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Cite as: [2005] EWHC 1160 (Admin)

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Neutral Citation Number: [2005] EWHC 1160 (Admin)
CO/3851/2004

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
DIVISIONAL COURT

Royal Courts of Justice
Strand
London WC2
8th March 2005

B e f o r e :

LORD JUSTICE MAURICE KAY
MR JUSTICE MOSES

____________________

NANCY EYESON (CLAIMANT)
-v-
MILTON KEYNES COUNCIL (DEFENDANT)

____________________

Computer-Aided Transcript of the Stenograph Notes of
Smith Bernal Wordwave Limited
190 Fleet Street London EC4A 2AG
Tel No: 020 7404 1400 Fax No: 020 7831 8838
(Official Shorthand Writers to the Court)

____________________

MR M FENHALLS (instructed by Pictons) appeared on behalf of the CLAIMANT
MR R GREGORY (instructed by Milton Keynes Council) appeared on behalf of the DEFENDANT

____________________

HTML VERSION OF JUDGMENT
____________________

Crown Copyright ©

    Tuesday, 8th March 2005

  1. MR JUSTICE MOSES: This is an appeal by way of case stated from the decision of the Milton Keynes Magistrates' Court, a division of the Thames Valley Justices. The decision was made on 29th April 2004. The appellant was convicted of two offences of failing to give a prompt notification of a change of circumstances with a view to obtaining Housing Benefit and Council Tax Benefit contrary to section 112(1A) of the Social Security Administration Act 1992. The obligation on the appellant to notify the change of circumstances arose as a result of the increase in the level of Working Families' Tax Credit being paid to her with a view to obtaining Housing Benefit and Council Tax Benefit.
  2. The facts of the matter

