AM v Secretary of State for Work and Pensions [2009] UKUT 224 (AAC)

UKUT-AAC
AM v Secretary of State for Work and Pensions
[2009] UKUT 224 (AAC) · 2009-11-03
[1]I am allowing this appeal because the original Statement of Reasons was inadequate because it did not deal with a substantive argument before the tribunal. I hold, on the technical grounds set out below, that salaried chairman acting as the tribunal has not followed the correct procedures under section 9 of the Tribunal Courts and Enforcement Act 2007 and Rule 40 of the Tribunal Procedure (First-tier Tribunal) (Social Entitlement Chamber) Rules 2008, when purporting to review the original decision and accordingly that his purported review and amendment of the Statement of Reasons was a nullity. Factual background[2]The claimant appealed a decision to supersede her entitlement to incapacity benefit to the first tier tribunal. The appeal was refused with a decision issued on 26 February 2009. The tribunal was chaired by a fee-paid chairman. At the appeal hearing the tribunal was asked to consider a case for Incapacity Benefit under Regulation 27 of the Social Security (Incapacity for Work) (General) Regulations 1995. The original Statement of Reasons, issued on 27 March 2009, contained no mention of a consideration of that case. On 16 April 2009 an application for leave to appeal was made.[3]Thereafter, on 25 May 2009 the tribunal issued an additional Statement of Reasons, signed by the original chairman, in which it stated that “Although the tribunal considered this [ie the Reg 27 case], it was not included in the Statement of Reasons. This was an accidental omission.” The tribunal went on to say “… therefore in terms of Regulation 40 of the First Tier Tribunal (Social Entitlement Chamber) Rules 2008 do amend the Statement of Reasons by adding at the end thereof a new Clause 9 …”. A further Decision Notice was issued on 8 June 2009, signed by the salaried judge, acting in terms of the Practice Statement dated 30 October 2008 , , stating that the original decision was reviewed but not revised and then stating that pursuant to section 9(4)(b) of the Tribunal Courts and Enforcement Act 2007 “the reasons for the decision are amended by the production of a supplementary statement dealing with the above “ [ie the lack of reasons about the Regulation 27 case]. The Decision notice went on to say “Permission to appeal is granted because of the importance of the matter raised …”. On 23 June 2009 the claimant applied to the Upper Tribunal for leave to appeal against the decision of the Tribunal dated “20-01-2009” [sic]. The law[4]Section 9 of the Tribunals Courts and Enforcement Act 2007, so far as material provides: Review of decision of First-tier Tribunal 9(1) The First-tier Tribunal may review a decision made by it on a matter in a case, other than a decision that is an excluded decision for the purposes of section 11(1) (but see subsection (9)). (2) The First-tier Tribunal’s power under subsection (1) in relation to a decision is exercisable—(a) of its own initiative, or(b) on application by a person who for the purposes of section 11(2) has a right of appeal in respect of the decision. (3) Tribunal Procedure Rules [may provide …] (4) Where the First-tier Tribunal has under subsection (1) reviewed a decision, the First-tier Tribunal may in the light of the review do any of the following— (a) correct accidental errors in the decision or in a record of the decision; (b) amend reasons given for the decision;(c) set the decision aside. (5) Where under subsection (4)(c) the First-tier Tribunal sets a decision aside, the First-tier Tribunal must either— (a) re-decide the matter concerned, or (b) refer that matter to the Upper Tribunal. …[5]Rule 40 of the First Tier Tribunal (Social Entitlement Chamber) Rules 2008 provides: Review of decision 40. —(1) This rule does not apply to asylum support cases or criminal injuries compensation cases. (2) The Tribunal may only undertake a review of a decision—(a) pursuant to rule 39(1) (review on an application for permission to appeal); and(b) if it is satisfied that there was an error of law in the decision. (3) The Tribunal must notify the parties in writing of the outcome of any review, and of any right of appeal in relation to the outcome. (4) If the Tribunal takes any action in relation to a decision following a review without first giving every party an opportunity to make representations, the notice under paragraph (3) must state that any party that did not have an opportunity to make representations may apply for such action to be set aside and for the decision to be reviewed again.” The law and the procedure to be followed by a tribunal[6]It is clear that a tribunal may review a decision made by it – section 9(1). In terms of paragraph 11(a) of the Practice Statement dated 30 October 2008 issued by the Senior President of Tribunals, any application for permission to appeal under Rule 38 of the 2008 rules and the exercise of the power of review under section 9 of the 2007 Act must be carried out by a salaried judge where the decision was made by a fee-paid judge. This makes for difficulties as outlined in this decision.