Green v Secretary of State for the Department for Work & Pensions

The claimant, Robert Steven Green, began judicial review proceedings on 27 April 2007. His grievance relates to his child support liability in relation to his son, Thomas. The claim form focussed on the decision of the defendant, the Child Support Agency (CSA), on 30 January 2007, to issue a Notice of Intention to apply for a Liability Order in relation to arrears of child support which they asserted the claimant owed and which he denied although, as is so often the case with judicial review claims, the target has moved somewhat over time.

The background to the decision of 30 January 2007 was a long debate between the CSA and the claimant, dating back to 2001, over whether sums that he had paid by way of school fees for his son should or should not be offset against his child support liability. The claimant has consistently contended that they should be and has asserted that there was an agreement between himself and Thomas’s mother, Mrs Green, that the payments were made in lieu of child maintenance. The CSA declined to make any allowance for the money paid to the school. As for Mrs Green, when asked by the CSA during the child support assessment process whether she was prepared to agree to the school fees payments being offset against child support, she said she was not. It has become clear in these proceedings that she denies there was any agreement between herself and the claimant that the payments were in lieu of child maintenance.

The progress of the judicial review claim has been more than usually chequered. Mr Justice Beatson ordered that it should be listed for an oral permission hearing. That hearing took place on 19 March 2008. Five grounds for judicial review were advanced. Mr Justice Cranston only granted permission for one of them to proceed. That was ground 4 which was that the CSA failed to notify the claimant of the mother’s refusal to accept the payment of school fees against his CSA liability. The judge refused the claimant permission to argue ground 1 (that the CSA had failed to exercise their discretion in relation to whether the school fee payment should be offset), ground 2 (that the CSA had based their decision not to offset the payment on a biased view), ground 3 (that there was an agreement between the claimant and Thomas’s mother that Thomas would be privately educated and the claimant would be responsible for paying the school fees and associated costs) and ground 5 (that the claimant had been denied a fair hearing by the CSA in that they had not disclosed the mother’s objections to him and had failed to give him an adequate opportunity to defend his position). Alongside other directions, Cranston J gave directions for the CSA to disclose to the claimant documentation relevant to the issue in the proceedings. He expressly left open for argument at the substantive hearing the issues of delay and alternative remedy which had been raised by the defendant.

On 2 June 2009, the claimant issued an application for leave to rely on grounds 1, 3 and 5, notwithstanding Cranston J’s refusal to permit this. By the time this application for expanded permission came before me for determination on 20 October 2009, the claimant only sought to pursue grounds 1 and 5 (failure to exercise any discretion and procedural unfairness). His application had to be seen in the light of the documentation that had been forthcoming pursuant to Cranston J’s directions and the change in the defendant’s position after the oral permission hearing. Before Cranston J, the defendant had argued that the claimant had alternative remedies which rendered judicial review inappropriate. These were said to be either a challenge within the liability order proceedings in the magistrates’ court or an appeal under the Child Support Act 1991. These arguments were subsequently abandoned by the defendant. The defendant had also resisted permission, at the oral permission hearing, on the basis that the CSA had no discretion to offset the school fees payments against the claimant’s child support bill. However, after the hearing, it became clear that there was a discretion to offset voluntary payments of this type. Margaret Vasey, the “Debt and Enforcement Policy and Litigation Manager for the Child Support Agency”, in her statement of 12 May 2009, identifies this case as an “old scheme” child support case, that is a case which proceeds under the Child Support Act 1991 as it was before amendment by the Child Support, Pensions and Social Security Act 2000), and she says,

“14.

For ‘old scheme’ cases the Secretary of State has a non-statutory discretion to accept certain payments made by the NRP (otherwise known as the absent parent (AP)) as voluntary payments to be set against the amount assessed as child maintenance (CM). These are known as “Voluntary Payments” (VPs), being payments made by the NRP which are not payments of CM but which are later accepted as being set against the NRP’s liability under an assessment (and see below).

15.

