NSP v Stoke-on-Trent City Council & Anor

A housing-benefit overpayment caused by a claimant’s misrepresentation of a material fact is recoverable, under regulation 101(2)(b), only from the person who made the misrepresentation, rather than from a landlord who received payment directly but did not make or cause it. A written answer on an official claim form is capable of amounting to a representation even without a formal declaration that its contents are true.

A fact is material for this purpose only if it actually changes the outcome of the entitlement decision. A separately unreported change of circumstances which did not cause the overpayment is not a material fact for recovery purposes. A tribunal may not proceed in a necessary party’s absence without satisfying the conditions in rule 31 of the Tribunal Procedure (First-tier Tribunal) (Social Entitlement Chamber) Rules 2008.

The appellant landlord appealed against a First-tier Tribunal decision that a housing-benefit overpayment was recoverable from him. The benefit had been paid directly to him for a tenant whose accommodation had been incorrectly described as a one-bedroom flat rather than a bedsit. The tenant later moved to another bedsit in the same building.

The tenant was a necessary second respondent but had not been registered or notified as a party to the First-tier Tribunal proceedings. The Upper Tribunal therefore considered both the procedural validity of that decision and, on remaking it, whether the overpayment was recoverable from the landlord, the tenant, or both.

1. Appeal allowed. The First-tier Tribunal decision was set aside for a material procedural error. The tenant was a necessary party but was not notified of either hearing or given the opportunity to participate. Rule 31 required the tribunal to be satisfied that he had been notified, or that reasonable steps had been taken to notify him, before proceeding in his absence. Neither Judge B nor Judge A could properly proceed without satisfying those requirements.

2. The Upper Tribunal remade the decision under section 12(4) of the Tribunals, Courts and Enforcement Act 2007. The evidence permitted only one lawful outcome, so remission would cause unnecessary delay.

3. Under section 75 of the Social Security Administration Act 1992 and regulation 101(2) of the Housing Benefit Regulations 2006, an overpayment caused by a claimant’s misrepresentation of a material fact is recoverable only from the person who made that misrepresentation, instead of a different person to whom payment was made. The landlord’s agent was not proved to have made an oral misrepresentation, and the decision maker had relied on the tenant’s completed change-of-address form.

4. The tenant’s untrue written account of his accommodation was nevertheless a misrepresentation. By answering and submitting an official form, he represented that his answer was as stated. A formal declaration that the information was true was not required for that conclusion.

5. The overpayment was not caused by official error because the tenant’s incorrect information materially contributed to the authority’s mistake. The tenant’s later move between equivalent bedsits was a reportable change, but it was not a material fact for regulation 101(2)(b): it did not alter entitlement or cause the overpayment. The original false description of the accommodation did so.

6. The overpayment of £575.36 was recoverable from the tenant alone and not from the landlord.

• Upper Tribunal (Administrative Appeals Chamber): Allowed the landlord’s appeal, set aside the First-tier Tribunal decision for procedural unfairness, and remade the decision.
• First-tier Tribunal (Social Entitlement Chamber): On 28 January 2020, held that the overpayment was recoverable from the landlord. The tenant, although a necessary second respondent, had not been properly included or notified.
• First-tier Tribunal (Social Entitlement Chamber): An earlier decision of 1 October 2019 was set aside on 11 December 2019 because of inadequate notice to the landlord.