DB v CMEC (CSM) [2010] UKUT 356 (AAC)

UKUT-AAC
DB v CMEC (CSM)
[2010] UKUT 356 (AAC) · 2010-09-30
[1]This case concerns the child support payable in respect of Callum and Tamsin. The appeal was brought by their father, who is their non-resident parent under the child support legislation, with the permission of Upper Tribunal Judge Mesher. The other parties are the Child Maintenance and Enforcement Commission and the children’s mother, who is their parent with care under the legislation.[2]I held an oral hearing at the direction of Judge Mesher in Cardiff’s Civil Justice Centre on 20 July 2010. The non-resident parent attended and spoke on his own behalf. The Commission was represented by Mr Huw James. He spoke in support of the Commission’s written submission. The parent with care was represented by Mr David Burrows of David Burrows Solicitors and Advocates. He had provided a detailed written argument, parts of which he accepted could not apply in this case. I have dealt with the arguments that he put orally. I am grateful to all those who addressed me for their submissions.[3]After the hearing, I directed written submission on the issue of school fees. Those submissions are now complete. I have read what they say, but I have limited my comments to those matters that are with my jurisdiction on this appeal. With regard to some of the points made by the non-resident parent, I do not have any power over any other matters relating to child support or any matters relating to ancillary relief.[4]In this decision, ‘sections’ are from the Child Support Act 1991, ‘the Commission’ is the Child Maintenance and Enforcement Commission, ‘the tribunal’ is the First-tier Tribunal, and unless otherwise stated ‘regulations’ are from the Child Support (Variations) Regulations 2000 (SI 2001 No 156). B. When was the application for a variation made?[5]Judge Mesher raised this issue when giving permission to appeal. I have to consider it first, because it determines the period and circumstances that the tribunal had jurisdiction to consider.[6]There was no dispute that the parent with care made an application for a variation. The issue was: when? I begin with what happened, then explain why the correct analysis is significant, and finally deal with that analysis. On the way, I set out Mr Burrows’ argument and explain why I reject it. What happened[7]I take this history from the Commission’s written submission on this appeal. The parent with care applied for a maintenance calculation by telephone and letter in October 2006. There is no doubt about that. The decision-maker made a decision in November 2006. The parent with care wrote in response to notification of that decision on 4 December 2006; her letter was received on 8 December 2006. The decision-maker treated this as an application for a variation and eventually agreed to a variation in January 2008. That agreement was taken into account on 9 January 2008.[8]The parent with care says that there are other letters that are relevant. However, they cannot be found. They may never have arrived. I must make a decision on the information available. Why it is significant[9]The correct analysis matters because it determines the circumstances that the decision-maker and the tribunal were entitled to take into account. I take the possibilities in turn.[10]The application for a variation may have been made as part of the original application for a calculation. In this case, the decision of November 2006 did not deal with it. Accordingly, that decision could only have been an interim maintenance decision under section 12(2). The decision-maker did not deal with the variation until 9 January 2008. The decision of that date was made under section 11 and replaced the interim maintenance decision by virtue of section 28F(5). On this analysis, the decision under appeal was the decision of 9 January 2008. If this is correct, the tribunal was under a duty to consider any change of circumstances that occurred before that date.[11]Alternatively, the application may have been made on 8 December 2006. In this case, the November 2006 decision was a maintenance calculation decision under section 11. No decision was made on the variation until 9 January 2008. As the application was made within one month of the November 2006 decision, the decision of 9 January 2008 took effect by way of revision of that decision by virtue of regulation 3A(1)(a)(ii) of the Social Security and Child Support (Decisions and Appeals) Regulations 1999. On this analysis, the decision under appeal was the decision of November 2006 as revised on 9 January 2008. If this is correct, the tribunal was not allowed to take account of any change of circumstances that occurred after 11 November 2006: see my decision in R(CS) 1/03 .[12]This difference in the tribunal’s powers is important, because of the change in value of a Spanish property, in which the non-resident parent had a share. Mr Burrows’ argument[13]Mr Burrows accepted that the parent with care had not in terms mentioned a variation when she applied by telephone for a calculation, but argued that the Commission should have treated her application as including an application for a variation. His argument was based on the cumulative effect of:(i) the fact that the non-resident parent was a company director,(ii) who was paying school fees and(iii) had an income for child support purposes of only £5,000 a year. Those circumstances, he argued, inevitably raised the possibility that the non-resident parent was receiving dividends, which could be taken into account under regulation 19(1A).[14]I reject this argument, because(a) the information provided by the parent with care did not allow the decision-maker to treat the application for a maintenance calculation as including an application for a variation and(b) the decision-maker was not under a duty to investigate further.[15]There must be an application for a variation: sections 28A(1) and 28G(1). The application need not be in writing, but it must state the grounds on which it was made: section 28A(4). If the application is not made in writing, it is treated as made on the date when the applicant notifies the desire to make one: regulation 4(2). If an application is made in writing at the applicant’s initiative, it is treated as made on the date when it is received: regulation 4(3).