Is it a recoverable overpayment

In my view the claimant should appeal against this decision.

It is arguable that there is not even an “overpayment” within the meaning of Regulation 99 of the HB Regulations 2006 here-

Before one even considers the issue of whether an amount of money is recoverable (under Reg 100) one must first be satisfied that it counts as an “overpayment” (as it is only overpayments which can be recovered under Reg 100).

Reg 99 defines an overpayment as follows:

“[.....] any amount which has been paid by way of housing benefit and to which there was no entitlement under these Regulations (whether or the initial decision or as subsequently revised and superseded or further revised and superseded) and include any amount paid on account under regulation 93 (payment on account of rent allowance) which is in excess of the entitlement of housing benefit as subsequently decided”.

The claimant in the case you describe was entitled to the HB that was paid to him. In social security law issues of entitlement and issues of payment or receipt are dealt with separately- so the rule for payment direct to a landlord which is an exception to the general rule about payment to a tenant is in Reg 95 and is all worded as “payment”- but it is always the claimant who is entitled to HB (regardless of where it gets paid)- see sec 130(1) of the Social Security Contributions and Benefits Act - “A person is entitled to housing benefit if-
(a) he is liable to make payments….”

Even were this an overpayment, I cannot see that it would be recoverable under Reg 100 in any event - the cause of paying to the tenant was clearly LA error and probably unlikely that claimant could have known of landlord request or about the rules on 8 weeks arrears…

For what it’s worth, based on the information given, I think the LA was wrong to pay twice for the same period.  The matter should have been one that is/was the subject of compensation.

However, I don’t necesarily agree with Martin that this isn’t HB (in this case).  But, I suspect there is more to this and for that reason (and unusually :-)), I will desist from adding more.

I agree with Martin that the first consideration is whteher or not there has been an overpayment. as defined by Reg 99 ie whther there has been
“any amount which has been paid by way of housing benefit and to which there was no entitlement under these Regulations (whether or the initial decision or as subsequently revised and superseded or further revised and superseded) and include any amount paid on account under regulation 93 (payment on account of rent allowance) which is in excess of the entitlement of housing benefit as subsequently decided”

The claimant was entitled to payment of the benefit under the terms of the original decision and remains so entitled unles and until the decision is revised or superseded.  There appears to be no grounds to revise the original decision, but there may well be grounds to supersede following receipt of the landlords letter.

Any decision to award housing benefit must include a determination as to whom it will be paid to under the terms of Regulations 94 to 97. A superseding deccision may alter that determination, but the effective date is subject to Regulations 7,8 and 9 of the HB/CTB (Decisions and Appeals) Regulations.

It is arguable that the if grounds for the superseding decision is a change of circumstances, (ie the claimant is >8 weeks in arrears) and the change was promptly reported by the landlord, the effective date for the superseding decision is the date the rent became 8 weeks in arrears, or the date the change was reported.

If the LA fail to act, the effective date for the superseding decision is still the same as above, but the claimant would not be entitled to payment of the HB under the terms of the new superseding decision.  Any benefit that was alredy paid to the claimant would be overpaid, but that amount would be on account of an official error by the Council.

The claimant would have a very strong argument that the amount is not recoverable because he could not resonably be expected to realise he was being overpaid at the time the benefit was paid.  (The fact that he did not use the payment to pay his rent of itself does not mean that he is not entitled to the payment.)

Judge Turnbull considers some of the issues in CH/765/2008

My thanks for the valuable help.

I will try to assist the claimant and landlord with this issue and report back if there are any problems.

My thanks again…and best wishes

Ray

Hi

Just received a reply as follows: -

I can advise that after reading the relevant section of Shelter Guide to Housing and Council Tax Benefit 2011 Chapter 16, section 16.72 which discusses what to do when the wrong person has been paid, and the Commissioner’s decision CH/765/2008; I believe that where housing benefit has been paid to the wrong party, that is to the tenant when the landlord should have been paid, the Local Authority can make a payment for the same period to the landlord as a Housing Benefit payment and to recover the monies paid to the claimant in error as an overpayment, as although the entitlement was his it should not have been paid direct to him.  Once the overpayment is created and assigned to the tenant recovery is made from ongoing benefit where there is a claim in pay leaving the tenant to make up the shortfall in rent direct to the landlord. 