[7]Relevant to the present case, under Rule 40(2) a review may only be undertaken by the tribunal pursuant to Rule 39(1) where there has been an application for permission to appeal and “(b) if it is satisfied that there was an error of law in the decision.” Where a tribunal has reviewed a decision, under section 9(4) it has three things that it may do – it may:
“(a) correct accidental errors in the decision or in a record of the decision; (b) amend reasons given for the decision; (c) set the decision aside”
. It is important to note that a review may only be carried out where the reviewing salaried chairman is satisfied that there is an error of law in the decision. Further I consider the review powers are cumulative and not exclusive so the tribunal may do one or more of them on a review.[8]In relation to amending a Statement of Reasons, where there has been an application to appeal, I consider that the process has to be that there has been an application to appeal and then on looking at the appeal, the reviewing tribunal [the salaried judge in terms of the Practice Statement] determines that there has been an error of law. That error of law may be that the Statement of Reasons is inadequate and therefore there is an error of law. Having made that decision, the tribunal may then consider whether or not to amend the Statement of Reasons. It has no power to amend the Statement of Reasons until it has identified an error of law. Once the Statement of Reasons has been amended, the tribunal has to decide whether or not to set the original decision aside.[9]However, it is important to note Rule 40(4) which makes clear that parties should in general be given a right to make representations before “any action is taken in relation to a decision following a review”. This is implicit in rule 40(2). If parties are not given an opportunity to make representations at that stage, then they are to be notified under rule 40(3) that they “may apply for such action to be set aside and for the decision to be reviewed again”. Further under Rule 40(3) “The Tribunal must notify the parties in writing of the outcome of any review, and of any right of appeal in relation to the outcome”.[10]It is clear that where the original tribunal was chaired by a fee-paid judge, but the review is being carried out by a salaried judge that the salaried judge is in no position to amend the reasons given for the decision, because he was not at the tribunal hearing. I consider that the practical solution is that if the salaried judge determines that there is an error of law and considers that the error of law might be rectified by amending the Statement of Reasons, he should seriously consider giving the parties an opportunity to make representations as to whether or not the original tribunal should be given an opportunity to amend the Statement of Reasons. As Deputy Judge White in [2009] UKUT 163 (AAC) [CDLA/1291/2009] states at paragraph 27 if an amendment of a Statement of Reasons is likely to lead to the same adverse decision then the procedure for allowing parties to make representations should be followed carefully.[11]If, following representations, the salaried judge determines that the tribunal should be given such an opportunity, then the appeal should be remitted to the fee-paid chairman to determine whether or not to amend the Statement of Reasons together with a note of any representations made to the salaried judge. In light of the Practice Statement, the salaried chairman having received any proposed amendments to the Statement of Reasons from the fee-paid judge, if so advised, the salaried chairman should the take the action to amend the Statement of Reasons. If it is a salaried judge reviewing his own decision, then I consider that before he amends his Statement of Reasons, he should consider giving the parties an opportunity to make representations as to whether or not he should amend the Statement of Reasons.[12]My comments about giving an opportunity to make representations before any action is taken following a review applies equally to the other powers under section 9(4)(a) [correct accidental errors] and (c) [set the decision aside], although considerations that this should be done may be less pressing than they would be in circumstances where amendment of a Statement of Reasons is being considered.