Secretary of State for Work and Pensions v Carmichael and Sefton BC (HB) [2017] UKUT 174 (AAC)
This was the Secretary of State’s appeal to the Upper Tribunal (“UT”) of the First Tier Tribunal’s (“FTT”) decision on the Carmichaels’ “bedroom tax” appeal.
Whilst the appeal only concerned the Carmichaels the UT noted that it was effectively a lead case in a block of some 170 further cases before the UT in England and Wales with a 40 further cases pending in Scotland. It was not known how many similar cases were pending before the FTT.
Background
Mrs Carmichael lived with her husband, Mr Carmichael, in a two-bedroom flat. She had spina bifida, hydrocephalus, double incontinence, inability to weight bear and recurring pressure sores. Mr Carmichael was her full-time carer. She needed a special bed with an electronic mattress. She also needed a wheelchair beside the bed. Her husband could not share the same bed, and there needed to be adequate space for him and nurses to attend to her needs. There was not enough space for him to have a separate bed in the same room. Their rent was previously met in full by Housing Benefit, but it was reduced by 14% under Reg. B13 Housing Benefit Regulations 2006 (SI 2006/213) otherwise known as “the bedroom tax” or “the spare room subsidy” etc.
The FTT decision
On 9th June 2014 the FTT had allowed the Carmichael’s appeal holding that Reg. B13 unfairly discriminated against disabled persons who needed an additional bedroom and that there was no objective and reasonable justification for the discrimination. The FTT judge had read words into the regulations under s.3(1) of the Human Rights Act 1998 in order to avoid a breach of Mr Carmichael’s human rights.
The Judicial Review proceedings
The FTT’s decision had come despite the Court of Appeal’s decision in the unsuccessful judicial review proceedings involving the Carmichael’s:
MA & Ors, R (on the application of) v The Secretary of State for Work and Pensions [2014] EWCA Civ 13.
Since the FTT’s decision the Supreme Court had held that the bedroom tax regulations
were a breach of the Carmichaels’ human rights:
MA & Ors, R (on the application of) v The Secretary of State for Work and Pensions [2016] UKSC 58.
The Supreme Court decision had been handed down on 9th November 2016. On the same day the Department for Work and Pensions had issued local authorities with a ‘Housing Benefit Urgent Bulletin’ advising local authorities that they “must continue to apply the rules when determining Housing Benefit claims as they did before today’s judgment” and that “the Department is considering the Court’s judgment and will take steps to ensure it complies with its terms in due course”
However, it was not until 2nd March 2017 that the Department had laid before Parliament the amending regulations: The Housing Benefit and Universal Credit (Size Criteria) (Miscellaneous Amendments) Regulations 2017 (SI 2017/213).
The UT Appeal
The Secretary of State perused an appeal to the UT on a jurisdictional point: “whether statutory tribunals have the jurisdiction to develop bespoke solutions to Convention violations (discrimination or otherwise) on a case by case basis”. In other words, having found the regulations to amount to a convention violation, was the FTT still bound by them or was it entitled to dis-apply the regulations?
The FTT judge had read words into the regulations under s.3(1) of the Human Rights Act 1998 in order to avoid a breach of Mr Carmichael’s human rights. However, in the UT it was common ground between the parties that that interpretative process had not been open to the FTT, since it went beyond any interpretative reading permitted by section 3(1).
The Secretary of State’s position was that in the period in between a Court identifying a breach of Convention rights by the operation of secondary legislation (such as regulation B13) and Parliament taking steps to rectify that incompatibility then ultimately a claimant’s only recourse to make good the consequential financial loss was to bring civil proceedings in a court for damages under section 8(2) of the 1998 Act.
On the Carmichael’s behalf it was argued that the approach taken in
Mathieson v Secretary of State for Work and Pensions [2015] UKSC 47 should apply. There was no obligation in the primary legislation to make the reduction; rather, the requirement was contained in the secondary legislation.
Mathieson demonstrated that in such circumstances the Tribunal should allow the appeal, set aside the offending decision by the initial decision-maker and substitute a decision that the claimant was entitled to the continued payment of benefit at a rate unaffected by the action which would otherwise be a breach of the claimant’s Convention rights.
Conclusion
The UT concluded that
Mathieson applied and that courts and tribunals ultimately have the power to order that to the extent that subordinate legislation is incompatible with a person’s Convention rights it should not be given effect to in determining the person’s lawful entitlement, or should be otherwise applied or disapplied in a way that does not breach the person’s Convention rights. That course of action was held to be a “relief or remedy” which a court or tribunal may make “within its powers as it considers just and appropriate” under s.8(1) Human Rights Act 1998.
The FTT had arrived at the correct outcome but by the wrong route. The FTT should have directed the local authority to calculate the claimant’s housing benefit entitlement without making a deduction of 14% for under occupancy to avoid an unlawful breach of the Carmichael’s human rights. The result was the same, namely that no deduction operated.