  3. The conclusions of the justices and the questions they pose are fully set out in the case which I annex to my judgment. It is therefore unnecessary, save for the purposes of the resolution of the particular arguments, to deal with the facts further at this stage.
  4. The first submission advanced on behalf of the appellant, is that her failure to notify the Housing Benefit Department of her change in circumstances related to a tax credit and was therefore outwith the provisions of section 112(1A) of the Social Security Administration Act 1992.
  5. In order to deal with that submission it is necessary to identify the statutory scheme into which section 112(1A) of the 1992 Act falls. The Working Families' Tax Credit is defined in the Tax Credits Act of 1999. Section 1(1) provides:
  6. "Family credit and disability working allowance shall be known, respectively, as working families' tax credit and disabled person's tax credit."
  7. Section 112(1A) of the Social Security Administration Act 1992 was inserted by section 16(3) of the Social Security Fraud Act 2001. Section 112(1A) provides:
  8. "A person shall be guilty of an offence if -
    (a) there has been a change of circumstances affecting any entitlement of his to any benefit or other payment or advantage under any provision of the relevant social security legislation;
    (b) the change is not a change that is excluded by regulations from the changes that are required to be notified;
    (c) he knows that the change affects an entitlement of his to such a benefit or other payment or advantage; and
    (d) he fails to give a prompt notification of that change in the prescribed manner to the prescribed person."
  9. The question thus arises whether there has been a change of circumstances affecting any entitlement to any benefit under any provision of the relevant social statutory legislation. The answer is plain. There was such a change of circumstances, namely an increase in tax credit which affected this appellant's entitlement to Housing Benefit. But the crucial question which arises in this part of the appeal is whether the changes were changes which are required to be notified. One possibility is that it is a change that is excluded by regulations from the changes that are required to be notified (see Section 112(1A)(b)). In my judgment it would be odd if this change was excluded by regulations since we have not been referred to those regulations. The question is whether there is an obligation to refer as a result of paragraph 13 of schedule 2 of the Tax Credits Act 1999. Paragraph 13 of schedule 2 of the Tax Credits Act 1999 provides in the relevant parts:
  10. "13. The following sections -
    (a) sections 111A and 112 of the Social Security Administration Act 1992 (dishonest and fraudulent representations)...
    ...
    Shall not apply in any case where the benefit or other payment or advantage is or relates to, or the failure to notify relates to, tax credit."
  11. Thus the statutory question turns on whether the benefit or the failure to notify relates to tax credit. It is necessary, first, to consider whether the benefit relates to a tax credit. In my judgment it is clear that it does not. The benefit to which paragraph 13 of schedule 2 refers relates back to the benefit identified in Section 112(1A)(a) of the Social Security Administration Act 1992 in its reference to a change of circumstances affecting any entitlement of his to any benefit. The benefit is plainly Housing Benefit and thus the first part of the full-out words of paragraph 13 of schedule 2 do not apply since the benefit does not relate to tax credit as defined in section 1(1) of the Tax Credits Act 1999.
  12. The next question posed by the statute is whether the failure to notify relates to the tax credit. That is a reference back to Section 112(1A)(d), namely whether there has been a failure to give a prompt notification of that change. That change in (d) itself refers back to (a) of subsection (1A), namely a change of circumstances affecting any entitlement to Housing Benefit. It is important to recall that the change of circumstances affects the entitlement to Housing Benefit. The failure to notify does not affect any entitlement to tax credit but rather to Housing Benefit entitlement which is affected, and was affected in the instant case, by the increase in the Working Families' Tax Credit.
  13. It is true that the change of circumstances does consist of an alteration in the level of tax credit, but it does not affect entitlement to that tax credit. In those circumstances, whilst the change of circumstances may be said to relate to the tax credit, the failure to notify does not, because the notification requirement in issue relates to Housing Benefit and not to tax credit. The failure to notify does not thus relate to tax credit within paragraph 13 of schedule 2 of the Tax Credits Act 1999.
  14. I conclude that on the wording of paragraph 13, read in the context of Section 112(1A) of the 1992 Act that the operation of Section 112(1A) is not excluded. My conclusion is fortified by the statutory scheme. The Tax Credits Act of 1999 places the responsibility of administration on the board which is defined by section 18 of the 1999 Act as the Commissioners of Inland Revenue. Responsibility is not placed on the Housing Benefit Department of a local authority (see section 5).