[16]The parent with care never actually applied for a variation. What happened was that the decision-maker treated her as having applied. That was entirely proper. Decision-makers are under a duty to have regard to the substantive nature of an application rather than its legal form. That beneficial approach was encouraged by the Social Security and Child Support Commissioners for over half a century: see R(I) 15/53 at [4] and R(I) 50/56 at [18]. It has been applied, for example, to treat a letter of appeal as an application for a variation: see CCS/1838/2005 at [15]. The decision-maker acted under this duty by treating the parent with care’s letter of 4 December 2006 as an application for a variation. It was not so worded, but its contents referred to the non-resident parent’s life-style, which is one of the grounds for a variation.[17]This approach depends on the information available to the decision-maker. It does not include a duty to investigate. It is merely a duty to apply the most appropriate procedure to the contents of the information provided by the applicant. The information given by the parent with care during her telephone application was not sufficient to raise an issue of a variation. She reported that the non-resident parent was a company director. That would not be sufficient to justify inquiries in respect of regulation 19(1A). For one thing, there was nothing to indicate that he was able to control the amount of income he received. And for another thing, there was nothing in the circumstances to suggest that dividends were in payment. The non-resident parent told me that he had disclosed his dividends when he was telephoned in relation to the application. He was told that they were not relevant as they were not taken into account in the calculation. That was correct. Dividend income can only be taken into account in a variation. Further inquiry might have shown a possible ground for a variation. But, as I have said, this is not a duty to investigate.[18]Decision-makers are under a duty to investigate contradictions of material fact, because it is impossible otherwise to make a decision. The decision of the Commissioner in CIS/0222/1991 is an example. In that case, the claimant had completed a claim form for income support indicating both that her home was leasehold and that it was not. That was an obvious contradiction. The adjudication officer could not determine her claim until the conflict was resolved. The adjudication officer did not investigate and an overpayment resulted. The Commissioner held that the overpayment was not recoverable as it was caused by the adjudication officer's failure to investigate the conflicting information on the claim form. This duty does not assist the parent with care, as there is no contradiction in her application for child support.[19]Decision-makers may also be under a duty to obtain information that is available to them, but not to the applicant. The decision of the House of Lords in Kerr v Department for Social Development , reported as R1/04(SF) , is an example. In that case, the claimant had claimed a funeral payment from the social fund. His entitlement depended on whether or not other relatives of the deceased were in receipt of a qualifying benefit. That information was readily accessible to the Department from its own records, but not to the claimant. The House of Lords held that gathering evidence was a co-operative process and, as the information was readily available to the Department, it was under a duty to provide it. This duty does not assist the parent with care, as the information about the nature of the non-resident parent’s company was either known to the parent with care or was publicly available from Companies House.[20]All the duties that I have considered so far were developed in social security law. In child support law, it is necessary to consider section 2. This imposes a duty on decision-makers to have regard to the welfare of any child likely to affected by ‘the exercise of any discretionary power conferred by this Act’. It is a duty that limits the exercise of the powers conferred by the Act. It may lead a decision-maker not to exercise a power or to exercise it in a particular way. It is not, as that wording shows, a freestanding duty. In order for the duty to apply, it is necessary to identify a discretionary power conferred by the Act for it to qualify. In this case, there is no such power that could assist the parent with care. None of the duties I have mentioned arises under the Act. Conclusion[21]The parent with care did not in terms apply for a variation. As I have explained, the decision-maker was not under a duty either to accept the application for a maintenance calculation as an application for a variation or to investigate for information that might give rise to that duty. On the other hand, her letter of 4 December 2006 did contain sufficient information and was treated, properly, as an application for a variation.[22]The parent with care asked me how she was to know about the possibility of a variation. The answer is that there are sources of information available to anyone who is considering applying for a maintenance calculation. There are leaflets, websites and advisers, all easily identified through libraries or on the internet. It follows from this that there was no official error by the decision-makers involved.[23]The result is that the application was made on 8 December 2006. That was within one month of the date of the maintenance calculation. It was, therefore, treated as an application for a revision. The decision of 9 January 2008 was not itself an appealable decision. It took effect as a revision of the decision of November 2006. That decision, as revised, was the decision under appeal. As a consequence, the decision-maker, and the tribunal, could only take account of circumstances as they were down to the time of that decision in November 2006.[24]This conclusion allows me to deal briefly with the way that the tribunal dealt with the non-resident parent’s share in the Spanish property. C. Did the tribunal deal correctly with the Spanish property?