Benefit fraud

February 19th, 2016 by James Goudie KC in Local Authority Powers

A DWP Consultation, for response by 31 March 2016, seeks views on a revised “Social Security Fraud Act 2001 Code of Practice on Obtaining Information”. The current Code is from 2002.  The Welfare Reform Act 2007 (Sections 46 to 48) extended local authority investigation powers to enable local authorities to investigate and prosecute fraud against certain DWP benefits alongside offences committed against Housing and Council Tax Benefit. These sections commenced in April 2008 and empower local authorities to investigate and prosecute certain DWP benefits providing there is a linked Housing/Council Tax Benefit claim. The required changes have been incorporated into Appendix 3 of the Code.

The Welfare Reform Act 2012 (Sections 122 and 123) extended the definition of social security benefits to include tax credits and child tax credits, for the purposes of Sections 109A (Authorisations for investigators) and Section 109B (Power to require information) of the Administration Act, when investigating benefit offences. These Sections commenced in April 2013, therefore tax credits and child tax credits are treated as social security benefits and are subject to those provisions and the revised Code.

Other amendments due to operational changes in the DWP have been incorporated into the Code, mainly the creation of DWP’s Fraud and Error Service, which will enable a single fraud investigation to be undertaken to investigate all social security benefits, including those currently administered by local authorities and HMRC. The reference to local authority powers in the Code is relevant whilst individual local authorities still have Authorised Officers or investigation staff undertaking social security benefit fraud investigations. Once a local authority benefit investigation team transfers into DWP that local authority will no longer be bound by the Code.

There are changes to the layout of the Code, with the aim of making it clearer and simpler to use. This includes the introduction of five new appendices providing the more detailed information on who can be required to provide information, examples of the type of information that may be requested, when and about whom may Authorised Officers require information, details to be included in requests for information, and contact details

The Code outlines the important safeguards that exist and penalties against misuse of the powers, including confidentiality, security and data retention arrangements, and legal professional privilege.

 

Compulsory Purchase

February 12th, 2016 by James Goudie KC in Land, Goods and Services

In Phoenix Developments v Lancashire County Council [2016] UKUT 38(LC) it was held in the Upper Tribunal (Lands) that the Tribunal had jurisdiction under Section 1 of the Land Compensation Act 1961 to determine compensation for land in Accrington acquired by compulsory purchase from a property development company, notwithstanding that an expert had previously determined a price for the land, under an option agreement.  The Council had entered into an option agreement to purchase land at a price, to be determined by an expert as the market value of the land plus all other sums the landowner would be entitled to if the land was acquired compulsorily.  The Council sought to exercise the option and the expert determined a price.  However, the sale was not completed as the landowner was dissatisfied with the expert’s determination and sought to withdraw.  The Council then acquired the land through the use of its compulsory powers.  The Council submitted that (1) the Tribunal had no jurisdiction to determine the compensation payable for the land, as the expert’s binding determination of the contractual purchase price meant that there was no question of “disputed compensation” capable of being referred to the Tribunal; (2) there was an implied term of the option agreement that any price determination by the expert would remain binding between the parties in the event of compulsory purchase.  Martin Rodger QC, Deputy President, refused the application.  He held that the expert’s determination was irrelevant to the question whether the Tribunal had jurisdiction to entertain the reference.  The land was acquired by the exercise of compulsory powers and there had been no agreement between the parties on the compensation payable in respect of that acquisition.  The expert’s determination had been made for a different purpose.  Even if the price determined by the expert included a sum reflecting statutory compensation, there had been no agreement by the landowner to treat that determination as conclusive of the value of its entitlement. The Deputy President further held that there was no implied term. It was neither necessary nor obvious that the expert’s determination of the contractual purchase price would have been intended by reasonable people in the position of the parties to be determinative also of the claimant’s statutory entitlement in the event of the land being acquired by the exercise of compulsory powers.  It could not be said that the contract would lack commercial or practical coherence without such an implied term.

