Secretary of State for Work & Pensions v Perkins & Anor

Under the applicable housing-benefit rules, the general £20 disregard for voluntary payments is the starting rule. A whole payment may be disregarded under paragraph 13(2) where it was both intended and used for items outside the specified items. The tribunal must determine intention and actual use from all the evidence, drawing warranted case-specific inferences and applying the balance of probabilities. General assumptions or presumptions are impermissible, although statutory purpose and the relationship between the applicable amount and essential costs may inform the assessment. Direct evidence of the donor’s purpose is helpful but unnecessary. An appellate court should respect a commissioner’s fact-finding where the conclusion was open on the evidence, particularly after the commissioner heard the claimant.

Major Perkins received housing benefit from Ryedale District Council. The Council treated regular monthly gifts from his son as income and recovered an alleged overpayment. The York Appeal Tribunal rejected his appeal.

On appeal, Commissioner Mark Rowland held that the gifts were income but that they fell to be disregarded because they were intended and used for items outside the specified items in paragraph 13(2). He allowed the appeal and set aside the Tribunal’s decision. The Secretary of State, who had not appeared before the Commissioner, obtained permission to appeal to the Court of Appeal. The central issues were whether the appeal should be heard and how intention and use were to be determined under paragraph 13(2).

Appeal dismissed. The Court of Appeal unanimously dismissed the Secretary of State’s appeal.

1. Right to appeal. The Secretary of State’s rights to appear and appeal were governed by section 68 and Schedule 7 to the Child Support, Pensions and Social Security Act 2000. The court rejected the submission that it should refuse to hear the appeal because the Secretary of State had not participated before the Commissioner. The guidance relied on in The Secretary of State for Work and Pensions v Hughes (A Minor) [2004] EWCA Civ 16 did not control this case because the facts differed. The court also doubted that it would be right to decline a permitted appeal raising an important point of law.
2. Construction of paragraph 13. Paragraph 13(1) established the basic rule that only £20 of a voluntary or charitable payment could be disregarded. Paragraph 13(2) provided an exception where the payment was intended and used for items other than the specified items. Both intention and actual use had to be established.
3. Evidential inquiry. The tribunal had to consider all the evidence in context. It could draw inferences warranted by the circumstances, but could not introduce general assumptions or presumptions. The questions were to be decided on the balance of probabilities. Direct evidence of intention was helpful but not essential. Relevant matters could include the donor’s identity, the parties’ relationship, the donor’s ability and knowledge concerning the claimant’s finances, the sufficiency of the applicable amount, and the parties’ course of conduct.
4. Application. The Commissioner was entitled to infer that the gifts were intended for expenses beyond those covered by the pensions and that they were used for that purpose. The Court of Appeal was cautious about interfering with his findings because he was experienced, had examined the bank accounts, and had heard Major Perkins give evidence. Lord Justice Sedley added that the statutory purpose of the applicable amount could inform a case-specific inference, while general assumptions remained impermissible. The decision depended on peculiar facts and was not to be treated as a precedent for other cases.

Order: Appeal dismissed.

• Court of Appeal (Civil Division) — [2004] EWCA Civ 1671: dismissed the Secretary of State’s appeal.
• Social Security Commissioners — Commissioner Mark Rowland, 21 January 2004: allowed Major Perkins’s appeal and set aside the York Appeal Tribunal’s decision.
• York Appeal Tribunal — 16 May 2003: rejected Major Perkins’s appeal and upheld recovery of the alleged housing-benefit overpayment.