently it was read out to the appeal tribunal on 3 September 1990.
- The officer of the Department of Social Security was not satisfied with the information provided by the claimant and, acting on behalf of the Secretary of State for Social Security, decided that the claimant had failed to satisfy regulation 7(1) of the Social Security (Claims and Payments) Regulations 1987. That regulation provides:
"Every person who makes a claim for benefit shall furnish such certificates, documents, information and evidence in connection with the claim, or any question arising out of it, as may be required by the Secretary of State and shall do so within one month of being required to do so or such longer period as the Secretary of State may consider reasonable."
- The claim was then evidently submitted to an adjudication officer under section 98(1) of the Social Security Act 1975, because on 14 March 1990 the adjudication officer made the following decision:
"The claimant has failed to provide sufficient evidence as to the amount of capital held and as to the disposal and need to dispose of capital that was held. The claimant is not entitled to income support until each (clearly a slip for "such") time as he provides satisfactory proof to the above to support his claim."
- The claimant appealed. Following one adjournment, when the claimant had replied that he could not attend on the particular date because he was travelling to London to look for work, the appeal was heard by the appeal tribunal on 3 September 1990. The claimant was not present, apparently having given no reason for not attending.
- The adjudication officer's written submission supported the decision of 14 March 1990. Paragraph 6.4 of form AT2 is as follows:
"I submit that the questions for determination by the tribunal are as follows:
(a) Has the claimant furnished sufficient information and evidence for the Secretary of State to refer his claim to the adjudication officer to determine his entitlement to benefit? [The claimant] has been unable to provide adequate and satisfactory evidence to account for £14,697.57 of his expenditure.
(b) Has the claimant been given the opportunity to provide this evidence?
[The claimant] has been told on several occasions exactly what evidence and information was required. (The claimant) was invited to attend two interviews at the office on 12 February 1990 and 27 February 1990 at which he was unable to provide any additional evidence to clarify or support the information he had already given on his account of the expenditure."
After setting out the roles of the Secretary of State and the adjudicating authorities, the submission continues (in para. 6.6):
"If the tribunal should decide that the claimant has provided sufficient information and evidence to support his claim they should go on to determine his entitlement in accordance with the following guidance."
The rest of the submission was concerned with the determination of the amount of the claimant's capital. It took the line that the claimant had total capital of £21,532.57 in the period from 10 March 1989 to 30 January 1990 (proceeds of sale of house, £13,698.90; earnings, £7,490.32; other, £343.35). The adjudication officer accepted that expenditure of £6,835 (as detailed in a schedule) was accounted for, leaving a balance of £14,697.57 unaccounted for. He submitted that the claimant had deprived himself of this resource for the purpose of securing entitlement to income support, so that he should be treated as still possessing it under regulation 51(1) of the Income Support (General) Regulations 1987.
- At the hearing, the presenting officer, representing the adjudication officer, pointed out that the written submission ignored the claimant's expenditure on living expenses, especially in the five months for which he was in work. She suggested that he might reasonably claim to have spent his earnings on living expenses in that period, and then to have spent £6,863 on living expenses in the following five months of unemployment, in addition to the accepted expenditure of £6,835.
The appeal tribunal's decision
- The appeal tribunal disallowed the claimant's appeal. Their findings of fact were:
"1. The facts set out in paragraph 5 (Summary of Facts) of form AT2 were found to be correct.
- The claimant has indicated that evidence of repayment of a loan of £3,000 cannot be provided because the payee was abroad."
In their reasons, the appeal tribunal rejected the presenting officer's suggestions as being contrary to the explanation of large items of expenditure by the claimant (in particular, the wedding gift of £2,000 and the repayment of the loan of £3,000), evidence of which was inadequate.
- The claimant applied for leave to appeal to the social security Commissioner, which was granted by another Commissioner on 9 April 1991. The adjudication officer now concerned with the appeal, in the submission dated 10 May 1991, supports the claimant's appeal on two grounds. The first is that it is not sufficient to satisfy regulation 25(2)(b) of the Social Security (Adjudication) Regulations 1986 for an appeal tribunal to record findings of fact by reference to form AT2. The second is that the appeal tribunal did not address the question of the purpose of the deprivation of resources.