[13]If the reviewing judge determines not to ask for representations, before he takes any action, including the action of amending the Statement of Reasons, then, in terms of Rule 40(4), he must notify the parties of the outcome of the review and that notice given under Rule 40(3) must state that any party may apply for such action to be set aside and for the decision to be reviewed again. The parties are then free to either to seek a set aside or to consider applying for leave to appeal. Procedure followed by the reviewing tribunal [the salaried chairman][14]There is no right of appeal under section 11(1) of the 2007 Act, by reason of section11(5)(d) against a decision of the First-tier tribunal “(ii) to take not action, or not to take any particular action, in the light of a review of an earlier decision”. This implies that there is a right of appeal against a decision of the tribunal, in a review, to take a particular action – in this case to amend the Statement of Reasons. However, I do not require to determine whether or not that is so, because I have held that the purported review and amendment procedure was a nullity.[15]I hold that the review procedure before the First-tier tribunal was a nullity for two reasons. First, the purported amendment of the Statement of Reasons came before there was a decision that there was an error of law in the original decision. Secondly, the notice under Rule 40(3) failed to comply with mandatory requirement in Rule 40(4) that “the notice under paragraph (3) must state that any party that did not have an opportunity to make representations may apply for such action to be set aside and for the decision to be reviewed again.”.[16]I am of the opinion that by amending the Statement of Reasons on 25 May 2009 and then issuing a review decision on 8 June 2009, that the tribunal has not followed the correct procedure outline above; - ie that the tribunal ought to have identified that there was an error of law and determined therefore that the tribunal could review the decision. Only then could the tribunal exercise the power to amend the Statement of Reasons. It appears to me that the decision issued on 8 June 2009 was an attempt to correct that fundamental error. The purported amendment of the Statement of Reasons took place before the salaried Chairman had made a determination that the original decision contained an error of law. This is a breach of Rule 40(2)(b) and section 9(4) of the 2007 Act, which only gives a power to amend the Statement of Reasons where the decision has lawfully been reviewed, in terms of Rule 40(2). I consider this renders the purported review a nullity.[17]The question then also arises as to the consequences of a failure to comply with Rule 40(3) and (4). In my opinion that is also fatal to the review procedure followed by the tribunal, because the parties were not alerted to their right to seek a set aside of that action [the amendment of the Statement of Reasons] and for the decision to be reviewed again - London & Clydeside Estates Ltd v Aberdeen District Council 1980 SLT 81 (HL). In the London & Clydeside case an application was made for a certificate of alternative development under section 25 of the Land Compensation (Scotland) Act 1963. In order to comply with the Town and Country Planning (General Development) (Scotland) Order 1959, art. 3 (3) the certificate ought to have included a statement of the rights of appeal to the Secretary of State, but it did not. Lord Hailsham, the Lord Chancellor said:
“Was this requirement, which has the authority of Parliament behind it, mandatory or was it in some sense directory only? I have no doubt that it was mandatory, and that the failure to include this information was fatal to the certificate. … The validity of the certificate itself is in question, and if, as I believe, the requirement is mandatory, the certificate falls independently of whether the appellants were in fact misled. I find it impossible to accept that a requirement by an instrument of statutory force designed for the very purpose of compelling a public authority to inform the subject of his legal rights can be treated as simply regulatory if the requirement is not complied with. If I required authority for this proposition I would refer to Agricultural, Horticultural and Forestry Industry Training Board v. Kent , Rayner v. Stepney Corporation and Brayhead (Ascot) Ltd. v. Berkshire C.C . notwithstanding that it relied on Edwick v. Sunbury-on-Thames U.D.C . which was disapproved in James v. Secretary of State for Wales , which was decided on an argument irrelevant to the present appeal. However, I am content to assert a general principle to the effect that where Parliament prescribes that an authority with compulsory powers should inform the subject of his right to question those powers prima facie the requirement must be treated as mandatory.”
