Petition of Alan Houston for Judicial Review (Court of Session)

Factual and Procedural Background

The Appellant sought judicial review of decisions by the Secretary of State for Work and Pensions to make deductions from his State Pension Credit. These deductions were made to recover crisis loans from the Social Fund dating back to 2006 and 2007. The Appellant challenged the lawfulness of these deductions on several grounds, including statutory interpretation of the inalienability of pension credit, prescription of the repayment obligation, and the assertion that he had never received the loans in question. The court considered these issues in the context of the statutory framework governing Social Fund loans and pension credit deductions.

Legal Issues Presented

1. Whether deductions may lawfully be made from State Pension Credit to recover Social Fund crisis loans, given the statutory inalienability of such benefits under the Social Security Administration Act 1992, section 187.
2. Whether the obligation to repay the Social Fund crisis loans had prescribed under the Prescription and Limitation (Scotland) Act 1973, section 6.
3. Whether the Appellant had in fact received the loans from the Social Fund, thereby justifying the deductions.

Arguments of the Parties

Appellant's Arguments

• Relying on the inalienability provision in section 187 of the Social Security Administration Act 1992, the Appellant argued that deductions could not lawfully be made from pension credit.
• The Appellant contended that any obligation to repay the Social Fund loans had prescribed under the Prescription and Limitation (Scotland) Act 1973, likening the loan to a contract subject to a five-year limitation period.
• The Appellant asserted that he had never applied for or received the loans, citing homelessness at the relevant times and disputing the legitimacy and sufficiency of information provided by the Department of Work and Pensions (DWP).
• He alleged that the DWP had acted fraudulently and that the documentation relied upon by the respondent was incomplete or inaccurate, including a misrepresentation that all loan documentation was held.
• The Appellant invoked the principle from E v Home Secretary relating to mistakes of fact giving rise to unfairness as a basis to challenge the deductions.

Respondent's Arguments

• The Respondent relied on the statutory framework permitting recovery of Social Fund awards by deductions from prescribed benefits, including pension credit, citing sections 78(1) and (2) of the Social Security Administration Act 1992 and related regulations.
• It was submitted that section 187’s inalienability provisions address voluntary assignation or charge of benefits and do not preclude statutory deductions for recovery of Social Fund loans.
• The Respondent argued that the obligation to repay crisis loans is statutory and not subject to prescription under the 1973 Act, as it is not a contractual or common law obligation but a statutory "award" repayable under section 139 of the 1992 Act.
• Evidence including DWP computer records and an acceptance form signed by the Appellant demonstrated that two crisis loans had been applied for and awarded, with some repayments made but outstanding sums remaining.
• The Respondent acknowledged human error in document retention and an incorrect statement regarding documentation but maintained that the available evidence justified the deductions.
• It was emphasized that judicial review focuses on the lawfulness of the deductions, not the merits of the underlying decision.

Table of Precedents Cited

Court's Reasoning and Analysis

The court first addressed the statutory inalienability of pension credit under section 187 of the Social Security Administration Act 1992, concluding that this provision prevents voluntary assignation or charge of benefits but does not preclude statutory deductions for recovery of Social Fund loans. The court found clear statutory authority in section 78 of the 1992 Act and related regulations permitting deductions from pension credit to recover repayable Social Fund awards.

Regarding prescription, the court analysed the Prescription and Limitation (Scotland) Act 1973 and found that the statutory obligation to repay crisis loans does not fall within the categories of obligations subject to prescription under that Act. The statutory nature of the loan repayment obligation excluded it from being treated as a contract or common law obligation subject to a five-year limitation period.

On the factual dispute whether the Appellant had received the loans, the court gave weight to contemporaneous DWP records and a signed acceptance form, despite some admitted deficiencies in documentation. The court accepted the affidavit evidence explaining the records and found no irrationality in the decision to make deductions.

Finally, the court considered the Appellant’s claim of a mistake of fact causing unfairness under the principles from E v Home Secretary. It concluded that no mistake of fact had been established that was uncontentious or objectively verifiable, and thus this ground of challenge failed.

Holding and Implications

The court DISMISSED the petition for judicial review.

The direct effect is that the deductions from the Appellant’s pension credit to recover Social Fund crisis loans are lawful and may continue. The court did not establish any new legal precedent beyond the application of existing statutory provisions and established principles governing judicial review and statutory recovery of benefits.