What is a’Step’ for Sch 10

Just want to try this one out!

My cl owns a half share of the house they live in and half share of another property that was bought as a buy to let.

The other half of both properties is owned by the cl’s partner

They have separated and my cl has no income or savings but the value of the buy to let appears to be being counted as capital and stopping the UC claim being paid.

My first thought was that if the buy to let was for sale then it would not be counted.

Unfortunately this did not chime with my Cl’s plan. They want to sell the house they live in and use their half share of the ‘profits’ to buy their ex partner’s share of the buy to let and make that their home.

Is it stretching the definition of ‘Steps’ in para 4 (1) (b) of sch 10 to describe selling the house that the cl currently lives in as a ‘step’- if so this would possibly allow the value of the buy to let to be ignored for a reasonable period and the cl to get some UC in the meanwhile

(4.—(1) Premises that a person intends to occupy as their home where—

(b)the person is taking steps to obtain possession and has commenced those steps within the past 6 months;)

There is a defining sub-paragraph at 4(2) which tells us that “a person is to be taken to have commenced steps to obtain possession of premises on the date that legal advice is first sought or proceedings are commenced, whichever is earlier.”

I think this is to be read as exhaustive, so that a person is only to be taken as having commenced steps if one or both of those conditions apply, rather than them just being set out as some possible steps which might be taken. This is in contrast with measures which talk about ‘reasonable steps’ which allow a wider view.

So, your client would need to have either sought legal advice or to have commenced proceedings to engage the disregard. Your client has not ‘commenced proceedings’ on any view. They don’t seem to have taken legal advice. So the disregard wouldn’t seem to apply.

What if your client were to sit down with a lawyer and ask them whether their plan was feasible? Would that then engage the disregard?

I would think that it is implicit that the legal advice would need to relate fairly directly to proposed proceedings to recover possession, as opposed to being about a longer term plan of which recovering possession is one eventual objective, but who is to say.

Thanks for the reply, there is, unfortunately, a great deal more to this case than my post indicates, it was just a precis for the single issue. The cl has had some legal advice but this didn’t really add much to the discussion and they cannot afford any more solicitors fees.

My enquiry was (and I concede that it is a long shot) whether the sale of the house they live in would count as a step towards purchasing the buy to let house, in other words as soon as the first house was up for sale would Sch 10 be engaged. I gather that the sale of both houses was something that both parties solicitors advised on.

In practice I don’t think the cl is going to pursue this- as I said the case is very complex and somewhere in the background there is a Compliance process rumbling on and I dont think the cl wants to take any further steps until this is resolved