  15. The 1999 Act contains its own discrete code of penalties. By section 9(1) of the Tax Credits Act 1999:
  16. "Where a person fraudulently or negligently makes any incorrect statement or declaration in connection with a claim for tax credit, he shall be liable to a penalty not exceeding the amount of the difference specified in subsection (2) below."
  17. It is not surprising, therefore, that in relation to any incorrect statement in connection with a claim for tax credit, there should be exclusion of any sanction for such a failure from the provisions of sections 112(1A) of the 1992 Act.
  18. The plain purpose of paragraph 13 schedule 2 of the 1999 Act is to avoid duplication. If the claimant was correct there would not only be no duplication, but there would be a gap in the enforcement of the obligations of notification. There would be no mechanism for enforcing obligations to notify of a tax credit affecting entitlement to Housing Benefit. Mr Fenhalls responded that it must be recalled that these are offences of strict liability and in those circumstances the court should not be surprised at any such gap. After all, it is open, so he argued, to the Housing Benefit Department to reclaim any overpayment.
  19. I reject that argument. Looking at the statutory scheme as a whole it is plain that paragraph 13 schedule 2 plays an important part in avoiding duplication and in avoiding any administrative difficulties caused by the fact that the administration in relation to tax credits is undertaken by a separate organisation from that which might be affected by a tax credit, namely Housing Benefit.
  20. In those circumstances I answer the question in the case stated at paragraph 15(a) in the affirmative. I should pause to observe that the ingenuity of the arguments advanced on behalf of the appellant by her solicitor at the trial were themselves engendered by a note to section 112 in Stone's Justices' Manual at paragraph 8/29093(1). The author of Stone's observed that the provisions of that section do not apply in cases where any benefit or other payment or advantage is or relates to, or the failure to notify relates to, tax credit. That note is accurate so far as it goes since it reproduces the wording of the paragraph, but perhaps it does not go far enough in saying that it may provide no defence to a claim which relates to Housing Benefit as the justices themselves concluded. It may therefore be that the decision of this court ought, itself, to be noted at that point in that invaluable volume.
  21. I turn then to the next argument that is advanced on behalf of the appellant which relates to the time at which this prosecution was brought. As is apparent from the case stated, the offences related back to 10th April 2002 and 1st October 2002, there being a typographical error at paragraph 14 of the case stated.
  22. Allowing some time for the elastic concept of "as soon as reasonably practicable", the offences therefore ought to have been prosecuted within 12 months from May or November 2002 pursuant to section 116 of the Social Security Administration Act 1992. By section 116(2)(b):
  23. "(b) proceedings for an offence under this Act relating to housing benefit ... may be begun at any time within the period of 3 months from the date on which evidence, sufficient in the opinion of the appropriate authority to justify a prosecution for the offence, comes to the authority's knowledge or within a period of 12 months from the commission of the offence, whichever period last expires."
  24. By section 116(3):
  25. "For the purposes of subsection (2) above -
    ...
    (b) a certificate of the appropriate authority as to the date on which such evidence as is mentioned in paragraph (b) of that subsection came to the authority's knowledge shall be conclusive evidence of that date."
  26. It should be noted that there is some mystery contained within the case as stated by the justices. At paragraph 3 they refer to the fact that informations were accompanied by a certificate that sufficient evidence, in the opinion of the council, to justify a prosecution came to the council's knowledge on 23rd September. But as the case stated records, no reference was made to this certificate during the hearing, and those representing the appellant were unaware of its existence until the time came for the drafting of the case. I should add that Mr Fenhalls and his instructing solicitor have still seen no such certificate.
  27. It is plain from the case stated that the timing point, raised by the appellant's solicitor at the close of the prosecution case, was not disposed of by reference to any certificate, but rather in relation to the question whether, apart from any certificate pursuant to section 116(2)(b), sufficient evidence in the opinion of the appropriate authority to justify a prosecution had come to the authority's knowledge earlier than 23rd September 2003.
  28. In my judgment it is not open to the council now to rely upon the certificate. It was not before the justices. It was therefore not evidence before them, conclusive or otherwise. The court was told by counsel for Milton Keynes, Mr Gregory, that a search for the certificate had been made, but it is quite apparent that no certificate was produced to the justices as they themselves recall.