In this scenario should a tenant dispute either the fact that of the overpayment or the recoverability from him, this needs to done through the Appeals process.

This still sounds wrong to me because the error was that of the LA in the fist place….surely it is not recoverable?

Any further help or thoughts would be much appreciated.

Very best wishes

Ray

I think an ombudsman complaint might be in order

Just received a response from the Council which is taking the appeal to Tribunal.  I am amazed at the decision to do so.

However, its case is as follows: -

1.  The appellant is appealing a housing benefit overpayment of £483.28 for the period 4th July to 31st July 2011.
2.  The authority changed payments of Housing Benefit in respect of a liability at ****** from the appellant, ********, to the landlord.
3.  The landlord had stated in a letter received 29th June and dated 27th June 2011 that the appellant had requested payment to be changed back to her landlord as she was struggling with her rent. He also confirmed that the appellant was over 8 weeks in arrears.
4.  Unfortunately, by the time the letter was dealt with, two further payments of HB had been issued totalling £483.28 for the above period.
5.  So that the appellant’s tenancy was not put at further risk, the authority made supersession and changed payments to the landlord from 4th July 2011 ie, following the date of his request. HB payments were changed in accordance with regulations 95 and 96 of the Housing Benefit Regulations 2006.
6.  This decision meant the appellant was no longer entitled to HB from 4th July 2011 and was therefore overpaid.
7.  The authority considers the overpayment was not caused by any official error. Even if it was, the overpayment was recoverable, because the appellant had, agreed with the landlord that HB was to be paid to him as she was struggling with the rent. Therefore, it was reasonable for the appellant to have known she was not entitled to the payments.
8.  For these reasons, the overpayments are recoverable in accordance with regulation 100 of the HBR 2006.
9.  The appellant states in her appeal that she believes the overpayment is not recoverable. The appellant then states that it was not an overpayment.

It seems to me that para 4 indicates that the Council failed to act on the information it had, making not one, but two payments after receipt of notification that there were 8 weeks arrears.

Para 6 states that the appellant/applicant was “no longer entitled to Housing Benefit”....Surely, what the Authority is trying to say is that, whilst the claimant was still entitled to HB, payment should be directed to the Landlord as there are 8 weeks arrears of rent.  Housing Benefit has continued to be paid direct to the landlord immediately following the first change made by the LA.

Para 4 states it was NOT Official Error…..if the LA knowingly made payment for the same period on the same property as a means of redressing its first mistake, does not this simply compound the problem?

At 9, the appellant made the point that if there is an overpayment it should not be recoverable, but most importantly, that it was NOT an overpayment.

Perhaps it is just my interpretation, or ignorance of the Regulations, but the defence made by the Council appears bizarre…..or am I missing something please?

Clearly, if this is going as wrong as it might appear then, as a Councillor I feel it my duty to intervene as appropriate and bring the matter to someone with the Authority to over-ride what is an inappropriate defence of the Council’s position.  However, before attempting to do so, any help or guidance from the experts here would be much appreciated….

Also, I have now been advised that despite a request for suspension of recovery of the alleged overpayment from ongoing benefit, this has been ignored and recovery is taking place.  I suspect that this is against good practice guidelines?

Thanks very much.

Ray

You won’t like this but, based on the information given, I think the LA does in fact have an argument - legally if not morally.  That of course doesn’t mean it is correct but that is now a matter for the Tribunal to determine.  I’m not up to making a detailed post (personal circumstances) but the following springs to mind:

1)  a delay in processing doesn’t necessarily constitute an error - it depends on the reasons for the delay.  On that basis, the LA can certainly argue there was no error on its part.  Whether that is an opinion the Tribunal holds is another matter, but the LA is allowed to argue the point in exactly the same way as an appellant is entitled to argue to the contrary.

2)  on point 6, that appears to be incorrectly stated.  It seems the appellant WAS entitled; the issue is about the payee and/or double payment, not entitlement.

