[2006] NISSCSC C1_05_06(CRS) (15 March 2006)

Decision No:  C1/05-06(CRS)

SOCIAL SECURITY ADMINISTRATION (NORTHERN IRELAND) ACT 1992

SOCIAL SECURITY (NORTHERN IRELAND) ORDER 1998

COMPENSATION RECOVERY SCHEME

Application by the compensator for leave to appeal
and appeal to a Social Security Commissioner
on a question of law from a Tribunal’s decision
dated 12 November 2004

DECISION OF THE SOCIAL SECURITY COMMISSIONER

1.	This case begins as an application by the Compensator for leave to appeal against the decision dated 12 November 2004 of an appeal tribunal sitting at Belfast.  I grant leave. Both the Compensator and the Department have consented to my treating the application as an appeal and proceeding to determine any issues arising thereon as if they arose on appeal. I therefore do so.  The injured person has not taken any part in the proceedings in relation to this appeal nor has she been represented therein.  As she will not be affected by my decision in this case I have, in exercise of my powers under regulation 5 of the Social Security Commissioners (Procedure) Regulations (Northern Ireland) 1999 decided to make a decision on the appeal without separately seeking any such consent or further representations from the injured person.  She has been kept informed of the various submissions made on the application (which I am now treating as made on the appeal) and she has been given an opportunity to comment thereon but has not done so.

2.	My decision is given in the final paragraph.

3.	The background to this case is that the injured person was injured in an accident on 19 September 2000.  At the time of the accident her husband was working some 20 hours per week and as he was earning low wages the injured person was in receipt of an award of working families tax credit (WFTC).  It appears that there were two children of the family both of whom were of school age.  The injured person was not working at the date of the accident.  

4.	A certificate of recoverable benefits dated 20 January 2003 was issued and this provided for the recovery of income support (IS) paid from 20 September 2000 to 2 October 2002 and disability living allowance (DLA) paid from 9 May 2001 to 7 May 2002.  That certificate was appealed by the Compensator and the tribunal dismissed the appeal.  The Compensator has appealed to me against the tribunal’s decision.  The appeal relates only to IS.  

5.	I have had various written submissions from the Compensator as follows: an OSSC1 form dated 1 April 2005, written submissions dated 30 March 2005 and 18 October 2005, written skeleton argument dated 29 November 2005 and (following a hearing on 14 December 2005) further written submissions dated 29 December 2005 and 1 February 2006.  I have also had the benefit of written argument from the Department as follows: submissions dated 15 July 2005, written skeleton argument dated 22 November 2005 and (following the said hearing) written submissions dated 30 December 2005. The Department has been represented throughout by Mrs McGrath of its Decision Making Services branch and the Compensator by Mr Philips of Counsel instructed by Messrs Murphy & O’Rawe, Solicitors.  I am grateful to both representatives for their very considerable assistance in this matter.

6.	I do not propose to set out in detail the written submissions.  As further information became available to the Compensator concerning the facts of this case those submissions have changed somewhat. I therefore have concentrated on the main point of the Compensator’s argument.  This was that the tribunal had failed to consider either adequately or at all whether the injured person’s husband’s stopping work could constitute a novus actus interveniens.  The Compensator, relying on decision C11/99-00(CRS) submitted that intervening factors could relieve a compensator of his liability to repay benefits.  It submitted that the husband stopping work was such an intervening act and as such relieved the Compensator of any liability for benefits which were properly attributable to him so doing.  This, it was argued, was the entirety of the IS.  The Compensator submitted that the tribunal had a duty to investigate and was in breach of its inquisitorial role in not investigating whether the Department had any evidence that the husband was required to give up work due to the wife’s injuries.  In the Compensator’s submission this was an obvious issue, particularly when it had been made clear to the tribunal that the reason for applying for IS was because the husband had given up work due to his wife’s injuries. 

