Undeclared work, Closed Period Supersessions and PIW/PLCW

I would appreciate some advice about the following scenario.

Client on SDA (it would make no difference whether it was IB or CESA).  Partner working full time so no entitlement to IS or IRESA.

Client works full time (without telling DWP) for just long enough to break the linking period for SDA.  Then stops work for several years.  Then works again without informing DWP and also for long enough to break linking period.  Then stops.  Eventually it all comes to light.  Earnings and hours are above Permitted/therapeutic work limits.

DWP say she was not entitled to any SDA from when she started the first job as she broke the SDA linking periods and as the first job ended after SDA had been abolished for new claims, she never qualifies again and thus has been overpaid a huge amount, including for the long period when she did not work.

My argument in response is that closed period supersessions apply so that she is only disqualified for the periods in work, not the long gap between the two jobs or after the second job.  A closed period supersession means that no new claim is required and her entitlement to SDA is therefore preserved for the non-work periods; she is treated as if a claim had been made.

DWP’s response to that is that she was not in a Period of Incapacity for Work (PIW) when she stopped work after the first job.  Therefore she is not entitled to SDA (again the same principle would apply if this was ESA).

In turn, my thoughts are that she was in a PIW because the effect of the closed period supersession is to preserve her previous status of being incapable of work (there being no other challenge to this and no reason to suggest she was not ICW).  Her old PIW is treated as if it still existed.  Second, a PIW is a concept for IB/SDA which can only exist after a claim has been made and a decision made that someone is incapable of work.  Again these are preserved by the closed period supersessions treating her as if a valid award was still in existence.

The caselaw on closed period supersessions which I am relying on is: CIB/4090/1999, CIB/5170/1999 (para 15 – periods outside paid work “applied as if a claim for incapacity benefit was in being”, CIS/745/02 (para 5 (The question of entitlement must be considered in relation to each week within the period in issue as if a claim for it still existed”.  Also CIS/2595/2003 and CIB/5759/1999.

DWP distinguish all of these on the basic facts which I think is completely missing the point about the ratio of decided cases and the principle of a Closed Period Supersession which has been established as result.

Is there a flaw in my argument that the PIW which started before she started her first job is treated as preserved by the closed period supersession? I can’t find any caselaw which deals with the PIW issue in the context of a Closed Period Supersession and deductive logic tells me I must be right.

Thanks Tony.  I thought I was right.

As regards links, I’m not sure I know how to upload the CDs which are in Word docs on my computer.  I’m also away from the office for a few days.