Housing Benefit and capital disregard
We have a case in which a client has had her 2nd property disregarded as capital for first 26 weeks then a further 26 weeks and then for what appears to be a further 3 years ( I think in error)
The Local auth realised/or decided to end this disregard in 2017 and she is unhappy about this.
The house has been valued at 39k and is in disrepair.
The constituent has only sickness benefits and feels she cannot afford her HB to drop.
She has significant health issues including PTSD anxiety and possibly other MH issues. She is in no position to live in that house and is not in a good place enough to sell the house.
I am getting some more details from the LA and I think the best thing is to appeal but I was wondering if there is any case law or appeal cases that I can refer of cases which show a property being disregarded for a long time based on ill health/MH/inability to manage affairs?
is she on a passported benefit?
if so, the value of the property is disregarded.
If the LA have removed the disregard retrospectively, then you need to ask them why - if they say they should have done it earlier but didnt, then she may have a case for LA error non recoverable, depending on whether they advised her how long the disregard would be applied for and what steps she would need to take (re disposal) for the disregard to continue.
However, if she has a second property and isnt doing anything with it, nor is taking steps to dsipose of it (selling it) then it would be taken into account as capital and nil her awards .
It’s very fact dependent (are you actually “taking steps” at all, are those steps “reasonable” in all the circs? etc). E.g. from CIS/1549/2009, under the similar IS rules:
34. The fourth question, assuming that such reasonable steps were being taken, is how long the disregard should last for. Paragraph 26 makes it plain that the disregard must last for a minimum “period of 26 weeks from the date on which he first took such steps”. However, the 26-week period is just that, a minimum. The disregard may alternatively last for “such longer period as is reasonable in the circumstances to enable him to dispose of those premises”. Again, the issue of reasonableness is pre-eminently a question of fact. Each case will depend on its own facts, and the efforts made to sell the property are merely one of several factors that may be relevant (see CIS/6908/1995 at paragraph 11). A person’s state of health may well be a relevant consideration (see CIS/4757/2003 at paragraph 6, decided in the context of the similar disregard under paragraph 3 of Schedule 10).
(edit: Another way to look at it, if the disrepair is bad enough, is: does the house really have a value of £16K+ on the open market? Was that £39K valuation done taking all the facts into account?)[ Edited: 9 Aug 2018 at 07:28 pm by Jon (CHDCA) ]
Thank you for this.
At the moment the house isn’t being disposed of.
She is on ESA - Income related i think so I would have thought she could be pas sported- will follow this us
Do the DWP know about the 2nd property?
I doubt the Council would know if passported.
The Upper Tribunal has changed its position radically (or so it seems to me) on property assets and agree now that almost any interest can be sold and that there is a clear market (e.g. at auction where a seller can ask for 14 day completion). Four years disregard sounds a long time to me although the Council has no reason or probably power to change from an earlier date.
The latest caselaw on this is CH/0190/2018, dated 10/07/2018 where Judge Jacobs clarifies views on values and valuers.
Must say I’m still not completely enamoured with this UT case, why the judge has decided to ignore the reasonable steps issue is beyond me, it should still have been considered (That’s the whole basis of the disregard), even if he arrived at the same conclusion.
various UT cases have said that there is a market for this kind of asset but I have yet to see any case that tells you how to access the market. Does anyone have any practical experience of a claimant actually selling this kind of interest? How did they do it? Or, conversely, has anyone tried to do this and found that in reality there is no mechanism for accessing this mysterious market?