3)  if the LA is correct about what the clmt could reasonably be expected to realise, the LA would be correct in arguing that the overpayment is recoverable even if it was caused by an error on its part.  If there has been an overpayment, the LA should cease recovery until the appeal is decided - ask the Tribunal for a Direction (citing the principles in CH/1757/2009).

As an aside, I don’t think it is for anyone other than the Tribunal to think they should be the arbiter of such a dispute.  It is a matter that falls fairly and squarely within the jurisdiction of the Tribunal.  The appeal and Tribunal process should proceed without inappropriate interference by anyone, whether a Councillor or otherwise, to attempt to override due process.

Finally, CH/0765/2008 is not the only case law on the issue of two payments / wrong payee.  In CH/2912/2007; CH/0180/2006 & R(H) 2/08, it was found that two payments could NOT be made for the same period.  CH/0765/2008 was found differently because the facts were different.

Hi Kevin,

Many thanks for your very clear and helpful reply; I know it may not be what I really had hoped to see based on previous posts, but that was the reason for asking for help, for which I am very grateful.

With reference to the LA arguing the case for a delay, I suspect that had it missed just one run or issue of cheques it might have been reasonable to suggest that the failure to initiate, at least a suspension of benefit payment until the position was resolved, was perhaps unavoidable, however a further payment was issued 4 weeks later.  The LA was not waiting for further information from the claimant or the LA and simply failed to deal with the notification in a reasonable timescale.

I would also add that the LA knew from the outset that this claimant was in 8 weeks arrears as the tenancy was based around the principles in Doncaster - v - Coventry CC which has been accepted by the LA. Therefore, there has been a failure to deal with the claim properly from the outset. (However, that is a separate issue)

As you confirm, point 6 is clearly incorrectly stated and cannot therefore be relied upon.

The claimant did not know that, any further payment that was being issued to the landlord would create a recoverable overpayment; I also question the legality of an Authority, knowingly issuing a payment which would create an alleged overpayment, where recovery was debateable. Payment cannot be made twice for the same period.

I think the key point is the one you make, whether or not there is actually any overpayment…

I am grateful for your reference to CH/1757/2009 which is very helpful; thank you very much.

Also, just to clarify, I am not attempting to interfere with any appeals process but, whilst the LA continues to recover the alleged overpayment on a weekly basis, causing hardship, my initial intention was to at least have this stopped, if there was legislation or guidance to support my request; you have very kindly helped with this.

I also question the value of time, effort, use of resources and potential distress to a claimant if there was a common sense approach to this, rather than a tribunal. The LA has usually been receptive to such an approach and it seemed appropriate in this case, where there was significant doubt as to even whether there was an overpayment. My intention was to have the case reviewed by someone in a more senior position who might even reach the same view as you have expressed questioning if there has actually been an overpayment. I am more than happy to let the appeal run its course and have suggested that the claimant uses the services of our local Shelter or CAB; however, I had simply hoped for a “local” decision which might better reflect the circumstances.

I am however, extremely grateful; for your help and assistance and also for your time in referring appropriate cases to me for guidance….very much appreciated.

Very best wishes

Ray

Just to offer a clarification of my own, I’m not suggesting that you/your client don’t have an arguable case.  But, based on the info so far, the LA’s case also appears to be at least arguable.

I completely understand the situation may cause anxiety and/or stress to you/your client (I have been involved with many appeals from almost all angles) but if the LA has an arguable case, it is appropriate for it to put in the resources.  What you could do perfectly reasonably is to write directly to, and expressly for the attention of, the Manager, setting out ALL of the arguments and ask for the decision to be revised, whilst making it clear that the appeal should still proceed unless / until the decision is revised in favour of the appellant(s).

The one thing we are defintely agreed on is that until / unless the matter is resolved one way or the other in finality, recovery of any “overpayment” should cease.

Hi Kevin

REALLY APPRECIATE THE HELP.

I will do as you say re suspension of collection of the over payment and write to the Manager, who in the past has been extremely helpful and sympathetic.

I spoke to the landlord this morning regarding the position and funnily enough, we were thinking almost on the same lines as you regarding the Manager, so we are relieved to see at least we were in the right direction.

So just to say thanks very much once again…your guidance and help is much appreciated.

Kind regards

Ray