Secretary of State for Work & Pensions v Wincott

Regulation 19(1A) of the Child Support (Variation) Regulations 2000 identifies a qualifying state of affairs for a variation. Its present tense does not restrict the provision to regular payments or to income received after the application. For a single dividend, receiving income means receiving it as a single sum, and the relevant conditions must be fulfilled concurrently. Regulation 25 requires the additional income to be converted into a weekly amount, ordinarily by dividing the dividend by 52 and relating it to weeks after payment. Applying the provision to a dividend received before its commencement is not retrospective where the variation affects only liability arising after commencement.

The Secretary of State calculated child maintenance by reference to Mr Wincott’s income. On 30 March 2005, he received a dividend distribution of £27,400 from his company. Regulation 19(1A) of the Child Support (Variation) Regulations 2000, inserted by regulation 8 of the Child Support (Miscellaneous Amendments) Regulations 2005, came into force on 6 April 2005.

After learning of the dividend, the parent with care applied for a variation on 20 December 2005. The Child Support Appeals Tribunal upheld the increased calculation, but Commissioner Turnbull allowed Mr Wincott’s appeal. The central issues were whether the dividend could be treated as income being received when the variation application was made, whether it could be spread over 52 weeks, and whether applying the regulation to a dividend received before commencement was impermissibly retrospective.

The appeal was allowed unanimously. The decision of Commissioner Turnbull was displaced and the Child Support Appeals Tribunal’s determination was restored. There was no order as to costs.

1. Lady Justice Arden held that regulation 19(1A) identifies a qualifying case or state of affairs in which the Secretary of State may agree to a variation. It does not itself require a variation, since the separate requirement that the variation be just and equitable remains. The present tense is appropriate because the provision describes a state of affairs which must be applied to relevant past facts. The conditions in subparagraphs (a) and (b), read conjunctively, must be fulfilled at the same time.
2. For income received as a single payment, such as a dividend, the words is receiving mean receives or is in receipt of. Regulation 19(1A) does not require regular payments. The dividend therefore remained capable of satisfying the provision, notwithstanding that it had been paid several months before the application. Lord Justice Longmore expressed the same conclusion by treating receipt as a continuing concept and holding that Mr Wincott was still receiving the income when the application was made. Lord Justice Sedley agreed with both judgments.
3. Regulation 19(1A) sets the qualifying case; the later machinery provisions determine the amount. Under regulation 25, the Secretary of State must ascertain the weekly amount of additional income. For a single dividend, this involved dividing the whole dividend by 52 and notionally relating the resulting amount to weeks succeeding payment. The dividend was not allocated by reference to the company’s accounting year or Mr Wincott’s fiscal year. Regulations 26 and 27 then governed calculation of the resulting liability.
4. Applying regulation 19(1A) to income received before its commencement did not offend the principle against retrospectivity. The provision operated only on liability arising after 6 April 2005 and did not affect any weekly proportion treated as received before that date. The court also noted that section 1 of the Child Support Act 1991 imposed a pre-existing parental responsibility which regulation 19(1A) made explicit in relation to dividend income. The principle was discussed by reference to [2004] 1 AC 816 (see para [22]).

• Court of Appeal (Civil Division): Allowed the Secretary of State’s appeal and restored the Child Support Appeals Tribunal’s determination.
• Child Support Commissioners: Commissioner Turnbull allowed Mr Wincott’s appeal on 9 January 2008, holding that regulation 19(1A) did not apply because the relevant income periods had ended before the variation application.
• Child Support Appeals Tribunal: Accepted the Secretary of State’s determination that the dividend should be taken into account in increasing the maintenance calculation.