Summary by
Alice Richardson, barrister,
Arden Chambers. For the full judgment
click here.
Southwark LBC v Akhtar and Stel LLC [2017] UKUT 150 (LC), 20 April 2017 (Judge Elizabeth Cooke)
The respondents were long leaseholders of two flats situated within John Kennedy House. The appellant authority owned the freehold of John Kennedy House. The respondents’ leases obliged the appellant to notify the respondents, before the commencement of each year, of a reasonable estimate of the amount which would be payable by the respondents by way of a service charge. Once notified of the estimate the respondents were obliged to pay the appellant in advance on account of service charge the amount of such estimate by equal payments on 1 April, 1 July, 1 October and 1 January in each year. In
Woelke v Southwark LBC [2013] UKUT 349 (LC), the Upper Tribunal held that such notification must include the total expenditure for the forthcoming year, i.e. costs for major works and routine maintenance, as opposed to demanding such sums separately. Notifications did not, however, need to be served before the start of each financial year as time was not of the essence. Moreover, it was open to both Southwark and its lessees to agree to waive strict compliance with the lease by, for example, the lessee taking advantage of a loan from Southwark on favourable payment terms to pay the sum demanded.
In February 2013, the appellant demanded the sum of £40,701.57 from the first respondent in respect of estimated charges for major works for the period April 2012 to March 2015. The demand was broken down into three service charge years: £6,530.05 for 2012/13 (due on 1 April 2013); £31,572.78 for 2013/14 and £2,598.84 for 2014/15. The demand was accompanied by a notification for the year 2013/14, which included both the sum of £31,572,78 and the estimated costs for routine maintenance. In February 2014, the appellant subsequently served the first respondent with a notification that included both the sum of £2,598.84 and the estimated costs of routine maintenance.
The first respondent, on a number of occasions in early 2014, wrote to the appellant and contended that the entire sum was not payable because, amongst other things, it had not been demanded in accordance with the lease. However, after the appellant refused to mediate the dispute, she subsequently agreed to pay the sum in full after she accepted a loan from the appellant, secured against her flat as a charge, for the full amount. The first respondent subsequently applied to the First-tier Tribunal for a determination that the sum was not payable.
The First-tier Tribunal held that the sum was not payable as it had not been demanded in accordance with the lease and that the first respondent had not, by accepting the loan, waived strict compliance of the lease because she had paid under protest.
At a subsequent hearing, the First-tier Tribunal went on to hold, amongst other things, that the first respondent had not received two s.20B(2), Landlord and Tenant Act 1985 notices from the appellant, i.e. notices to inform her that the costs of the major works had been incurred. The First-tier Tribunal held that while s.7, Interpretation Act 1978 applied to the service of notices under Landlord and Tenant Act 1985 (i.e. notices served by post are deemed served unless the contrary is proved), the presumption of service did not apply because the appellant had not proved that the notices had been posted and, in any event, it was satisfied that the presumption was rebutted by the fact that the first respondent had not received the notices. The result of this decision, coupled with the decision that no valid estimated demand had been served, was that the appellant would have been prevented from demanding the costs of any of the works that had been incurred more than 18 months before a final demand was served.
The Upper Tribunal
The Upper Tribunal allowed the appeal.
Compliance with the lease
The sums that were estimated to be incurred for the years 2013/14 and 2014/15 had been demanded in accordance with the lease. Notifications, which included sums for the major works and the routine maintenance, for both years had been served on the first respondent before the commencement of each year. However, the sum of £6,530.05, in respect of the year 2012/13, was not payable. Although time was not of the essence, the lease required the appellant to serve an estimated demand before the last quarter day; once the last quarter day had passed the lease required the appellant to demand payment of the actual service charge. That said, the first respondent had, by accepting a loan from the appellant, waived strict compliance of the lease and so the full sum was payable.
Receipt of s.20B(2) notices
The First-tier Tribunal’s decision that s.7, Interpretation Act 1978 applied to notices served under Landlord and Tenant Act 1985 was an error of law; the Act did not authorise the service of notices by post and as such s.7 did not apply. Nor could the appellant, as a local authority, rely on s.233, Local Government Act 1972 – which permits local authorities to serve notices by post – because that section only applied to notices served by an authority in its capacity as an authority. However, in this instance s.7 did apply because the lease specifically provided that s.196, Law of Property Act 1925, which authorises service of notices by registered post, applied to notices served under the lease (which included the service of s.20B(2) notices).
Moreover, the First-tier Tribunal had been wrong to require proof that every notice had been posted. Evidence that other notices had been received coupled with evidence of the system used by a contractor was sufficient. Finally, the First-tier Tribunal had also been wrong to accept the first respondent’s evidence that she had not in fact received the notices. Her evidence was no more than a bare denial and this was not sufficient to rebut the presumption that the notices had not been served.
Summary by
Sam Madge-Wyld, barrister,
Arden Chambers. For the full judgment
click here.
