Renting from family

I would be wary about giving advice regarding this matter.

It seems the risk would be the claim getting disallowed because the tenancy could be construed as being created to take advantage of the housing benefit scheme.

You would have to show that there are no other appropriate properties for the tenent to move into, I think.
Has your client tried to get assistance from the Social Services Authority for help with housing issues?
Do they have a care plan? Do they meet the criteria set out in FACS for your Local Authority?

Have a look at R(IS)11/98 and CH/0296/2004 which are helpful

On the flip side to the authorities cited by Derek, also see CH/1096/2008.  This was a case where the LL had appointee status and the clmt had limited capacity.  In short, it went strongly against the claimant on the facts of that case.

Thanks for your help, especially the case law which is very informative.

I was interested in Steve H’s point regarding alternative accommodation in the area, is there a legal authority that says that this must be considered as part of the decision to award HB or not?

In this case the client is in res care but for various reasons it is felt that he would do better living in the community and near his family who will have a lot of input into his care. I’m not sure who funds his current care plan but I have no doubt that he will recieve help from either ourselves or the NHS for the rest of his life.

Most of the case law on the question of alterntive accommodation centres on “old Reg 11”. 

Its clear that in the context of Reg 11, the cost of, and availability of suitable alternative accommodation is a major consideration, but in the context we are discussing its far more circumspect.

If you get over the hurdle of whether or not the arrangement you are proposing to enter into is a commercial arrangement (and here you will need to use the arguments in R(IS)11/98 and CH/0296/2004), you then have to face the ” take advantage” provision in Reg 9(1)(l).

The burden of proof is on the LA to show that the arrangement was designed to “take advantage ” of the HB.  In this context “take advantage” means “abuse” (CH/39/2007).  I would argue that you are not abusing HB (and the question of alternative accommodation is relevant here), but you are in fact doing your LA a favour by taking on tasks that would otherwise be the responsibility of social services, and that you are saving your LA a significant amount of money

For the avoidance of doubt the issue of suitable alternative accommodation is only relevant in the context of deciding whether the agreement is designed to take advantage of the HB scheme.  It is not for the LA to point to the availability of suitable alternative accommodation in itself as a reason for refusing HB as it would be, for instance, in a rent restriction case.

As Derek might himself say on occasions…  CH/0039/2007 is very much an “on the facts” case.  I happen to be aware there is far more to the cases addressed in that decision than is indicated.

Thanks again for all your responses,I have asked that a visiting officer from the local authority HB department if they are able to visit and give an authoritative view on the question. I hope that they are willing to do this as it would set the parent’s mind at rest and enable what seems to be a very helpful and appropriate care plan to go ahead.

My concern is also whether the family member has appointeeship or deputyship. The former is a relationship purely for social security matters, the latter is for all. For example, if there is a tenancy agreement, who would sign on behalf of the tenant? Is he capable of understanding what he is doing? Do you get an uncomfortable feeling that the same person is going to be on both sides of the contract?
A deputy is in a fiduciary (= trustee-like) position, and will be under a personal obligation to the person he acts for not to make a personal gain out of the relationship. As a lawyer, I’d be worried about conflicts of interest.
I presume that the deputy/appointee will be personally liable for the costs of the proposed purchase, and that it is not being bought out of trust funds held for the intended tenant (as sole beneficiary or one of several). I may be wrong but I think that one of the prohibited groups of claimants for HB is people who are paying money to trustees to occupy trust property.

As yet the person concerned is neither appointee or guardian, the appointeeship rests with the care provider who will give it up when the client moves out, It has yet to be decided what applications will be made and by who.

I very much share your concerns about a conflict, although I probably worded it quite badly that was the gist of my original posting. It has been proposed that one parent might be the landlord and the other is appointee/ guardian; in my view this is not likely to reduce the conflict since both parents clearly have a financial interest in the property to be bought. Given the ‘case by case’ nature of the decisions that various people have kindly posted I would also be concerned that an appointeeship in the circumstances described above would in effect raise the same queries as a guardianship even if they are legally different. There isn’t a trust fund of any sort.

Although certainly not on all fours, some of the issues that we are concerned with here were considered by a tribunal of commissioners in R(IS)17/94.

R(IS)17/94 rested on Scottish law, but the position in English law was considered in CIS/195/1991