- I do not accept either of those grounds in the form in which they are put. As will emerge below, I consider that the appeal tribunal failed to deal with the relevant issues in a more fundamental sense. I do not accept that it is always necessary for an appeal tribunal to record specific findings of fact. Sometimes it can save unnecessary repetition, especially where matters are not in dispute, for an appeal tribunal to adopt a statement of facts from the adjudication officer's written submission. But there are at least two important qualifications. The first is that this approach is only acceptable if what is incorporated by reference into the appeal tribunal's findings is a statement of conclusions of fact. Where, as here, the summary of facts on form AT2 sets out the history of the claim and the claimant's contentions, but does not indicate conclusions on disputes of fact, incorporation by reference is inadequate. The principle that the appeal tribunal must record findings on material matters and not merely record contentions or statements (see para. 6 of R(SB) 42/84) must be applied. The second qualification is that the incorporation by reference is adequate in itself only if it includes all the relevant matters on which findings are necessary. Here, the appeal tribunal's findings were deficient on this count as well.
- The reason why those findings were inadequate appears to be that the appeal tribunal was misled by the form of the adjudication officer's decision and by the written submission on his behalf, which I have summarised in paragraph 7 above. That submission suggested that the appeal tribunal should consider whether the claimant had furnished sufficient information and evidence for the Secretary of State to refer his claim to the adjudication officer and only go on to consider his substantive entitlement to benefit if satisfied on the first point. That represents a misunderstanding of the operation of regulation 7(1) of the Claims and Payments Regulations and of the principle for which R(SB) 29/83 (cited in the written submission) stands. It should be observed that R(SB) 29/83 was decided in relation to a form of the legislation which is slightly different to that currently in force. In particular, the then benefit officer's obligation to determine questions referred to him was made expressly subject to the satisfaction of the predecessor of regulation 7(1) of the Claims and Payments Regulations (see reg. 2(3) of the Supplementary Benefit (Determination of Questions) Regulations 1980). There is now no such provision in section 99(1) of the Social Security Act 1975. In addition, the most authoritative statement of the division of functions between the Secretary of State and the adjudication officer in the consideration of claims is contained in the judgment of the Court of Appeal in R v. Secretary of State for Social Services and another, Ex parte Child Poverty Action Group and others [1990] 2 QB 540. R(SB) 29/83 must be read in that light.
- It is arguable that in this case, according to the principles laid down in the Child Poverty Action Group case, the claim should have been submitted to the adjudication officer, under section 98(1) of the Social Security Act 1975, earlier than it was, because what was being sought from 12 February 1990 onwards was essentially verification of information provided by the claimant. The Court of Appeal observes (at (1990) 2 QB 553) that while "it might be reasonable for there to be verification, the need for verification by itself does not justify delay in the submission of the claim (to the adjudication officer). If verification is to delay the determination, it is the responsibility of the adjudication officer to put in motion such further inquiries as are required for that purpose." However, it is not necessary to pursue this point because it appears that the claim was submitted to the adjudication officer on 13 or 14 March 1990. The claim is submitted under section 98(1) "for determination". Once such a submission is made, it is simply irrelevant whether or not the claimant has satisfied the Secretary of State under regulation 7(1) of the Claims and Payments Regulations or whether or not the claimant has furnished sufficient information for the Secretary of State to refer the claim to the adjudication officer. Those matters are entirely for the Secretary of State (see para. 11 of R(SB) 29/83). Once the claim is submitted to him under section 98(1), the adjudication officer's duty is to take it into consideration and, so far as practicable, dispose of it within 14 days of its submission (Social Security Act 1975, section 99(1)). As decided by the Court of Appeal in the passage quoted above, the adjudication officer has the power to make further investigations or call for further evidence before determining the claim. Or he may determine the claim on the evidence currently available, especially if he considers that the claimant has already had a reasonable opportunity of producing the required information or evidence.
