I'm livid! And I don't know where to turn to

Long story, but basically what I need help with is:
Is social fund entitled to refuse a crisis loan EXCLUSIVELY because the person has failed the HRT for ESA? He's a British citizen and we are appealing the ESA decision.

Where does it say in the law that they can't award the crisis loan if the HRT has been failed? I read CPAG and it says that if the person has a reasonable chance of acquiring Habitual Residence in the future, then they should pay. Well he has been here a month already and the Council has re-housed him under homelessness legislation. He has passed the HRT for HB and CTB already.

The most ridiculuos thing I heard today was the Crisis Loan supervisor telling me that if he didn't like their decision then he had to HAND DELIVER a note saying he wasn't happy about it to the Cambridge Jobcentre Plus which is 10 miles away and client has no transport and no money for bus! They would not accept a fax or anything else! Has anyone come across this before?