Sandwell Metropolitan Borough Council v NK (HB)

Under regulation 100 of the Housing Benefit Regulations 2006, an overpayment is recoverable unless it both arose from official error and the claimant could not reasonably have been expected to realise that it was an overpayment. The official-error inquiry and the claimant-awareness inquiry are separate.

A claimant who reports changes which they can reasonably be expected to understand will reduce housing benefit can ordinarily be expected to realise that continued unrevised payments are overpayments until a revised decision is made. The claimant need not know the precise amount of the overpayment.

The local authority decided that the claimant had been overpaid housing benefit of £947.92 between 13 May and 29 September 2013 after entitlement to disability living allowance, and later child benefit for a daughter, ceased.

The claimant notified the authority of the changes on 23 August 2013. The authority did not revise the award until 21 September 2013. The First-tier Tribunal, by a decision dated 30 January 2015, held that the later part of the overpayment was not recoverable because the authority should have acted within seven days.

The authority appealed. The central issue was whether the continued payments could be irrecoverable under regulation 100 of the Housing Benefit Regulations 2006.

1. Appeal allowed. The First-tier Tribunal erred in law in treating the later overpayment as irrecoverable. Its reasoning did not adequately explain why the claimant could not reasonably have been expected to realise that she was overpaid before receiving the notice dated 25 September 2013.

2. Regulation 100 distinguishes two questions. First, an overpayment must have arisen in consequence of official error. Secondly, the claimant must not reasonably have been expected to realise, when receiving the payment or notice, that it was an overpayment. If there is no official error, the claimant's inability to realise an overpayment is immaterial. Conversely, official error alone does not make the overpayment irrecoverable.

3. The Upper Tribunal did not decide whether the authority's delay after notification was official error. The approaches in CH/858/2006 and HC -v- Hull City Council (HB) [2013] UKUT 0330 (AAC) were not determinative because the claimant-awareness condition failed in any event.

4. By 23 August 2013, the claimant had reported both the end of disability living allowance and the imminent end of child benefit for her daughter. Her experience of housing benefit and the information available to her meant that she could reasonably be expected to realise that those changes would reduce her entitlement. She could therefore reasonably be expected to realise that payments continued without recalculation were overpayments, even if she did not know their amount.

5. The decision of the First-tier Tribunal was set aside. The Tribunal substituted a decision that the full £947.92 overpayment for 13 May to 29 September 2013 was recoverable from the claimant.

• Upper Tribunal (Administrative Appeals Chamber): allowed the local authority's appeal and set aside the First-tier Tribunal's decision.
• First-tier Tribunal: on 30 January 2015 confirmed the amount of the overpayment but held the part after 30 August 2013 not recoverable.
• Local authority: on 21 September 2013 decided that the £947.92 overpayment was recoverable in full.