As to (1), the position was the converse of that in BP Oil UK Ltd v Kent County Council [2003] EWCA Civ 798.  The question in that case was whether an agreement entered into after an acquiring authority had entered and taken possession of land had the effect that the landowner’s statutory entitlement to compensation had become a contractual right to a purchase price which, in default of agreement, was to be determined by the Lands Tribunal applying the statutory compensation code; the question was significant because the reference had been made to the Tribunal after the expiry of the limitation period for a statutory claim arising on the date of entry.  Carnwath LJ, as he then was, observed that the fact that the contractual method of calculating the consideration payable for the land would replicate the method that would apply under the statutory code, “did not deprive the clause of contractual effect” (as the acquiring authority had argued). The Court of Appeal was not dealing with a case such as the present, in which an enforceable contractual right to acquire land at a determined price had been put on one side by the acquiring authority in favour of the exercise of compulsory powers.

As to (2), the Deputy President applied the Supreme Court decision in Marks & Spencer v BNP Paribas Securities (2015) UKSC 72.  A term can be implied only if, without the term, the contract would lack “commercial or practical coherence”.

 

Funding Obligations

February 8th, 2016 by James Goudie KC in Social Care

In Forge Care Homes Ltd v Cardiff & Vale University Health Board, Cardiff City Council and Others [2016] EWCA Civ 26 the Court of Appeal was concerned with the respective funding obligations of local authorities and NHS Local Health Boards with respect to the cost of the provision by registered nurses of nursing care to residents in care homes who require some nursing care, but for whom this is not a primary need.  At issue was the proper construction of Section 49 of the Health and Social Care Act 2001, which is applicable in Wales and England and prohibits local authorities from providing nursing care by a registered nurse.  The case arose in circumstances where the registered nurse recruited by the care home provided both nursing care, in the sense of medical and clinical care, and social care, in the sense of care of a kind which does not depend upon the skill and experience of a registered nurse and can be provided by non-specialist care workers.  The Court of Appeal ruled that a distinction required to be drawn between these two types of services, with the former being paid for by the NHS and the latter by the local authority.  Lord Justice Laws said that it does not follow from the fact that a nurse needs to be on call at all times that everything she or he does on duty has to be treated as a service which needs to be provided by a registered nurse.  What matters is the actual work being done.  The question is as to the various and changing factual circumstances and the extent to which the registered nurse’s activities and individual tasks in the care home need to be provided by a registered nurse.  Lloyd Jones LJ agreed.  Elias LJ dissented.  Therefore the NHS can lawfully set the rate they pay to care homes to reflect time spent, directly or indirectly, on nursing tasks that have to be carried out by a nurse, but excluding time spent on social care.  The latter has to be funded by the care homes or local authorities, or, subject to their means, the residents of the care homes.

 

Exit Payments

February 8th, 2016 by James Goudie KC in Decision making and Contracts

On 5 February 2016 HMG has issued (1) a Consultation Paper on “Limiting Public Sector Exit Payments”, and (2) a Guidance Note on “Public Sector Pay and Terms”.

 

ECHR AIPI

January 29th, 2016 by James Goudie KC in Human Rights and Public Sector Equality Duty

In R (Skelmersdale Limited Partnership) v West Lancashire BC [2016] EWHC 109 (Admin) Jay J summarised the case law as follows: (1) AIPI guarantees in substance the right of property; (2) AIPI comprises three distinct rules; (3) The first, of a general nature, lays down the principle of “peaceful enjoyment of property”; (4) The second covers “deprivation of possessions” and subjects it to certain conditions; (5) The third recognizes that States are entitled, amongst other things, to control the “use of property” in accordance with the “general interest”; (6) The second and third rules, which are concerned with particular instances of interferences with the right to peaceful enjoyment of property are to be construed in the light of the general principle laid down in the first rule; (7) In a deprivation of possessions case, the infringement of the AIPI right will be justified only in “exceptional circumstances”, in the absence of payment of compensation; (8) In a control of use case, the broad question is whether a “fair balance” has been struck between (i) the private interests of the proprietor and (ii) the general public interest; (9) In the event that a fair balance has not been struck without reference to it, the presence or absence of compensation is a relevant factor; (10) The State is allowed a “wide margin of appreciation” in the field of land development and town planning; (11) The issue of “proportionality” is not hard-edged, but requires a broad judgment of where the fair balance lies; (12) The Court will intervene only if the interference is deemed to be “manifestly disproportionate”; and (12) When assessing proportionality under AIPI, a measure is not rendered disproportionate merely by reason of there being a “less intrusive way” of achieving the same objective.