[25]As the change in value of the property did not occur until 2007, the tribunal was not entitled to take that reduction into account. Any mistake that it made in the way it dealt with the evidence did not affect the outcome. Judge Mesher gave permission on the ground that the tribunal may have attached too much significance to the lack of evidence provided by the non-resident parent. Since that evidence related to a change in value after the time of the decision under appeal, any error that the tribunal may have made cannot have affected its decision. D. Just and equitable[26]The next issue concerns the just and equitable requirement that must be applied before any variation is agreed to. The non-resident parent was paying half of the school fees. The tribunal did not include this in the list of matters that it did take into account. The arguments[27]The non-resident parent argued that this was a commitment under an undertaking that was recorded in a court order. He shared this expense equally with the parent with care. It should be taken into account, as it represented a significant expenditure for the benefit of the children.[28]Mr James argued that the tribunal should have dealt with this argument in its reasons, but that it was bound to reject it. He cited the decision of the Commissioner in CSCS/0013/2007 for the propositions that day school fees were outside the scope of the variation scheme and were a matter for the courts under section 8(7) of the Act.[29]Mr Burrows argued that the boarding element of schools fees was potentially a ground for a variation under regulation 13, but that the educational element was always outside the scope of child support and a matter for the courts. Anyway, the non-resident parent’s payment was balanced by the parent with care’s equal payment. Analysis[30]Section 28F(1)(b) imposes a duty on the Commission not to agree to a variation unless ‘it is its opinion that, in all the circumstances of the case, it would be just and equitable’. That is a discretion. There is express provision for some compulsory considerations and some exclusions in regulation 21(1) and (2). Otherwise, it is a discretion without express limitation.[31]School fees cannot simply be deducted from the variation that would otherwise be agreed. That would be a rigid rule and inconsistent with the nature of a discretion. The issue is whether those fees can be taken into account as part of the assessment whether it would be just and equitable to agree to a particular variation.[32]The child support legislation leaves to the courts the power to make orders that a parent pay tuition fees for a child’s education: section 8(7). The Commission has power to agree to a variation in respect of boarding fees under regulation 13.[33]The payment of school fees might be taken into account as a voluntary payment under section 28J. The parents could also agree that the payments should be in discharge of the non-resident parent’s maintenance liability. Or the parent with care could use the maintenance towards school fees. However, the legislation makes no specific provision for school fees to be taken into account. The explanation probably lies in the reasoning of the deputy Commissioner in CSCS/0013/2007 . He decided that school fees paid by one parent could not be taken into account under the just and equitable requirement. He wrote:
‘16. … The CSA is designed to determine the amount of maintenance that should be paid for a child; ie a sum to cover living costs such as clothing, share of housing costs, pocket money and normal non fee paying school expenses etc. The PWC is generally the parent entitled to determine how the maintenance is to be spent on the child’s behalf. If parents decide that a child should be privately educated that is a cost over and above normal maintenance costs. How those fees are paid is a matter for agreement between the parents or failing agreement either parent could seek a court order for payment of the school fees.’
[34]I have not found it easy to decide whether the deputy Commissioner was correct that the amount of school fees paid by a non-resident parent cannot be taken into account in applying the just and equitable test. On the one hand, that test provides a largely unrestricted discretion to take account of the whole of the financial circumstances relevant to both the non-resident parent and the person with care. On the other hand, it must be applied within the context of the child support scheme, which expressly leaves to the court the issue of tuition fees. I have decided that the express legislative division of responsibility between the courts and the Commission indicates that school fees are a matter for the courts and not to be taken into account under the just and equitable test.[35]This does not leave the non-resident parent without recourse. It may be that his combined liability for child support maintenance and his share of the school fees is excessive. There should be a legal mechanism by which his overall liabilities can be taken into account. Section 8(7) preserves that mechanism for the court. The non-resident parent can apply to the court for a more appropriate order in respect of the school fees.[36]I did consider whether the Commission had power to take school fees into account in the exercise of some general discretion on enforcement. With that in mind, I drew the parties’ attention to the decision of Black J in Green v Secretary of State for Work and Pensions [2010] EWHC 1278 (Admin) . I accept the Commission’s submission that that case concerned different legislation and is not relevant under the scheme that governs this case. E. The non-resident parent’s other ground[37]The non-resident parent applied for permission in respect of the assets that were being used in the purchase of his home. The tribunal had only taken two investments into account. There are two answers to this argument. The first is that Judge Mesher refused permission on this ground. The second is, as Judge Mesher pointed out, that the tribunal had dealt with this issue in accordance with the argument put to it by the non-resident parent’s representative. The non-resident parent must live with the case put by his representative. F. Disposal[38]I dismiss the appeal. Signed on original on 30 September 2010 Edward Jacobs Upper Tribunal Judge

Cited in 3 later judgments