The Secretary of State for Work and Pensions v Carmichael and Sefton MBC (2018)

Keywords: Housing Benefit; Human Rights

This was an appeal against an Upper Tribunal judgement (and a preceding First Tier Tribunal’s judgement) which purported to disapply Housing Benefit Regulations 2006 reg. B13 (known as the Bedroom Tax regulations) in the case of a couple who could not share a bedroom, due to disability.

The relevant Housing Benefit Regulations had been declared by the Supreme Court to violate Mrs. Carmichael’s ECHR rights under article 14, taken together with article 8 in R (on the application of Carmichael) v Secretary of State for Work and Pensions [2016].

The incompatibility identified by that the Secretary of State had subsequently addressed judgement by amending the Housing Benefit Regulations (with effect from 1 April 2017). The amendment added two new categories to Regulation B13 (5):

(a) a member of a couple who cannot share a bedroom;

(b) a member of a couple who can share a bedroom;”.

And introduced a new paragraph (6) providing the following definition:

“(6) For the purpose of these Regulations, reference to a member of a couple who can share a bedroom is to a member of a couple where the other member of the couple is a member of a couple who cannot share a bedroom”.

This is a rather impenetrable definition, described by the Upper Tribunal as being “in the best traditions of the dense drafting of social security secondary legislation.”

Nevertheless, the effect of the amendments was to alter the Housing Benefit regulations in such a way that the Carmichaels and other couples unable to share a bedroom, would, from 1 April 2017, no longer have their Housing Benefit reduced.

The present case, therefore, concerned the Carmichaels’ claim for Housing Benefit between March 2013 and 1 April 2017, a period during which their Housing Benefit had been reduced by 14% (as required by the unamended Housing Benefit Regulations). However, throughout that period, they had received Discretionary Housing Payments from the local authority making up the shortfall.

The First Tier Tribunal had attempted to resolve the incompatibility of the unamended regulations with the Carmichaels’ human rights by adding words to the regulation defining the number of bedrooms required for a couple, so as to allow for situations like those of the Carmichaels. 

The Secretary of State’s appeal to the Upper Tribunal had been stayed pending the outcome of the Supreme Court hearing on the human rights case.

Following the Supreme Court’s declaration of incompatibility, the Upper Tribunal concluded that the First Tier Tribunal had not had the power to go as far as adding words in interpreting the regulations.

However, the Upper Tribunal remade the decision, again finding that the Carmichaels were entitled to Housing Benefit without the reduction on the grounds that the UT was obligedto disapply the regulation requiring the reduction in order to act in a manner compatible with human rights.

The two grounds of appeal to the court on a point of law were:

(1) The Upper Tribunal was wrong to find that it and the First-tier Tribunal had the power to devise solutions to Conventionviolations which involved ‘rewriting’ the regulations (which were secondary legislation) whether that ‘rewriting’ involved adding words (as in the FTT decision) or disapplying/not giving effect to words which were present (as in the UT decision).

(2) In devising its solution in this case, the Upper Tribunal erroneously failed to have regard to other payments (in particular DHPs) for which provision had been made by the Secretary of State to make up for reductions in housing benefit.

The appeal succeeded on both grounds.

On ground 1, this was by a majority decision (Sir Brian Leveson Pagreeing with the reasoning of Flaux LJ).

However, Leggatt LJ gave a strong dissenting view on ground 1.

Ground 1:

The Human Rights Act

The majority view:Section 3 of the Human Rights Act required courts and tribunals so far as possible to read and give effect to Regulation B13 in a way which was compatible with Convention rights.

However, the Human Rights Act clearly respected parliamentary sovereignty. It was for Parliament to decide how a provision in secondary legislation, which had been found to be incompatible with Convention rights, was to be rendered compatible.

The UT’s power was limited to a declaration of incompatibility and did not extend torewriting or simply ignoring the Regulation, which was in force at the relevant time.Flaux LJ rejected the argument that the UT would have been acting unlawfully if it had not made the decision it did. While section 6(1) made unlawful acts of public authorities, which were incompatible with a Convention right, section 6(6) specifically excluded the context of a failure to pass remedial legislation. For the UT to rule in the way that it had, required, effectively, the altering of the wording of the existing regulation and this amounted to an impermissible rewriting of the regulation going beyond any permissible interpretation of the legislation under section 3.

Flaux LJ concluded:

“It is clear that, as Mr Eadie QC submitted, the existing powers of courts and tribunals do not include the rewriting of primary or secondary legislation in order to render it compatible with Convention rights.” [Para. 45]

Leggatt LJ’s dissenting view: Whilst it would have been beyond the powers of the UT to disapply primary legislation, secondary legislation was not entitled to the same protection on the grounds of parliamentary sovereignty.

