LG v Department for Social Development (IS) (Income Support )

Factual and Procedural Background

On 31 May 2008, a decision-maker at the Department for Social Development determined that the Plaintiff was not entitled to Income Support (IS) from 24 April 2008 onward. The Plaintiff appealed this decision on 26 June 2008. A tribunal hearing was held on 21 November 2008, which disallowed the appeal, concluding that the Plaintiff had actual and notional capital exceeding prescribed limits, including a disputed sum of £20,000 considered as actual capital. The Plaintiff sought leave to appeal to the Social Security Commissioner, which was initially refused but later granted on 18 June 2010 due to an arguable legal error regarding the treatment of notional capital.

The Commissioner reviewed the case without a hearing and found the tribunal’s decision to be in error of law. Due to insufficient access to relevant evidence and the need for further factual findings, the Commissioner set aside the tribunal’s decision and referred the case to a differently constituted appeal tribunal for re-determination, providing guidance on the approach to the issues involved.

Legal Issues Presented

1. Whether the appeal tribunal erred in law in its treatment of actual and notional capital relevant to the Plaintiff's entitlement to Income Support.
2. What is the correct burden of proof regarding capital possession and deprivation in the context of Income Support entitlement.
3. Whether the appeal tribunal properly exercised its inquisitorial role in examining the Plaintiff’s capital and bank statements, particularly relating to the disputed £20,000.

Arguments of the Parties

Appellant's Arguments

• The Plaintiff argued that due to a severe head injury, the tribunal did not have all relevant bank statements concerning his savings and expenditure.
• The Plaintiff later conceded that all relevant bank statements had been submitted but indicated that additional statements prior to 2 July 2007 might be relevant for further consideration.

Department's Arguments

• The Department opposed the appeal on the grounds cited by the Plaintiff but acknowledged a separate legal error by the tribunal regarding notional capital, though it did not render the decision perverse.
• The Department submitted that the tribunal’s finding of actual capital was sufficient to exclude the Plaintiff from entitlement to Income Support, which may have led to insufficient scrutiny of notional capital.

Table of Precedents Cited

Court's Reasoning and Analysis

The Commissioner identified that the appeal tribunal’s decision contained a legal error in its handling of the capital issue, particularly regarding the disputed £20,000. The tribunal concluded this sum remained as actual capital without adequately investigating the source or disposition of the funds, despite evidence suggesting the Plaintiff had pre-existing capital in the relevant accounts and had suffered a head injury affecting his articulation.

The Commissioner examined relevant legislation, including provisions of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 and the Income Support (General) Regulations (Northern Ireland) 1987, which define capital limits and the treatment of actual and notional capital.

In reviewing case law, the Commissioner found that the burden of proof on entitlement to Income Support is not solely on the claimant to prove capital possession but involves a cooperative fact-finding process between the claimant and the department. The Commissioner noted that the tribunal failed to rigorously apply this inquisitorial role by not thoroughly examining the bank statements or addressing the apparent gap in capital.

The Department’s argument that the tribunal’s finding of actual capital obviated the need to consider notional capital was rejected; the Commissioner emphasized that the tribunal must assess notional capital with evidential specificity, even if the figure is zero.

Due to these deficiencies and the absence of access to all relevant evidence, the Commissioner concluded that the tribunal’s decision was in error of law and required referral to a differently constituted tribunal for full re-determination.

Holding and Implications

The Commissioner SET ASIDE the decision of the appeal tribunal dated 21 November 2008 and referred the case to a differently constituted appeal tribunal for re-determination.

The new tribunal is directed to apply a rigorous and inquisitorial approach, taking into account all relevant evidence and legal principles, particularly concerning actual and notional capital and the burden of proof. The Plaintiff’s entitlement to Income Support remains undetermined and will be reconsidered on the full facts and law. No new precedent was established; the decision primarily affects the procedural posture of this appeal and ensures proper legal standards are applied in future proceedings.