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2012 UKUT 88 AAC CH 2092 2011<

IN THE UPPER TRIBUNAL                                                             Case No.  CH/2092/2011



Before Judge Mark


Decision:   The appeal is allowed.  I set aside the decision of the tribunal and I substitute my own decision setting aside the decision of the Respondent council that the overpayment of £2700 was recoverable from the Appellant as well as from its former tenant and deciding that the whole of the overpayment is recoverable only from that former tenant.





1.    In this case a lady, JC, was a tenant at a terraced house in Kidbrooke.  The only tenancy agreement in evidence was an assured shorthold tenancy dated 1 May 2008 made between a housing association as landlord and herself as tenant for a term of 6 months at a rent of £400 per week.  She was in receipt of housing benefit awarded pursuant to an application also dated 1 May 2008.  According to the council’s written submissions to the tribunal, although this was not backed up by any documentation, the housing benefit was initially £219.23 per week, and rose to £225.00 per week from 4 May 2009.  It thus appears to have covered only just over half the weekly rent under the tenancy agreement.


2.    The tenancy agreement describes KMP & Sons as her landlord and the housing association as the landlord’s agents, and there is other evidence which confirms that this was the case and that subsequently KMP & Sons took over the management of the property and have had the housing benefit paid directly to themselves by the council since 4 August 2008. 


3.    The 6 months term of the assured shorthold tenancy will have expired at the end of October 2008 and there is no evidence whether it was succeeded by any subsequent assured shorthold tenancy or whether the tenant remained in occupation under a periodic tenancy at the same or some other rent.


4.    It would appear that JC was entitled to housing benefit because she was in receipt of income support.  In September and October 2009, the council discovered first that her claim for income support had become dormant either from 2 June 2009 (file, p.13) or from 8 June 2009 (file p.28), and secondly that she had ceased to live at the Kidbrooke property from about 15 June 2009 when she had moved to an address in Catford (p.19).  As a result of discovering that income support had ceased and that JC had left the property, further payment of housing benefit was suspended, and in due course the council terminated the benefit and determined that there had been an overpayment of benefit totalling £2925 which was recoverable from JC and from KMP & Sons.  The period of overpayment was stated to be from 8 June to 7 September 2009.  This was subsequently varied so as to reduce the amount said to be recoverable from KMP & Sons to £2700 on the basis that they should not be asked to repay the first week’s overpayment while JC was still living at the Kidbrooke property.


5.    KMP & Sons contended that they were not aware that JC had moved out.  The council responded by contending that it was the responsibility of the landlord to be aware when a tenant moves out of a property, especially after a three months period, and that the overpayment had occurred as a result of the delay.  In reply, by letter dated 6 March 2010 (p.39), KMP & Sons stated that it was impossible for them to establish or know any change of circumstances unless they were informed by an outside source.  They stated that the property was inspected every 3 or 4 months but there were times when no access was possible and the situation was very difficult and complicated.  In that type of circumstance they had no option but to believe that the tenant was still in occupation if they had not been informed otherwise.  The letter also stated that they were receiving direct payments only as the tenant had not paid the due rent for over 3 months despite receiving benefits and they had not been paid rent for almost 4 months.


6.    On appeal, KMP & Sons contended that the overpayment had arisen in consequence of a misrepresentation or a failure to disclose on the part of JC, so that the only person against repayment could be sought by virtue of regulation 101(2) of the Housing Benefit Regulations 2006 was JC.  That regulation states, so far as material:


(2) For the purposes of section 75(3)(b) of the Administration Act (recovery from such other person, as well as or instead of the person to whom the overpayment was made), where recovery of an overpayment is sought by a relevant authority –


(b) in a case where an overpayment arose in consequence of a misrepresentation for or a failure to disclose a material fact (in either case, whether fraudulently or otherwise) by or on behalf of the claimant, or by or on behalf of any person to whom the payment was made, the overpayment is only recoverable from any person who misrepresented or failed to disclose that material fact instead of, if different, the person to whom the payment was made;”


7.    In this case, it was and is contended by KMP & Sons, the overpayment arose in consequence of a failure by JC to disclose her change of address and cessation of her income support.  They had only come to know of the departure of JC when they had heard from the council on 24 September 2009, when they then took possession of the property using a duplicate key which they held for emergency purposes (p.45).