The Human Rights Act specifically drew this distinction. Section 6(1) provided that it was unlawful for a public authority to act in a way incompatible with a Convention right. The exclusions provided in section 6(2) disapplied this requirement only where the legislative provision was found in primary legislation, or, where it was found in secondary legislation, the incompatibility with Convention rights was inherent in the enabling primary legislation. Neither was the case here. So, there was “no constitutional objection to declining to enforce or give effect to such provisions in so far as they are incompatible with Convention rights” [Para.79] because the Human Rights Act (which is primary legislation) required the UT to do so. The UT was further required to apply the effect of the regulation’s incompatibility with Convention rights by section 7(1)(b) Human Rights Act which provided that a person may “rely on the Convention right or rights concerned in any legal proceedings”.

Further, according to Leggatt LJ, the UT’s decision did not amount to rewriting the regulation, which would have been beyond its powers, but merely declined to apply the regulation in the circumstances of this specific case in as far as it had been found by the Supreme Court to be incompatible with the Carmichaels’ human rights. He concluded:

“What is made unlawful by section 6(1) is for a public authority to give effect to or enforce legislative provisions when to do so is incompatible with a Convention right. There is no requirement that the provision(s), which have that effect in the instant case, should also have that effect in other cases or should be capable of severance.

He continued thus:

“…Not giving effect to provisions of subordinate legislation in an individual case where to do so would violate a Convention right does not involve, “re-writing” the legislation. It shows a proper respect for constitutional boundaries by leaving it to Parliament or to the Secretary of State with delegated legislative authority to decide what changes to make to avoid further violations of Convention rights.” [Para. 88 & 89]

The case law

The Majority View: The Upper Tribunal had erred in concluding that the Mathieson case reflected “a consistent line of authority which would justify the approach adopted by the Upper Tribunal in the present case.” [Para. 51]. The Mathieson case had turned on its specific facts. The Supreme Court had specifically declined to extend its judgement in that case in a way which would have changed or redesigned the relevant legislation and had “clearly had in mind the need to preserve legislative choice as to how to render compatible legislation found to be incompatible with Convention rights” [Para. 50]. To the contrary, a careful review of a range of recent cases concerning welfare benefits and compatibility with EHCR rights demonstrated that:

“in cases where primary or secondary legislation has been held to violate Convention rights, the general approach of the Courts is to grant declaratory relief to that effect, but to decline to grant wider declaratory relief which might trespass on the role of the legislature.” [Para. 58]

Leggatt LJ’s dissenting view: Leggatt LJ again provided an alternative interpretation of the authorities, including Mathieson. He viewed them as demonstrating a consistent approach of treating incompatible secondary legislation as having no effect in individual cases, whilst leaving amendments to the regulations to render them compatible as a matter for the Secretary of State, quoting Baroness Hale in In re P and others [2008] UKHL 38 at [116]:

“The courts are free simply to disregard subordinate legislation which cannot be interpreted or given effect in a way which is compatible with the Convention rights. Indeed, in my view this cannot be a matter of discretion. Section 6(1) requires the court to act compatibly with the Convention rights if it is free to do so.”

Ground 2:

The majority view:Mr. Carmichael had received Discretionary Housing Payments, which had made up the shortfall in housing benefit. Consequently he had not actually suffered any financial loss. The UT should have limited itself to making a declaration that the regulation was incompatible with his Convention rights. If the Carmichaels had suffered any loss as a consequence, the remedy would have been to bring a claim for damages in the civil courts under section 8(2) of the Human Rights Act. However, it was notable that no damages had been sought in the Supreme Court case, no doubt because no actual financial loss had been suffered. The UT’s judgement, were it allowed to stand, would have resulted in double recovery i.e. The Carmichaels would have received both Housing Benefit and DHPs for the amount in question.

Leggatt LJ: Leggatt LJ agreed that the UT made an error of law in disregarding the payment of DHPs. However he concluded that the UT’s judgement should simply have been amended to require consideration of any amounts previously paid under DHPs prior to the payment to Mr Carmichael of any difference between the housing benefit recalculated without the under-occupancy deduction of 14% and prior payments of both Housing Benefit and DHPs.

 

Comment:

It is unfortunate that this case further muddies the waters, rather than clarifying how far a court or tribunal can go in correcting the effect of secondary legislation, which has been found to violate a claimant’s human rights. This is of particular concern, given the increasingly heavy reliance placed on secondary legislation to provide the ‘meat’ of legislative provisions (not least in the EU withdrawal bill currently before Parliament).

A substantial amount of time can pass between a declaration of incompatibility by the courts and the bringing into force of amended regulations, particularly in politically sensitive areas where maintaining a ‘tough’ stance may take precedence over accepting the rule of law.

The majority view taken by Flaux LJ and Sir Brian Leveson P would seem to require tribunals (at least) to continue giving effect to secondary legislation even where it has already been found to be incompatible with the Human Rights Act until it is actually amended. This raises the prospect of every individual claimant needing to seek damages in the civil courts under s.8 (2) Human Rights Act in order to correct losses due to unlawful regulations during the gap prior to amendment.

Full text at: http://www.bailii.org/ew/cases/EWCA/Civ/2018/548.html