7.	The Department opposed the appeal.  It submitted that the injured person satisfied the conditions of entitlement to IS and that it was properly paid to her.  The Department submitted further that she satisfied all the conditions of entitlement because she was incapable of work.  As regards the question of whether it was reasonable for the injured person’s husband to give up employment, this was not a matter which the IS decision-maker had to consider.  The tribunal did not consider whether the conditions of entitlement to IS were met nor was it required to do so.  For purposes of the compensation recovery scheme (CRS) the tribunal was required to establish if IS was payable as a result of the accident.  The injured person had been awarded IS on the basis of her incapacity.  It would not have been awarded had she not made a claim for incapacity benefit (IB).  In the Department’s submission, as it was established that the injured person was incapacitated as a result of the relevant accident, IS was properly payable as a result of that accident.  The Department submitted further that the injured person received IS for the family unit by virtue of the fact that she was incapacitated as a result of the relevant accident and not as a result of her husband giving up employment.

	Reasons

8.	The tribunal did not, as both parties have acknowledged, investigate whether it was reasonable for the injured person’s husband to give up work.  The Compensator has argued that this giving up work was a novus actus interveniens.  I am dubious that concepts such as this can be directly imported into the CRS.  The Scheme is essentially for the purpose of enabling the Department to recover benefits which the Department has had to pay as a result of the relevant accident or injury.  It does not involve concepts from the law of negligence. The legal position is that for benefit to be recoverable the relevant accident or injury does not have to be the sole cause of the payment of benefit but it must be an effective cause (R(CR)1/01).  

9.	The fact that the conditions for entitlement to a benefit are satisfied is not determinative of whether the payment of benefit was attributable to the relevant accident.  The case of Eagle Star Insurance v The Department for Social Development [12 February 2001] Northern Ireland Court of Appeal is authority for this proposition.  It may be necessary to go behind whether or not the conditions are satisfied and ascertain why they are satisfied as part of the determination of whether the benefit was paid other than in consequence of the injury.  For benefit to be paid in consequence of an accident, injury or disease, it must be an effective cause, not merely part of the background circumstances against which the benefit was awarded.

10.	The Compensator is correct in that the injured person, had her husband remained in work, would not have been entitled to IS even though she suffered the accident.  It is also correct, as both parties acknowledge, that the tribunal did not investigate whether the husband’s leaving work was a reasonable decision.  It is my view that the standard of reasonableness is all that is required and indeed it has not been argued before me that there is any other standard.  It is true that this family would not have received IS had the injured person not been incapable of work but that does not of itself necessarily mean that her incapacity was a cause of the receipt of the IS.  It appears to me that the immediate cause was the husband leaving work. This deprived the family of his wages and subsequently of WFTC.  An initial small amount of IS and (once the WFTC award ended) a bigger amount of IS was paid.  The tribunal appeared to conclude that as the injured person would not have been able to claim IS had she been capable of work her incapacity (which it justifiably concluded was as a result of the accident) was an effective cause of the payment of IS.  I think it was not entitled to this conclusion.  The incapacity was, it is true, one of the conditions which had to be satisfied for entitlement to IS.  However that does not necessarily mean that the accident etc was an effective or operative cause.  Rather it was in the nature of causa sine qua non ie the benefit would not have been paid had she not been incapable but the incapacity did not of itself cause the payment of IS.  Had her husband not given up work no IS would have been awarded.  Had he not remained unavailable for work the award would not have continued.  It was his ceasing and being unavailable for work which were the reasons why IS was paid.  

11.	The Compensator has submitted that the giving up work was a novus actus interveniens.  I have already indicated above that there are considerable dangers in endeavouring to import such concepts (at least directly) into the CRS.  The giving up work may be a new act but if that giving up work was necessary because of the accident then benefit paid because of the giving up work could not be said to be paid “otherwise than in respect of the accident”.  (Article 13 – Social Security (Recovery of Benefits) (Northern Ireland) Order 1997.  Similarly with regard to the husband remaining unavailable for work.  The tribunal did not investigate these matters.

12.	Was there a failure of the tribunal’s inquisitorial role in not so doing?  Mr Mearns who appeared for the Compensator at the tribunal had raised the issue.  He stated that the injured person and her husband had calculated that they would get more money if he was not working and if she claimed.  He stated further that it would be unfair on the Compensator to be bound by her decision to claim benefit.  I should state that part of Mr Mearns’ argument is somewhat misconceived in that a injured person does not owe any duty to the compensator not to claim benefit to which she is properly entitled simply for purposes of minimising the amount of benefit recoverable by the state from the compensator.  That is not minimising her loss vis a vis the Compensator.  It is minimising the amount which the Compensator would be required to repay to the state. Recovery of compensation is not a matter which is covered by any duty on a victim to mitigate his loss vis a vis the wrongdoer.  An injured person is entitled to claim any benefits to which he or she is entitled.  Neither that injured person nor his or her partner owes any duty to the compensator to refrain from claiming any such benefit nor to make an election as to which of them should claim so as to minimise recoverable benefit.  