In old scheme cases VPs are therefore not governed by the 1991 Act or regulations, but the decision maker dealing with the case can exercise discretion on behalf of the Secretary of State (now the Commissioner) and offset payments in certain circumstances. A copy of the Agency’s policy and procedures relating to Voluntary Payments as it was at the material time is in Volume 7 of the Child Support Guide (August 2002)….”

(“NRP” stands for non-resident parent).

I granted permission for the judicial review claim to be expanded to include argument on grounds 1 and 5 for reasons which I explained at the time and which will also be plain from this judgment.

It was not possible to proceed to determine the judicial review claim on 20 October 2009. This was not because of the expansion of the grounds. It was because Mrs Green had not been given any notice of the claim and she stood to lose financially if the claimant succeeded in it. She should have been joined as an interested party and I directed that the claimant serve her with the pleadings and evidence. Her acknowledgment of service is dated 18 November 2009. It indicates that she intends to contest part of the claim for reasons she sets out.

However, when the matter came back before me for hearing on 17 February 2010, Mrs Green was not in attendance. It seems that this was because she had not been given notice of the hearing date by the court. She was contacted by telephone and indicated that she wanted an adjournment so that she could attend. There seemed to me to be no alternative but to grant that.

It was on 3 March 2010 that the matter came back before me, for a third time, finally in a position to proceed.

Mrs Green attended in person on 3 March and addressed me at the start of the hearing. She invited me to uphold the way in which the CSA had treated the school fees payment in relation to the claimant’s child support liability. Her case is that there was no agreement that the £6,000 paid for school fees was in lieu of maintenance. The payment took place during the period when the parties were sorting out ancillary relief arrangements following their separation. The claimant’s solicitors were holding joint monies. Mrs Green wanted the school fees to be paid prior to the balance of the joint monies being released to the claimant as part of a compromise in which she took over the former matrimonial home and he had cash instead.

Mrs Green did not wish to stay for the whole hearing and I did not consider it necessary that she do so given that she had made me fully aware of what she said about the status of the school fees payment and her legal arguments were likely to be essentially in line with those of the defendant.

As the judicial review claim form reveals, the catalyst for these judicial review proceedings was the service on the claimant, in January 2007, of a Notice of Intention to Apply for a Liability Order. The Notice indicates that the “liable period” is from 12 June 2001 to 3 September 2006 and the total said to be due by way of arrears of child maintenance for that period is £10,203.14. The Notice says that if the claimant does not pay within 7 days of the date of the letter, the CSA will apply to court for a liability order from the magistrates’ court.

The Notice of Intention to Apply for a Liability Order was not, however, the beginning of the story. To determine the issues in the case, it is necessary to go back considerably further.

The claimant and Mrs Green married in 1979 and Thomas was born in 1988. His parents agreed that he would be educated privately and made provision for the fees by taking out a policy. In due course, Thomas went to a local private school where he stayed for the rest of his schooling. In 1998, the school fees policy matured, producing £20,000. This was not sufficient to cover the whole of the school fees. The parents put it on deposit with the school for his upper school fees, intending to pay the fees to the age of 13 from other funds.

By 1998, the marriage between the claimant and Mrs Green was breaking down and they separated during 1999, with Thomas remaining based with Mrs Green. The claimant issued a divorce petition in September 1999 and discussions began between solicitors in relation to contact and ancillary relief. It is the claimant’s case in these judicial review proceedings that, in due course, an agreement was reached between himself and Mrs Green that he would meet the school fees in lieu of maintenance.

The contemporaneous documentation in relation to the ancillary relief proceedings and in relation to all the dealings between the CSA and Mr and Mrs Green was produced to the court in a complete jumble. Counsel did their best to assist by referring me to the correct pages in the correct sequence but, in order to understand the situation properly, I eventually took apart the bundle and put the material into chronological order. This was particularly important when attempting to establish what material the CSA had before them when making decisions. I have drawn on it to compile the account which follows.