- Here, the adjudication officer did determine the claim in his decision of 14 March 1990, but he did not do so on adequate grounds. If a claimant is thought by the adjudication officer to have provided insufficient evidence on a relevant issue, where the burden of proof is on the claimant to make out his claim, that issue should be decided against the claimant. Thus, here, since the adjudication officer considered that the claimant had provided insufficient evidence to show that his actual and notional capital was within the then current limit of £6,000, he should have determined the amount of actual and notional capital which the claimant possessed and determined that he was not entitled to income support by reason of section 22(6) of the Social Security Act 1986, which applies the capital limit. It is not in itself a ground of disentitlement to income support that a claimant has failed to provide sufficient evidence to support his claim. But the result of such a failure will be that he fails to prove some essential element of entitlement. That, in a sense, is the sanction behind regulation 7(1) of the Claims and Payments Regulations. The adjudication officer and appeal tribunals must consider the essential elements of entitlement directly. That, in my view, is what the Commissioner meant in paragraph 13 of R(SB) 29/83 when he said that the benefit officer must give a decision on a claim. He goes on to refer to this being "the only fair way to bring in issue a question as to whether or not a benefit officer has sufficient information and whether, having regard to the information which he has, the decision he has given is correct". But that passage does not suggest that a claim can be disallowed on the independent ground of insufficiency of information. The essential elements of entitlement must be considered directly in the light of the evidence available and the burden of proof on the claimant.
- The appeal tribunal here, apparently because they concentrated on the question of the adequacy of the evidence presented, did not make any findings of fact on the amounts of actual or notional capital which the claimant possessed. This seems to be the only matter in which the claimant's entitlement was in doubt. They therefore failed to make findings on questions of material fact, as they were required to do by regulation 25(2)(b) of the Adjudication Regulations. That is an error of law which requires me to set the decision of 3 September 1990 aside. Because of the complexity of the factual and legal issues involved, the appeal must be reheard by a differently constituted social security appeal tribunal.
Directions on the rehearing of the appeal
- In view of the reasons why I have found the decision of the appeal tribunal dated 3 September 1990 to have been erroneous in point of law it would be desirable for a fresh written submission to be prepared on behalf of the adjudication officer before the rehearing, dealing in particular with the issues mentioned in paragraphs 17 to 21.
- The new tribunal must first determine how much actual capital the claimant was in possession of in the period from 10 March 1989 onwards. In considering the sums paid to the claimant by way of earnings, the new tribunal should bear in mind that savings out of past earnings constitute capital (see R(SB) 2/83 and R(SB) 35/83).
- The new tribunal must then determine whether the claimant has proved that by the date of claim he was no longer in possession of that capital (see R(SB) 38/85). I draw the new tribunal's attention in particular to the following passage in paragraph 18 of that decision:
"The claimant says that he expended (the) sum of £18,700 in repaying loans. It is for him to prove that this is so. Failing a satisfactory account of the way in which the money has been disposed of, it will be open to the tribunal, and a natural conclusion, to find that the claimant still has, in some form or other, that resource and consequently to conclude that his actual resources are above the prescribed limit."
- If the new tribunal decides that the claimant did dispose of amounts of actual capital, they must consider whether he has deprived himself of that capital for the purpose of securing entitlement to income support or increasing the amount of that benefit (Income Support (General) Regulations 1987, reg. 51(1)). The new tribunal may find the following Commissioner's decisions particularly helpful: R(SB) 38/85, R(SB) 40/85, R(SB) 9/91 and R(SB) 12/91.
- The new tribunal may also need to consider paragraph 10 of Schedule 10 to the Income Support (General) Regulations on the value of personal possessions and R(IS) 1/91 on the diminishing notional capital rule.
- In considering all these issues, the new tribunal must take into account all the documentary evidence, including the documents produced by the claimant after 3 September 1990, and any oral evidence given by the claimant at the rehearing. It would be helpful for copies of the records of the interviews with the claimant on 12 February 1990 and 27 February 1990 to be provided to the new tribunal and the claimant. The assessment of the weight to be given to various elements of the evidence, especially where there might appear to be contradictions or inconsistencies, is entirely a matter for the new tribunal. The fact that the claimant has succeeded in this appeal to the Commissioner does not carry any implication one way or the other as to what the decision on his claim should be.
Conclusion
- The claimant's appeal is allowed.
Date: 30 June 1992 (signed) Mr. J. Mesher Deputy Commissioner