  29. The question therefore is whether there was sufficient evidence, in the opinion of the appropriate authority, to justify a prosecution, and whether these proceedings were brought within the period of three months from that date. The justices, as is apparent from the case, set out in detail the evidence of the benefit fraud investigator, Mr Pryke, as to the steps he took to ascertain whether such information had been forthcoming. The justices, it is important to observe, at paragraph 9(b) recorded:
  30. "It is accepted that all the documentary evidence sufficient to justify a prosecution was available to the Council by 10th February 2003."
  31. It is important also to observe that no further evidence was forthcoming. As is apparent from the council, the appellant was given three opportunities to attend for interview. She failed to do so, but the council proceeded on the basis of the evidence they already had, and, as is found by the justices, already had by 10th February 2003.
  32. I am prepared to accept that the council might have taken the view, it being dependent upon their opinion, that despite documentary evidence sufficient to justify a prosecution, they needed more in order to establish or prove the knowledge of the appellant for the purposes of section (1A)(c). But no such evidence was given before the justices. No such fact was found by the justices. On the contrary, notwithstanding that section 116(2)(b) of the 1992 Act was cited to them, all they say, at paragraph 11, was that there was a satisfactory explanation for the delay. That, of course, is not the statutory test. There is no finding, other than the finding to which I have already referred (section 9(c)), that there was a later date when the council took the view, or had the opinion, that there was sufficient to justify a prosecution after 10th February 2003.
  33. In those circumstances it seems to me impossible for the authority, as they have sought to do in very fair arguments advanced by Mr Gregory, to rely upon the three requests for interviews which went unanswered. They had been arranged in April, May, 11th September and, finally, 23rd September 2003. There is no basis for saying that absent the opportunity given to the appellant to attend those interviews, the local authority had the opinion that there was insufficient evidence to justify a prosecution.
  34. Indeed, Mr Gregory advanced the sensible point that the local authority might have wished to consider, as a result of any interview, whether it was in the public interest to prosecute this lady. So they might. Interviews would have afforded a sensible opportunity for them to consider that important point. The difficulty with that argument is that section 116(2)(b) does not refer to any public interest requirement but focuses particularly upon a sufficiency of evidence requirement in the opinion of the local authority. It is not, therefore, open to them to delay on the basis that they need more information before deciding whether it was in the public interest to prosecute the lady.
  35. The difficulties could so easily have been avoided had the local authority had available a photocopy of the certificate, which it is now asserted was in existence, which could either have been available at the court or sent in advance, when the decision was made to prosecute in order to explain why it was that proceedings were being brought so long after the events to which they relate in April and October.
  36. It is plain that by December the local authority must have been aware that the appellant had knowledge that increase in her entitlement to tax credit did indeed affect her entitlement to Housing Benefit because she herself reported that matter on 3rd December 2002 (see paragraph 14 of the case stated). In those circumstances I am driven to the conclusion that the prosecution in relation to both these two offences was outside the time limit in section 116(2)(b). Accordingly on that basis I would allow this appeal and answer the question at paragraph 15(b) in the negative.
  37. That conclusion makes it unnecessary to consider the final point, advanced with becoming diffidence by Mr Fenhalls on behalf of Ms Eyeson, that there was insufficient evidence to conclude that the appellant was guilty of the offences with which she was charged. The careful way in which the justices detail her evidence shows that that is an impossible submission. Since I conclude in her favour in relation to her argument as to delay, she succeeds, and I for my part would draw a veil over those final submissions.
  38. For the reasons I have given I would allow this appeal.
  39. LORD JUSTICE MAURICE KAY: I entirely agree. It follows that the questions (a) and (b) will be answered as indicated by my Lord. The appeal will be allowed, the conviction and sentence quashed.
  40. MR FENHALLS: So my Lords know, she has performed the community service which she was required to perform already, but it is a matter of record for my Lords.
  41. LORD JUSTICE MAURICE KAY: She cannot have a credit for that.
  42. MR FENHALLS: I understand she has paid costs of 160 which were awarded in the Magistrates' Court. I invite my Lords to draw in the quashing of the conviction.
  43. LORD JUSTICE MAURICE KAY: Yes, certainly. Costs here, what happens to those?
  44. MR FENHALLS: My Lord, a representation has been granted by Nicholas Blake QC so it will be taxed in the usual way.
  45. LORD JUSTICE MAURICE KAY: Very well. Thank you both very much indeed.
  46. ANNEX

