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Hinchy v Secretary of State for Work and Pensions [2005]

Summary

As a result of this House of Lords decision a claimant is under a duty to inform the relevant office where a decision about one benefit may affect entitlement to another, such as in this case where the claimant lost her disability living allowance and failed to inform the income support department.

The Hinchy case began as a commissoner's decision that was referred to the Court of Appeal. The Court of Appeal was successful but overturned by the House of Lords. The details of these cases are as follows.

Commissioner's decision

Mrs Hinchy was overpaid income support (IS) severe disability premium when her disability living allowance (DLA) award came to an end. The case was taken to commissioner as CIS/4322/2001 (now reported as R(IS)7/05) based on the argument that as the Secretary of State knew that her DLA award had ceased there was no further need to inform the actual department responsible for her income support claim

“4. In the present case it is not and cannot of course be disputed that the Secretary of State had actual knowledge of the material fact that he had disallowed the claimant’s renewal claim for the care component of disability living allowance from 13 October 1998 onwards so that she no longer counted as a severely disabled person for the purposes of the renewal premium. The “failure to disclose” relied on and accepted by the tribunal was the fact that she had not sent a separate notification of this to the different section of the same department dealing with her income support, even though it was of course doing so in the name and on the behalf of the same Secretary of State.

5. The question of law that arises in such circumstances is whether there can properly be said to have been any failure of disclosure and to what extent any continued miscalculation of the claimant’s benefit can be properly attributed to wrongful failure on the part of the claimant, rather than the department’s own failure to marry up the information it already has. This is a question on which differing views have been expressed by Commissioners, and it is of course one of general importance.”

Commissioner Howell was unwilling to make findings in her favour because of an earlier decision by a Tribunal of Commissioners (R(SB)15/87) which was reaffirmed by another Tribunal of Commissioners (CG/4494/1999) but did grant leave for the claimant to take her case to the Court of Appeal.

Court of Appeal decision

The Court of Appeal held that Mrs Hinchy had not failed to disclose the fact that her DLA award had stopped, since the Secretary of State already knew that information.

Since the Secretary of State administered both the claimant's DLA and IS it was reasonable that the Secretary of State would put in place, and would be expected to put in place, a system to enable the IS decision makers to be informed of changes to the claimant’s DLA. In order to fulfil her obligations to disclose a claimant need only inform the DLA office.

The case was then taken to the House of Lords.

House of Lords decision

The House of Lords reversed the decision of the Court of Appeal by a majority of 4-1. In the decision the lords discussed communication between benefit departments.

“The result is that officials administering one benefit may or may not know from internal sources about the other benefits which the claimant is receiving. Whether they do or not depends upon the departmental or inter-departmental information systems in place and the efficiency with which they operate.”

It was found that although there was no computer link there was communication by post card between DLA and IS decision-makers. However any system set up was held to be irrelevant.

“The claimant is not concerned or entitled to make any assumptions about the internal administrative arrangements of the department. In particular, she is not entitled to assume the existence of infallible channels of communication between one office and another. Her duty is to comply with what the Tribunal called the "simple instruction" in the order book. ….

……For my part, I would approve the principles stated by the Commissioners in R(SB) 15/87 and CG/4494/99. The duty of the claimant is the duty imposed by regulation 32 or implied by section 71 to make disclosure to the person or office identified to the claimant as the decision maker. The latter is not deemed to know anything which he did not actually know.”

R(SB)15/87

The appropriate test for failure to disclose in this circumstance is now once more R(SB)15/87 which states in paragraphs 26 and 28:

"26 …. To whom is there this obligation to disclose? We are concerned here with breaches of the obligation which have the consequence that expenditure is incurred by the Secretary of State; and, in our view, the obligation is to disclose to a member or members of the staff of an office of the Department handling the transaction giving rise to the expenditure….

28 We accept that a claimant cannot be expected to identify the precise person or persons who have the handling of his claim. His duty is best fulfilled by disclosure to the local office where his claim is being handled, either in the claim form or otherwise in terms that make sufficient reference to his claim to enable the matter disclosed to be referred to the proper person….

…there can be other occasions when the duty can be fulfilled by disclosure elsewhere. This can happen, for instance, if an officer in another office of the Department of Health and Social Security or local unemployment benefit office accepts information in circumstances which make it reasonable for the claimant to think the matters disclosed will be passed on to the local office in question. It was in reference to this sort of case that the Commissioner included in paragraph 18 of Decision R(SB)54/83 his statement about a continuing duty. A claimant who has made such disclosure has not in fact made disclosure to the right person or in the right place, but he has done something which has the effect that, for the time being at least, further disclosure is not reasonably to be expected of him. We consider that paragraph 18 of R(SB)54/83 is concerned with the case of a claimant who subsequently becomes aware, or should have become aware, that the information has not been transmitted to the proper person or pIace and who is then under a duty to make disclosure to that person or place. We desire to reserve for consideration when it arises the question whether the means of knowledge that the information has not been transmitted has the same effect as actual knowledge."

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