8.    At the tribunal hearing, it was contended on behalf of the council that KMP & Sons had reason to be aware that JC had moved out and needed to conduct their business in a reasonable manner.  In response, the representative of KMP & Sons appears to have contended that a tenant had to have peaceable use of the premises and that they had no reason to go there or to know that JC had vacated.  They were not informed and the keys were not returned.


9.    MP, who had been corresponding on behalf of KMP & Sons, was not at the hearing.  He had informed the tribunal that he would be out of the country on the date fixed for the hearing and had sought an adjournment but this had been refused, it being stated that he could make written representations and get somebody else to represent KMP & Sons.  As a result, KMP & Sons was represented by somebody else from the KMP Group.


10.The tribunal disallowed the appeal and concluded that there was an overpayment, which was not in dispute, and that it was recoverable not from KMP & Sons but from MP.  There was no evidence that MP was the sole principal of KMP & Sons.  The decision notice went on to state that landlords had to be extra vigilant when receiving rent payments direct and it carried risks as well as benefits.  MP had left it too long without checking to see if his tenant was still at the property.  He could have left a note if she did not answer the door.  He could have given a date and time when he would call and admit himself to the premises to check on occupation.  He had left it too long without checking on the occupancy of the premises.  He had been too inactive.  In the statement of reasons the tribunal adopted these findings and concluded that MP had been too inactive on checking on his tenants.  The landlord had a duty to manage the property and to keep himself informed as to the tenant’s whereabouts.  The period for which JC had not been contacted or checked upon was simply too long to absolve the landlord from responsibility.


11.Under regulation 101(1), provision is made for overpayments not to be recoverable from the person to whom the payments were made if certain conditions are satisfied.  Those conditions include the relevant authority being satisfied that the overpayment did not occur as a result of any change of dwelling occupied by the claimant as her home (reg.101(1)(bb)) and the landlord not having acted, or neglected to act, in such a way as to contribute to the period, or the amount, of the overpayment (reg.101(1)(d)(ii)). 


12.It appears to have been these provisions that the tribunal had in mind in its findings as to the failure of KMP & Sons to check that JC remained in occupation of the property, although even then it does not appear to me to be reasonable to expect a landlord to carry out repeated checks on the continuing occupancy of the property or to visit the property at regular short intervals unless there is special cause to do so.  I note that JC was in arrears with her rent, although some of it was being paid by the council.  That might have led the tribunal to investigate what steps the landlord had taken to seek to recover those arrears.  Such steps might, but need not, have involved visiting the property, but would not have involved the landlord using a key to gain entrance to it if nobody was there in the absence of grounds for suspicion that they had left.  This might have involved an examination of any previous rental defaults while the tenant was at the property.  


13.It does not appear to me that the failure of the landlord to investigate, at some unspecified time between mid-June and mid-September 2009 whether the claimant was still at the property would fall within regulation 101(1)(d)(ii) in the absence of some cause for suspicion that she might have left, and this would in any event be irrelevant for the purposes of regulation 101(1), since by virtue of regulation 101(1)(bb), if she had left, the landlord could not rely on regulation 101(1).


14.All this is, however, immaterial in the present case.  KMP & Sons did not base their case on regulation 101(1) but on regulation 101(2).  This provision is made under section 75(3)(b) of the Social Security Administration Act 1992 which provides that an amount recoverable under that section (which this overpayment is) shall be recoverable where regulations so provide from such other person (as well as or instead of the person to whom it was paid) as may be prescribed.  Regulation 101(2)(b), which I have set out in paragraph 6 above, specifically provides that where the overpayment is the result of a failure to disclose by or on behalf of the claimant, the overpayment is only recoverable from the claimant instead of, if different, the person to whom the payment was made. 


15.In the present case the overpayment was in consequence of JC failing to disclose that she no longer lived at the property and that her income support had ceased.  Accordingly, as a result of regulation 101(2)(b) the overpayment was not recoverable from KMP & Sons.  It may have been different if there were facts of which the landlord was aware, but to which he turned a blind eye, that should have led him to conclude that it was likely that the tenant had left.  He may then have come under a duty to disclose those facts to the council, but there is no suggestion or evidence of any blind eye being turned in the present case.


16.For the reasons which I have given, the tribunal plainly erred in law, and I set aside its decision.  As the undisputed facts clearly bring the case within regulation 101(2)(b), I substitute my own decision allowing the appeal and setting aside the overpayment decision of the council as against KMP & Sons.  JC remains liable and has not appealed the decision as it affects her.



(signed on the original)      Michael Mark

                                                Judge of the Upper Tribunal


                                                9 March 2012