    IN THE HIGH COURT OF JUSTICE

    QUEEN'S BENCH DIVISION

    Between

    Nancy EYESON

    Appellant

    and
    Milton Keynes Council

    Respondent

    Case stated by Mrs J Lousada, Mrs A L Pocock and Mr M Griffiths,

    Justices for the Thames Valley Commission Area, acting in and for the Petty Sessions Area of Milton Keynes in the County of Buckingham, in respect of their adjudication as a Magistrates' Court sitting on the 29th April 2004 at 301 Silbury Boulevard, Witan Gate East, Milton Keynes, MK9 2AJ.

    CASE
  47. On 20th November 2003 an information was laid by the Respondent against the Appellant that she, on or about the 2nd April 2002, failed to give a prompt notification of a change of circumstances with a view to obtaining Housing Benefit and Council Tax Benefit, namely that she was in receipt of Working Families Tax Credit in the sum of 75.00 per week, contrary to Section 112(1A) of the Social Security Administration Act 1992 as amended by Section 16(3) of the Social Security Fraud Act 2001.
  48. On 20th November 2003 an information was laid by the Respondent against the Appellant that she, on or about the 1st October 2002, failed to give prompt notification of a change of circumstances with a view to obtaining Housing Benefit and Council Tax Benefit, namely that she was in receipt of Working Families Tax Credit in the sum of 79.56 per week, contrary to Section 112(1A) of the Social Security Administration Act 1992 as amended by Section 16(3) of the Social Security Fraud Act 2001.
  49. The informations were accompanied by a certificate under Section 116(3)(b) Social Security Administration Act 1992 signed by Mark Jones, Head of Legal and Property Services and Solicitor, Milton Keynes Council, certifying that sufficient evidence in the opinion of the Milton Keynes Council to justify a prosecution came to the Council's knowledge on 23rd September 2003. No reference was made to this certificate during the hearing and those representing the Appellant state that they were unaware of its existence until they had sight of the draft case.
  50. The Appellant pleaded not guilty to both informations on 9th January 2004. The Appellant was represented by Mr D Clark of Messrs Pictons Solicitors, Ashton House, 409 Silbury Boulevard, Central Milton Keynes, Buckinghamshire, MK9 2LJ.
  51. We heard the said informations on the 29th April 2004.
  52. As a preliminary point we heard the following submissions:
  53. (a) It was contended for the Appellant that, if the benefit received by a person or the change in circumstances that he or she failed to notify related to Working Families Tax Credit, Section 112 Social Security Administration Act 1992 did not apply. We were referred to Stone's Justices' Manual 2003, Volume 3, paragraph 8-29091, footnote 1 where it is stated that Paragraph 13 of Schedule 2 to the Tax Credits Act 1999 does not require notification of receipt of tax credit. Section 18 Tax Credits Act 1999 defines "tax credit" as Working Families Tax Credit or Disabled Person's Tax Credit. It was submitted that failure to notify receipt of Working Families Tax Credit is thus excluded from prosecution under Section 112 Social Security Administration Act 1992.
    (b) It was contended for the Respondent that the purpose of Paragraph 13 of Schedule 2 to the Tax Credits Act 1999 was to demarcate Section 9(1) of that Act which provides that where a person fraudulently or negligently makes any incorrect statement or declaration in connection with a claim for tax credit, he shall be liable to a penalty. That failure to notify related to circumstances in which tax credit has been obtained with the Tax Credits Act 1999 did not exclude prosecution for obtaining Housing Benefit or Council Tax Benefit under Section 112 Social Security Administration Act 1992.
  54. We were of the opinion that Paragraph 13 of Schedule 2 to the Family Tax Credits Act 1999 did not prevent prosecutions relating to the obtaining of Housing Benefit or Council Tax Benefit under Section 112(1A) Social Security Administration Act 1992, even where the alleged failure to notify a change in circumstances related to a change in the amount of tax credit to which the individual in question was entitled. In our view, Paragraph 13 only excludes prosecutions relating to the obtaining of tax credits. Section 9 of the 1999 Act instead provides a separate regime of revenue penalties for those who fraudulently obtain tax credit.
  55. The following facts were not in dispute:
  56. (a) The Appellant made two applications for Housing Benefit and Council Tax Benefit.

    (b) The first such application was made on 5th November 2001 and received by the Respondent on 17th November 2001. The Appellant stated she was working as a sales advisor at Debenhams PLC and in receipt of Child Benefit amounting to 72.40 pcm and Working Families Tax Credit amounting to 273.43 pcm. Accompanying the application was a certificate of earned income completed and signed by the Appellant confirming that her gross income from her employment amounted to 666.90 pcm. The Appellant also provided a copy of her Tenancy Agreement showing her net rent as 71.42 payable weekly.

    (c) The Appellant made a further application for Housing Benefit and Council Tax Benefit dated 3rd December 2002. This was received by the Respondent on 3rd December 2002. Income from earnings at Debenhams PLC was shown as 158.70 per week. Child Benefit was received at 70.20 every 4 weeks. Working Families Tax Credit was received of 159.12 every 2 weeks i.e. 79.56 per week. The Appellant's rent was 62.73 per month.

    (d) The Appellant's Working Families Tax Credit was altered twice. With effect from 1st April 2002 it increased to 75.00 per week from 1st October 2002 it increased to 79.56 per week. Housing Benefit was paid at the same rate from 1st April 2002 to 1st October 2002.

