[1997] UKSSCSC CIS_12022_1996 (30 January 1997)

Factual and Procedural Background

The claimant, who suffers from epilepsy and brain damage and is unable to manage his own affairs, has been on income support since 1988. Throughout this period, his mother, who also suffers from disability, acted as his appointee managing his social security affairs. The claimant held a building society account with savings relevant to his income support entitlement. From March 1991 to March 1995, the department calculated benefits based on a savings balance of £3,215.59, the figure provided by the claimant's mother and the building society.

In reality, the savings balance increased from approximately £3,900 in July 1992 to £5,790 by March 1995, primarily due to deposits made by the claimant's mother from her pension as gifts to the claimant. The department only became aware of the increased savings in March 1995 after reviewing the building society passbook entries. This delay resulted in an overpayment of income support totaling £1,273.

An adjudication officer's decision dated 10 March 1995 found that the overpayment arose from the claimant's mother's failure to disclose material information from 6 August 1992 onwards, making the overpayment recoverable from her. The social security appeal tribunal initially confirmed this decision on 16 October 1995, but with a minor technical error in the overpayment amount. The Commissioner set aside the tribunal's decision and substituted his own decision on the same practical effect.

Legal Issues Presented

1. Whether the acts or omissions of an appointee can be imputed to the claimant for purposes of recovery of overpaid benefits.
2. Whether a distinction should be drawn between omissions by an appointee acting on behalf of a claimant and omissions made personally by the appointee.
3. Whether the overpayment of income support due to failure to disclose increased savings is recoverable from the claimant's mother acting as appointee.

Arguments of the Parties

Appellant's Arguments

• The claimant's mother contended that she had made additional disclosures to the department during the relevant period but could not specify details.
• The appellant requested an oral hearing at her home due to health concerns.
• The claimant and his mother argued that the factual handling of the case by the tribunal was flawed.

Respondent's Arguments

• The adjudication officer submitted that the overpayment was recoverable from the claimant's mother as the responsible party for the failure to disclose material facts.
• It was argued that the tribunal erred in law by not distinguishing between the appointee's personal omissions and those made in her capacity as appointee.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
R(SB) 21/82	Benefit overpaid due to failure to disclose material information is recoverable even if failure was innocent. "Any person" liable to repay includes those responsible for the failure to disclose. Failure to disclose requires breach of a moral or legal obligation where disclosure is reasonably expected.	The court followed this precedent to hold the claimant's mother liable for failure to disclose increased savings, confirming the recoverability of overpaid benefits.
R(SB) 28/83	Failure to disclose material facts by a receiver acting on behalf of an incapacitated claimant imputes liability to the claimant's estate.	Used to affirm that omissions by an agent or appointee may be imputed to the principal, supporting recovery against the claimant through his appointee's failure.
Jones v. Chief Adjudication Officer [1994] 1 WLR 62	Approval of the principles in R(SB) 21/82 regarding recoverability of overpaid benefits due to failure to disclose.	Cited with approval by the Court of Appeal; the court relied on this to reinforce the legal principles applied.

Court's Reasoning and Analysis

The court reaffirmed the well-established legal principle that acts or omissions of an agent (appointee) are imputable to the principal (claimant), affecting the principal's legal position. It rejected any distinction between omissions made personally by the appointee and those made in the capacity as appointee, noting that such a distinction was not helpful or supported by precedent.

The court emphasized that the claimant's mother had full responsibility for managing the claimant's social security affairs and that her silence regarding the increased savings balance after March 1991 led to the overpayment of benefits. The tribunal's factual findings—that no adequate disclosure was made between March 1991 and March 1995 despite telephone calls at the start and end of that period—were accepted as thorough and conscientious, and not subject to re-examination on appeal.

The court applied the principles from R(SB) 21/82 and R(SB) 28/83, which establish that overpaid benefits due to failure to disclose material information are recoverable from the person responsible for that failure, even if innocent, and that such failure can be imputed to the principal. Concurrent rights of recovery exist against both the appointee and the claimant through the appointee's failure.

Accordingly, the court set aside the tribunal's decision due to a technical error in the overpayment figure and substituted a decision confirming recoverability of £1,273 from the claimant's mother as appointee. The department elected not to pursue separate recovery from the claimant himself.

Holding and Implications

The court's final ruling was to SET ASIDE the social security appeal tribunal's decision dated 16 October 1995 and substitute its own decision. The substituted decision confirmed:

• The review and revision of the claimant's income support entitlement from 6 August 1992 onwards to reflect the correct savings balance.
• The overpayment of £1,273 was caused by the claimant's mother’s failure to disclose material facts as appointee.
• The overpaid amount is recoverable from the claimant's mother under section 71 of the Social Security Administration Act 1992.

The implications are that an appointee's failure to disclose material information can give rise to personal liability for overpaid benefits, which is imputable to the claimant. The decision does not set new precedent but affirms existing legal principles regarding agent-principal responsibility in social security claims and benefit recovery.