James Goudie QC

 

Liability orders for non-domestic rates

January 29th, 2016 by James Goudie KC in Council Tax and Rates

When is an hereditament “wholly or mainly used for charitable purposes”? In South Kesteven DC v Digital Pipeline Ltd [2016] EWHC 101 (Admin) a Divisional Court set out the following propositions: (1) The test is not whether the activity being conducted on the premises is wholly or mainly charitable; it is whether the premises are being used wholly or mainly for charitable activity.  (2) If, as a matter of fact, the premises are being used wholly or mainly for charitable purpose, it matters not that they could have been run more efficiently or that strictly part only of the premises need have been used; the test has to be applied to the facts as they are, not as they might have been. (3) When determining whether the charitable exemption from rates applies, it is immaterial that the purpose of an arrangement between landlord of business premises and charity tenant is to avoid or reduce the payment of rates.

 

Flood risk management

January 29th, 2016 by James Goudie KC in Environment, Highways and Leisure

In the test case of Robert Lindley Ltd v East Riding of Yorkshire Council (2016) UKUT 6 (LC) a farming company claimed compensation from the Council under Sections 14 and 14A of the Land Drainage Act 1991 after part of its carrot crop was destroyed when floodwater was pumped out of a nearby village.  The Council was lead local flood authority and a risk management authority.  Nonetheless, it submitted that it was not liable, because (1) flood risk management work had to be of a permanent nature and the pumping operation had been temporary and (2) the crop was damaged when the pumping was carried out by the Environment Agency (“the EA”) and the Fire Service.  Both submissions failed.  As to the first, flood risk management work is not limited to permanent work: Paragraph 93.  As to the second, the relevant risk management authorities falling within the Flood and Water Management Act 2010 were the Council (as the lead local flood authority) and the EA.  The Fire Service did not fall within the definition.  As the lead local flood authority, the Council had failed to carry out its duty under the 2010 Act to investigate who were the relevant risk management authorities and whether they were exercising flood risk management functions.  If it had carried out that duty, there might have been less confusion as to what powers were being exercised.  On proper analysis, the EA had been co-operating with and assisting the local authority.  It had provided the pumps in response to the local authority’s request. The local authority had paid for all the pump fuel, including for the period when the EA was on site in the village.  Very little supervision of the pumps had been required other than to ensure they had sufficient fuel.  On those facts, the pumps had been on loan to the local authority from the time they were delivered. The local authority had exercised its powers to carry out the work and was liable for the damage caused.

 

Legal Aid

January 29th, 2016 by James Goudie KC in Judicial Control, Liability and Litigation

To obtain civil legal aid to bring proceedings against a public authority the applicant must show that the proposed action is within the scope of LASPO, the Legal Aid, Sentencing and Punishment of Offenders Act 2012. One provision that may be relied upon is paragraph 1 of Schedule 1. This applies in the case of alleged “abuse by a public authority of its position or powers”.  What this means has been considered by the Court of Appeal in Director of Legal Aid v R (OTA Sunita Sisangia) (2016) EWCA Civ 24.  Sub-paragraph (4) of paragraph 1 was held not to be an exclusive or comprehensive definition.  The fact that the expression cannot be given a hard-edged definition does not mean that the concept itself is meaningless.  Moreover, the ingredients of abuse of power have been expressed in appellate cases, including by the House of Lords in R (Pulhofer) v Hillingdon LBC [1986] AC 484 at 518. “Abuse of position or power” is a recognized judicial concept. Like many other public law concepts, it is “both flexible and context-specific”.