  57. The following is a summary of the evidence given by each witness for the Respondent:
  58. (a) We heard evidence in chief from David PRYKE, a Benefit Fraud Investigator employed by Milton Keynes Council, that the Appellant's case was referred to him following an electronic sweep to check Working Families Tax Credit against Housing Benefit. The sweep showed that for the period 1st October 2002 to 1st March 2003 the rate of Housing Benefit payable to the Appellant was 79.56. When Milton Keynes Council carried out an electronic sweep on 29th November 2002 the rate was 61.79. A fraud file was raised on 6th February 2002. The Council's records were accessed and the period in question checked to ascertain that any notification had not been overlooked. An exhibit bundle was produced containing application forms and letters relating to the Appellant's claim for Housing Benefit during the relevant period 5th November 2001 to 4th February 2003. The applicant showed Child Benefit received at 72.40 per month and Working Families Tax Credit at 273.43 per month. There was a certificate of earned income of 666.90 per calendar month and a letter from the Inland Revenue dated 5th October 2001 stated that Working Families Tax Credit was payable to the Appellant at the rate of 61.79 per week for a period of 26 weeks. There was a signed declaration by the Appellant dated 5th November 2001. A further Housing Benefit claim form was submitted by the Appellant dated and received 3rd December 2002 which showed Child Benefit received of 70.20 every 4 weeks, Working Families Tax Credit awarded at 159.12 every two weeks, net weekly take home pay of 158.70, rent payable monthly of 62.73 together with a signed declaration by the Appellant dated 3rd December 2002. There was a letter dated 26th February 2002 from Warden Housing Association Limited to the Appellant notifying a change in rent payable with effect from 1st April 2002. The letter was actioned by the Milton Keynes Council and endorsed accordingly 8th April 2002. A letter from the Milton Keynes Council dated 9th October 2002 confirmed that the Appellant's benefit had been reassessed as a result of a change of circumstances. The Respondent wrote to the Appellant on the 18th December 2002 requesting proof of payment of Working Families Tax Credit for the period April 2002 to September 2002. A letter from the Inland Revenue dated 10th February 2003 to the Milton Keynes Council confirmed awards of Tax Credit to the Appellant starting 2nd April 2002 and ending 30th September 2002 in the sum of 75.00 per week and an award from 1st October 2002 ending 31st March 2003 in the sum of 79.56 per week. As there was no mention of this on the Council's records system, the Appellant was called in for interview on 27th March 2003.

    The interview did not go ahead as the Appellant wished to consult a Solicitor. Further interviews were arranged for 9th April 2003, 9th May 2003, 11th September 2003 and finally 23rd September 2003. There was no response from the Appellant and the file was prepared for prosecution.

    (b) During Cross-examination Mr PRYKE told us that the Appellant did submit all information in November 2001 in an application form 24 pages long. Working Families Tax Credit is not one of the benefits itemised in the form except under 'any other benefits'.

    The award letter states that Working Families Tax Credit will start 2nd October 2001 the original was seen by the Respondent on 16th November 2001. The claim form for Housing Benefit can be sent by post or collected from the Housing Benefit Office. It would have been sent to the Appellant in November 2001. The electronic sweep shows a discrepancy and raises suspicions. The documents printed off the Council's imaging system on 6th February 2003 showed that the benefit payable to the Appellant had gone up and confirmed the dates and amounts. The Appellant's file was studied for the period 5th November 2001 to December 2002. A search was made for any missed correspondence and checked 10 to 12 times. The Housing Benefit Office is a separate office and all mail goes to Saxon Court. It is accepted that anyone can make a mistake and that documents can be mis-filed but it is not accepted that this happened in this case. It is accepted that all the documentary evidence sufficient to justify a prosecution was available to the Council by 10th February 2003.

    (c) We heard evidence from Gill LONG, employed by Milton Keynes

    Council, that she clarified payments and updated the system due to an overpayment. The overpayment was recalculated at a lower rate - for every 1 of income 65 pence would be lost in Housing Benefit. Once the information was received on the new award the new entitlement had to be input. The second application is a review form. Working Families Tax Credit was higher and the outcome was that there had been two six monthly Tax Credit awards not notified which needed to be calculated and adjusted. A letter dated 4th February 2003 to the Appellant shows the extent of the overpayment for the period 1st April 2002 to 8th December 2002 as 335.17. The letter dated 18th December 2002 from Benefits Officer Sonia Howse to the Appellant requests proof of the award of Working Families Tax Credit for the period April 2002 to September 2002.

    (d) During cross-examination, Ms LONG told us that prescribed legislation required that Working Families Tax Credit be taken into account in assessing housing and Council Tax Benefits.

    (e) We heard evidence from Olive KING, Administration Support Team Leader at Milton Keynes Council, that she was responsible for supervising the reception and front office. This included overseeing the production of documents by those in receipt of benefit and the scanning of documents produced as part of the process of notifying a change in circumstances. There were 15 members of staff in the section. The procedure used was to stamp the copy of the document to confirm that the original had been seen. The copy was placed in a plastic folder and sent for scanning. A receipt could be given to the person producing the document if requested. Receipt books to cover the period 14th December 2001 to 17th January 2003 were produced and it was confirmed that no receipt had been issued to the Appellant during that period.