[18]Following the reasoning in London & Clydeside I consider that Rule 40(3) and (4) is mandatory. Both rules use the word “must” in a Statutory Instrument. Under Rule 40(4) the notice under Rule 40(3) “must state that any party that did not have an opportunity to make representations may apply for such action to be set aside and for the decision to be reviewed again”. I consider the “must” is mandatory and therefore that failure to comply with Rule 40(4) renders the review process a nullity and therefore what is before me is the original decision with its unamended Statement of Reasons. In CDLA/1291/2009 the Deputy Judge of the Upper Tribunal held that there was an invalid review [paragraph 30] and went on to say [paragraph 31] that as he was allowing the appeal for other reasons he did not “need to decide, what, if any consequences flow from the invalid review.” In CSIS/272/09 Judge of the Upper Tribunal Gamble did not have to decide this issue, but followed the suggestions of the parties that he proceed upon the basis of the amended Statement of Reasons, because both agreed that the decision was defective, whether or not the unamended or amended Statement of Reasons was considered. Mr Gamble said “It is thus unnecessary for me to decide the question” as to “what remedy should be granted for the defects in the review”. The original decision[19]I therefore turn to the original decision of the tribunal given on 26/02/2009 and to the Statement of Reasons in their unamended form. I am in no doubt that the Statement of Reasons was inadequate because it did not deal with the substantive argument about Regulation 27(b) and therefore that the tribunal erred in law. I therefore set aside this decision and remit to a differently constituted tribunal to reconsider the appeal. The power to amend the Statement of Reasons[20]I now turn to the power to amend the Statement of Reasons. This part of my reasoning is not necessary to the decision I have made, but I make the comment for guidance.[21]Section 9(4)(b) of the 2007 Act does give the tribunal a power to amend a Statement of Reasons and therefore supersedes Mr Levenson’s decision in CA/4297/2004 that it was not competent to amend a Statement of Reasons. The issue therefore is the circumstances in which such a power ought to be exercised. Considerable guidance is given in both Barke v SEETEC Business Technology Centre Ltd [2005] EWCA Civ 578 and English v Emerty Reimgold & Strick Ltd [2002] 1 WLR 2409 . It is clear from those cases that a tribunal that has failed to give reasons or failed to deal with a particular point may deal with such a lacuna and provide those reasons. I consider the same approach applies to a tribunal, which will generally be expected to act professionally in amending a Statement of Reasons and therefore may, as the tribunal purported to do in this case, deal with the lacuna. I agree with the advice given by Deputy

Judge White in [2009] UKUT 163 (AAC) [CDLA/1291/2009] at paragraph 28, which states:

“28. In cases where (as in this case) the tribunal which decided the case consisted of a panel of three, any subsequent variation of the statement of reasons must reflect issues which were discussed by all three members of the tribunal, but which were then inadvertently not included in the statement written by the chair of the tribunal. If this is not the case, then the decision will not be that of the tribunal which heard the case, but in part that of just one of its members. It would follow that in such cases the chair in revising the statement of reasons should state explicitly (1) that the issue which is the subject of revision was expressly considered and discussed by all members of the tribunal, and (2) what is now added to the statement of reasons represents actual conclusions of the whole tribunal (rather than something which the chair thinks they would have concluded if they had considered the point in issue).”
[22]However, a tribunal that has to decide whether or not to exercise the power to amend a Statement of Reasons should consider whether or not in the particular circumstances it ought to do so. Where a Statement of Reasons deals with a point, but in retrospect can be seen to have dealt with it inadequately or unclearly, then it may be reasonable to amend the reasons to amplify or clarify the point. If an argument is not dealt with in the Statement of Reasons at all, then more careful consideration might have to be given to whether or not the lacuna should be filled by new material in the Statement of Reasons on this point. The length of time since the hearing might be relevant, as might be the availability of contemporary material showing what was the decision and the reasons of the tribunal at the time. These are all matters upon which the parties might want to make representations, which could be of assistance to the tribunal in determining whether or not to consider amending the Statement of Reasons. Allowance of the appeal[23]The claimant will see that in allowing this appeal, I have done so on technical grounds. No inference should be drawn from this decision as to the possible out come on the merits of the rehearing before a differently constituted tribunal. (Signed) SIR CRISPIN AGNEW OF LOCHNAW BT QC Deputy Judge of the Upper Tribunal Date: 3 November 2009

Cited in 1 later judgment