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Housing Benefit Overpayment - joint tenants but only one claimed…..

Jacky Everard
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Hastings Advice & Representation Centre

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Any advice on this would be very much appreciated! To cut a very long story short:

Client is elderly woman living in a Housing Association property. Her adult child has lived with her at the same address most of her life.
In 2001 they became joint tenants. The client failed to notify the LA , the child failed to claim HB and the landlord (Housing association) failed to notify the LA.
Therefore client was considered liable for 100% of the rent and full HB was paid.
The child was a single parent claiming means tested benefits so would have been entitled to HB also.

In 2011 the council tax department were notified that they were joint tenants but failed to notify the benefits team or advise the clients to claim/amend claim.

In 2018 it became apparent that the claimant was being overpaid. A Huge overpayment of both HB and Council tax benefit had accrued. However the OP arising after 2011 was deemed not recoverable.

Client now has a huge overpayment being recovered direct from the Housing Association (who are treating it as rent arrears). There is an appeal ongoing but we have become involved at a very late stage. There is a lot more to this case but I have the following question:

If the client loses the appeal and it is decided that the remaining overpayment is recoverable is the Housing Association responsible for any part if it as they had a duty to advise the LA of the change of tenancy?

Thanks in advance

Prisca
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benefits section (training & accuracy) Bristol city council

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I assume HB payments were being made to the HA throughout the period? It sounds like the LA have decided that the landlords are responsible for the O/p recovery as you state that the O/p is being recovered from the HA, but the notification letters should confirm who the LA are targeting for recovery of the overpayment. If they are targetting the landlords for recovery, then I think they are on fairly solid ground. If they are targetting the claimant, it may be a bit harder for them to demonstrate she knew she was being overpiad, especially if payments were going to the landlords AND the household make up hadnt changed.

Is the appeal against the overpayment or the recovery of the overpayment?

I am guessing that the LA are going along the lines that the HA could reasonably expect to know that they were being overpaid, as they were aware there had been a change in the original tenants rent liability (there was now a joint tenant) but the original sole tenbants Hb entitlement didn’t decrease to (roughly) half what it was. The HA failed to advise the HB section at the time - or query why the entitlement hadn’t changed even though the tenancy details had.
Landlords do have a duty to notify the HB section of changes which they are aware of and which may impact on HB entitlement - so yes, The HA are at fault for not advising the HB section of the change when it happened. (as is the claimant for not advising the HB section of the change to her tenancy)
of course, the HA are likely to simply repay the O/p and then add it to the rent account as arrears - that wouldn’t be a matter Hb would become involved with though.

HB Anorak
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Benefits consultant/trainer - hbanorak.co.uk, East London

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With joint tenants, the Council has discretion over how it apportions the rent between them for HB purposes.  In this case, the obvious solution is to apportion 100:0 in favour of the mother so that the overpayment disappears.  I think that is the most appropriate apportionment because there is no net loss to public funds compared with what would have been paid had the daughter claimed … in fact they have been underpaid because of the non-dep deduction that presumably applied after the daughter reached age 25: as joint tenants they would have got 50% each with no non-dep charge.

The Council might well also save themselves some subsidy if they go along with that idea: the non-recoverable official error portion from 2011 onwards might currently only be attracting 40% or 0% (depends on their total official error overpayments), but if it revised to correct entitlement it attracts 100%.

What’s not to like?  The expression “no-brainer” could have been coined for this case.

Council Tax unfortunately is more difficult as joint liability can only be split equal ways.

HB Anorak
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Benefits consultant/trainer - hbanorak.co.uk, East London

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While my answer above is the preferred outcome (and if it happens I should win the internet for Tuesday), I have realised I didn’t directly answer your question about the liability of the HA.  Was HB paid to the HA?  In that case the overpayment, if there is one (and I would submit that there isn’t, but if there is an overpayment), is recoverable from both the claimant and the HA.  The Council’s decision should say that and both parties should have been notified.

Strictly speaking the Council also needs to be clear about what they are doing by way of recovery: is this recovery from the landlord or from the claimant?  The effect is the same in either case - the HB that ends up in the rent account falls short.  Unfortunately the “blameless tenant” rules, which indemnify the tenant against overpayment deductions recoverable from the landlord, only apply to the same tenant in cases of fraud by the landlord.  Your case seems to be more of an innocent mistake, so the deductions are indeed creating rent arrears for the tenant.  But I think you could still use any confusion about the capacity in which deductions are being made to cast doubt on the validity of the adjudication process.  And most certainly if the decision notices were not correctly issued to both parties naming both of them as persons from whom the o/p is recoverable you can throw that into the mix.

But Plan A for me would definitely be to apportion the joint rent in such a way that the overpayment disappears.

Jacky Everard
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Hastings Advice & Representation Centre

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Thanks for the responses -sorry for the delay responding.
To answer the various questions and points raised:
1) The rent was being paid direct to the HA
2) The HA have advised the client that any shortfall in rent as a result of overpayment recovery will be treated as rent arrears and will have to be repaid by client.
3) The client began the appeals process with the help of the HA and wasnt referred to us for advice until she attended a FTT and it was adjourned. At that stage the judge suggested they were being under represented and referred her to us. I was surprised the HA didnt immediately refer her to us (which is what they would usually do).
4) So the appeal appears to be concerned with the classification of the overpayment (both HB and Council tax) - LA say its client error but the client and HA argue its official error and shouldnt be recovered.

I completely agree about arguing that if discretion can be used 100% of the liability be attributed to the claimant but I wonder why the Tribunal didnt just decide this at the FTT? Seemed like the logical thing to do. Instead they have asked for it to be relisted with a 2 hour timeslot and a presenting officer with full records relating to all contacts on the claim since 2001. I want to try to cover all bases. The bottom line is I dont want the client to come out of this with over £18k in rent arrears because of an innocent mistake.

Many thanks

Jacky Everard
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Hastings Advice & Representation Centre

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Sorry - overpayment being recovered from HA, therefore creating rent arrears (not sure if that was clear)