    (f) During cross-examination Ms KING stated that all paperwork came into her section which was open from 9.00 a.m. to 5.15 p.m. There was a rota shift in operation in 2002 with a total of four receptionists. It was not known if anyone had left nor if any agency staff or temporary staff had been employed during 2002, but there had been no work experience person at that time. There was no knowledge of any complaints made about documents being misplaced. It would be unlikely that post would get misplaced and it would not be possible for post to be mis-filed. The person who takes the post is the person responsible for handing it to the scanner. The document is scanned into a general file and then onto the claim file. There are five indices if your circumstances change and you have to notify the change on a change of circumstances form. The form, held at reception, is a prescribed form and if it is not scanned the person delivering it does not get a copy. A receipt for the document is not issued unless requested. If there is no receipt there is no proof. An original document, if it is a letter, would be scanned straight away.

    (g) We read a statement under Section 9 of the Criminal Justice Act 1967 from Sarah HEATON, a Multi Agency Officer in the Tax Credit Office at Preston, Lancashire. A notification letter was sent to the Appellant on 28th March 2002 confirming an award of 75.00 per week Family Tax Credit based on earnings of 131.91 per week. A further letter was issued on 25th September 2002 confirming an award of Family Tax Credit of 79.56 per week based on earnings of 132.76 per week. Copies of the letters were sent to Milton Keynes Council.

  59. We heard the following submissions as to whether or not there was a case to answer:
  60. (a) It was contended for the Appellant that by virtue of Section 116(2)(b) Social Security Administration Act 1992 the prosecution was brought outside of the time limit. The time limit began either 12 months from the date of the commission of the offence or three months from the date of which evidence came to the knowledge of the prosecution. The allegations related to 2nd April 2002 and 1st October 2002 and the proceedings were not commenced until 20th November 2003. David PRYKE had given evidence that he received all relevant documentation between 6th February and 10th February 2003. The time limit had expired when the proceedings were issued.
    (b) It was contended for the Respondent that the evidence adduced established a prima facie failure to declare the receipt of Working Families Tax Credit. On three occasions an interview was set up and the Appellant did not respond. The last interview was arranged for 17th September 2003 following which the proceedings were issued. This was within the period of three months when sufficient evidence to justify prosecution came to the Respondent's knowledge.
  61. We were of the opinion that there was a case to answer and rejected the submission, taking the view that the Respondent had satisfactorily explained the reasons for the delay in instituting the proceedings, namely the failure of the Appellant to attend for interview on three occasions. The certificate under Section 116(3)(b) of the Social Administration Act 1992, which would have been conclusive evidence of the date on which sufficient evidence came to the Respondent's knowledge, was not adduced as evidence before us and we were not aware of its existence at the time we made our decision.
  62. The following is a summary of the evidence given for the Appellant:
  63. (a) We heard evidence form the Appellant that she was 31 years of age, a single mother to a daughter aged 8 years. She had lived in Milton Keynes since 1998. During 2002 and preceding years she had been working part time and receiving Working Families Tax Credit and claiming Housing Benefit. She received a letter like a form from Milton Keynes Council on or about November 2002 and went to Saxon Court and handed it in. Her Working Families Tax Credit was reassessed every six months by the Inland Revenue and she knew that she had to notify the Housing Benefit Office of any changes. In April 2002 she received a letter from the Inland Revenue informing her that her Tax Credit had increased. As far as she was concerned, she had notified the Council of this change. She had attended Saxon Court with a wage slip, her tenancy agreement and the letter from the Inland Revenue and had completed a one-page form given to her by the receptionist. The receptionist had then copied all the documents produced by her, stamped the copies and returned the originals except the change of circumstances form. She was not aware that a receipt could be obtained. In October 2002 her Working Families Tax Credit was increased again. She did attend at Saxon court but not immediately. She always completed the forms. She received the annual renewal of Housing Benefit form towards the end of the year which she completed. In March 2003 a letter arrived asking her to go to the office of Milton Keynes Council. She phoned Pictons Solicitors to book an appointment and Mr PRYKE rearranged her appointment at the Council. She received another letter from the Council but was still trying to get legal advice. The letter was sent in September 2003 regarding the interview, but she probably didn't get round to doing it.