13.	Mr Mearns’ argument revealed a mistake as to fact which, in my view, should have been apparent to the tribunal.  Mr Mearns, because the certificate of recoverable benefits did not supply reasons for the increase in IS, formed the opinion that the sudden increase in IS was an increase for the injured person’s spouse and dependants.  That is not correct.  The increase was because the WFTC award came to an end so that the family financial resources reduced. This matter was mentioned in the Department’s supplementary submission to the tribunal at paragraph 8 where it clearly states:

	“I would point out that the income support increase at 29.12.2000 was due to the fact that Working Families Tax Credit ended on 26.12.2000.  If this had not been in payment [the injured person] would have been entitled to the higher amount of income support from her date of claim.  [The injured person] was claiming the Working Families Tax Credit as her husband was working 20 hours per week.”

14.	Mr Mearns was sent a copy of this submission and he responded by stating:

	“It confirms our suspicions that benefits were increased for spouse and dependants.”

	That was a wrong conclusion for Mr Mearns to draw though it is perhaps understandable to those not intimately acquainted with the benefits system.  It would have been, at least, good practice for the tribunal to have pointed that out to Mr Mearns.  I make no comment as to whether the tribunal’s not doing so was an error of law.  

15.	As indicated above Mr Mearns had argued to the tribunal that the couple had “calculated they’d get more money if he wasn’t working and if she claimed.”  I have dealt with that argument above.  However, against the evidential background and the submissions made I consider that there was a failure of the tribunal’s inquisitorial role and that the decision was in error of law because of it.  The tribunal should have considered whether the injured party’s husband was required to give up his employment to be at home and caring for his children because his wife was incapable of so doing as a result of the accident.  There are several questions which should have been considered in relation thereto:

(1)	whether the injured party was incapable of looking after the children as a result of the relevant accident and if so for how long;
(2)	whether it was a reasonable decision for the husband to give up his employment to do so;
(3)	whether, and if so for how long, it was reasonable for him to remain unavailable for work because his wife was incapable of looking after the children as a result of the relevant accident.

16.	I set the tribunal’s decision aside for failing to consider these matters and I remit the matter to a differently constituted tribunal with directions that it does so.  The burden of proof in these cases has been described as “neutral” (C7/99(CRS) and C2/96(CRS)).  I direct the Department to supply to the tribunal such evidence as is within its provenance relevant to the determination of the questions indicated above.  In the end what must be shown is that benefit was paid otherwise than in respect of the relevant accident or injury.  In other words that the accident or injury was not an effective cause of the payment of the benefit.  If that is not shown the appeal cannot succeed.

17.	One matter remains.  I mentioned earlier having received written submissions in a letter dated 1 February 2006.  These were from Mr Mearns.  They protested that the Department had in its submissions on 30 December 2005 contradicted the submissions it made at hearing.  It also stated that the Compensator did not consent to the matter being fully determined on the papers as they now stand.  Whether or not a further hearing is necessary is not a matter for consent.  If a Commissioner considers an appeal can properly be determined without a hearing, the Commissioner can so rule whether or not the parties consent.  I do not consider that a further hearing is required.  I also think Mr Mearns is somewhat confused where he refers to Mr Hanna’s supplemental submission.   That was a submission to the tribunal not to me.

18.	There are several conditions which must be satisfied before a person can be awarded IS and they can vary according to that person’s circumstances.  In this case for the injured person to be awarded IS she had to satisfy both incapacity for work and financial conditions.  That is what the Department referred to in its submissions and I have dealt with the matter above.

19.	The Compensator wins its appeal.  The matter is remitted to a differently constituted tribunal with the directions set out above.

(signed):  Moya F Brown

Commissioner

15 March 2006