 

PROPORTIONALITY

January 27th, 2016 by James Goudie KC in Judicial Control, Liability and Litigation

The Supreme Court in Samin v Westminster City Council, Mirga v SSWP [2016] UKSC 1, was concerned with the rights of residence in the UK and benefit rights in the UK of “persons from abroad”, specifically EU nationals (from Austria and Poland), pursuant to the Immigration (European Economic Area) Regulations 2006, SI 2006/1003 (“the EEA Regulations”), made under EU Directive 2004/38/EC.  Mr Samin was born in Iraq in 1960. In 1992 he and his family were granted asylum in Austria.  He was granted Austrian citizenship the following year. He then became estranged from his wife and children and came to the UK in December 2005 Since then he has lived in the UK alone.  He is socially isolated.  He suffers from poor mental and physical health.

Mr Samin occupied private accommodation until 2010. He then applied to Westminster City Council (“the Council”) for housing under the homelessness provisions of the Housing Act 1996 (“the Housing Act”).  The Council decided that he was “a person from abroad who is not eligible for housing assistance” within the meaning of Section 185(1) of the Housing Act, because he did not have the right of residence in the UK under EEA Regulations. That decision was affirmed in the Central London County Court, whose decision was in turn upheld by the Court of Appeal.  The Supreme Court unanimously dismissed his appeals.

The Supreme Court held first that the domestic law did not infringe Mr Samin’s EU Treaty rights. It held second (paragraphs 58-70) that there was no lack of proportionality on account of individual consideration not having been given to the individual case.  The important point of principle is that a proportionality exercise is not required in every case where the right of residence and/or the right against discrimination under the EEA Regulations is invoked.

On the same day, 27 January 2016, the Supreme Court also gave Judgment in Youssef v SSFCO [2016] UKSC 3, in which the issues that arose included the standard of review.  Lord Carnwath, giving the Judgment, said, having referred to Kennedy v Information Commissioner [2015] AC 455 and Pham v SSHD [2015] 1 WLR 1591:

“55.      In Keyu v Secretary of State for Foreign and Commonwealth Affairs [2015] UKSC 69; [2015] 3 WLR 1665 (decided since the hearing in this appeal) this court had occasion to consider arguments, in the light of Kennedy and Pham, that this court should authorise a general move from the traditional judicial review tests to one of proportionality. Lord Neuberger (with the agreement of Lord Hughes) thought that the implications could be wide-ranging and “profound in constitutional terms”, and for that reason would require consideration by an enlarged court. There was no dissent from that view in the other judgments. This is a subject which continues to attract intense academic debate …  It is to be hoped that an opportunity can be found in the near future for an authoritative review in this court of the judicial and academic learning on the issue, including relevant comparative material from other common law jurisdictions. Such a review might aim for rather more structured guidance for the lower courts than such imprecise concepts as “anxious scrutiny” and “sliding scales”.

  1. Even in advance of such a comprehensive review of the tests to be applied to administrative decisions generally, there is a measure of support for the use of proportionality as a test in relation to interference with “fundamental” rights (Keyu paras 280-282 per Lord Kerr, para 304 per Lady Hale). Lord Kerr referred to the judgment of Lord Reed in Pham (paras 113, 118-119) where he found support in the authorities for the proposition that:

 “… where Parliament authorises significant interferences with important legal rights, the courts may interpret the legislation as requiring that any such interference should be no greater than is objectively established to be necessary to achieve the legitimate aim of the interference: in substance, a requirement of proportionality.” (para 119)

 See also my own judgment in the same case (para 60), and those Lord Mance (paras 95-98) and Lord Sumption (paras 105-109), discussing the merits of a more flexible approach in judging executive interference with important individual rights, in that case the right to British citizenship.

  1. On the other hand, in many cases, perhaps most, application of a proportionality test is unlikely to lead to a different result from traditional grounds of judicial review. …”

Lord Carnwath further observed, in paragraph 61:

“… Judicial review is a discretionary remedy.  The Court is not required to ignore the appellant’s own conduct, or the extent to which he is the author of his own misfortunes. …”

 

 

Consultation

January 15th, 2016 by James Goudie KC in Decision making and Contracts

The Government has replaced its Code of Practice on Consultation issued in July 2008. The new guidance includes that “consultations should last for a proportionate amount of time”, rather than prima facie for a 12 week period.

 

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