    (b) During cross-examination the Appellant confirmed that she had lived at the address since 1998 and had been receiving Housing Benefit for some time, but not to begin with as she was unaware that she was entitled to it. She accepted that if there was any change in her circumstances she had to inform Milton Keynes Council as she had signed the declaration contained in the form. She accepted she did not notify the Council until December 2002 of the change to her Tax Credit and that she had received the letter dated 5th September 2002. Documents were provided to the Council on 3rd December 2002 and the first change in her Tax Credit had been in April 2002. The letter dated 28th March 2002 stated that there was an increase in Working Families Tax Credit and she probably received it some time in April 2002. The letter informing her of the increase represented a change in her circumstances which she had notified to the Council. She could not state the date she did this. The letter from Miss Hughes confirmed an award of Housing Benefit and cheques were sent direct to the landlord. She did not receive cheques herself. She said that she was not confused in that she did take the application form but did not go to ask for a Housing Benefit claim form as it was always posted to her. She sent it back by going personally to Saxon Court. All changes are notified when the claim form was received. She went there on the day she took her Housing Benefit form and she asked for a change in circumstances form. The only office she went to was Saxon Court. She did go in between but could not remember the month. It could have been November 2001 and December 2002. She had notified the Council all the time of all of her changes of circumstances. She did not want to go to the Council office without a Solicitor and in September 2003 she did not get round to it. Her Housing Benefit was renewed at the end of each year and at no other time and she had been in to the Council to make notification. She still receives Working Families Tax Credit but does not claim Housing Benefit now.

    (c) We read a statement under Section 9 of the Criminal Justice Act 1967 to Mrs J WILLIAMS, a Supervisor at Milton Keynes Citizens' Advice Bureau. At the date of the statement - 5th April 2004 - nine clients had complained about Milton Keynes Council losing correspondence. These generally related to applications going astray.

  64. We heard the following submissions as to verdict. It is contended for the Appellant that she did promptly notify the Respondent of the increase in her Working Families Tax Credit and this was done by her visiting the Respondent's office, completing a change of circumstances form and providing relevant documentation in support.
  65. We found that the Appellant had not notified the Respondent promptly of the changes in her entitlement to Working Families Tax Credit, either in April 2002 or in October 2002. We were of the opinion that the evidence of Gill LONG and Olive KING confirmed that there was no record that the Appellant had lodged any evidence of a change in circumstances with the Respondent promptly on either occasion. We accepted the evidence of David PRYKE that, in relation to the allegation of April 2002, he had checked the file 10 to 12 times for any missed correspondence from the Appellant notifying a change in her circumstances, but had found none. Moreover, we found that the Appellant was vague about whether she had handed in the evidence confirming the increase in Working Families Tax Credit in April 2002 and was unable to state when she had done so. The Appellant admitted that the notification of the increase in Working Families Tax Credit received from October 2002 was not notified to the Respondent until 3rd December 2002. In the light of all the evidence we were satisfied beyond reasonable doubt that the Appellant had failed to notify the Respondent promptly of a change in her circumstances with a view to obtaining Housing Benefit on or about 2nd April 2002 and on or about 1st October 2002. Accordingly, we found her guilty of both offences.
  66. We were referred to the following statutory provisions:
  67. Section 112(1A) Social Security Administration Act 1992

    Section 116 (3)(b) Social Security Administration Act 1992

    Section 9 Tax Credits Act 1999

    Paragraph 13, Schedule 2, Tax Credits Act 1999

    QUESTIONS

    The questions for the opinion of the High Court are:

    (a) Whether we were correct in finding that Paragraph 13 of Schedule 2 to the Family Tax Credits Act 1999 did not prevent a prosecution relating to the obtaining of Housing Benefit or Council Tax Benefit under Section 112(1A)Social Security Administration Act 1992.

    (b) Whether we were correct in finding that the informations laid on 20th November 2003 had been laid within the time limit specified on Section 116(2)(b) of the Social Security Administration Act 1992.

    (c) Whether there was evidence on which we could convict the Appellant of the two offences contrary to Section 112(1A) of the Social Security Administration Act 1992.

    Justices' Clerk for Buckinghamshire

    Signed on behalf of the adjudicating Justices and by their direction

    Dated this 26th day of July 2004


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