The CSA’s involvement began when Mrs Green filed a child support application with them dated 30 March 2001. Negotiations in the ancillary relief proceedings were still going on at this point and it was only on 3 January 2002 that an ancillary relief order was eventually made. In the application form, Mrs Green indicated that there was no “existing arrangement with the non-resident parent to pay you maintenance for the children” but, in the section for further information, she said,

“Mr Green agreed to pay the school fees. Since August 99 he has paid for only 3 terms, I think. I received no help with clothes, present or living expenses for Thomas. ”

I took this to be a complaint by Mrs Green about Mr Green’s failure to make the payments Mrs Green thought he should be paying, a sort of justification for her making her child support application, rather than indicating that she thought that the payments Mr Green had made might count in his favour in calculating his child support liability or even be relevant to that calculation.

The claimant provided the CSA with a completed form setting out his details and also forwarded to them “important additional information” including a page from his ancillary relief Form E (probably the page dealing with future income needs, including a figure for future school fees), offering to supply more information if they required it. On the CSA form, he indicated that he did not have “any other arrangement to pay maintenance for all or some of the children”.

Around 12 September 2001, the CSA notified the claimant that they had made an interim maintenance assessment of £20 per week, pending him providing them with all the information they needed for them to make a full assessment. They notified him that the money should be paid to them by Transcash weekly.

The CSA interviewed the claimant on 5 October 2001 after he had requested an explanation of the assessment. The claimant told them that he had Thomas 2 nights a week and paid his school fees of £270 per term. The report of the interview says,

“I advised him that we would look into the shared care aspect when a formal maintenance assessment was calculated, and that the way school fees are treated is under review at the moment.”

On 19 April 2002, the claimant’s divorce solicitors sent a cheque for £6,000 to Thomas’s school. This was the largest single payment made by or through him to the school, but the claimant also made other education related payments.

Around 4 October 2002, the CSA notified the claimant that they now had all the information needed to assess his child maintenance and that the sum due, from 12 September 2001, was £74.70 per week.

On 10 October 2002, the claimant wrote to the CSA to say that he wanted to appeal the assessment. He said that his circumstances had changed since they received all they information they had asked for from him. Amongst other things, he said that his business had ceased trading and he was looking for employment. He also made them aware that Thomas was being educated privately and that “[t]o keep him in full time education till he is sixteen, I have personally paid the school six thousand pounds”. He also said that he paid a great deal for sporting equipment for his son and provided transport to sporting venues for him.

On 16 October 2002, the CSA wrote to the claimant to tell him that his child maintenance had gone up to £323.70 per month. The letter is contradictory and very difficult to understand but appears to be indicating that arrears of maintenance of £4,318.48 have therefore become due.

Mr Green wrote to the CSA in November 2002 expressing his dissatisfaction about the situation. In that communication, and at various points throughout his dealings with the CSA, he referred to his expenditure on Thomas, including his payments of school fees and expenses. He invited the CSA’s attention to the fact that that expenditure “far exceeds the amount which you purport that I owe the CSA therefore I wish to make a counter claim against the CSA and/or Mrs Green for the balance.”

An internal CSA note dated 12 December 2002 records a conversation in which Mrs Green told them that the claimant was requesting her to change the amount of his child support. There is a further note, dated 24 December 2002, of a conversation with the claimant which says,

“NRP states has paid QC’s school fees £6,000 advised unless PWC agrees to this being w/o arrears o/s we cannot allow them but could look at this being sent [I think that is the word – it has been punched through in my copy] to dep to see if this could be allowed when his assessment is calculated.”

(“PWC” stands for parent with care and “QC” for qualifying child.) Ms Vasey translates this note in her statement as saying “Advised unless PWC agrees to this being correct and removed from arrears outstanding we cannot allow them”.

A notice to the claimant appears to have been generated on 24 December 2002, soon after the telephone conversation with him, which says that the CSA have looked at his case again and decided that the information provided did not affect his child maintenance; it was sent out to him on 30 December 2002.

At around this time, the CSA sent a form to Mrs Green requesting more information from her. They asked her to answer a question which was recorded on the form in this way,

“Mr Robert Green has told us he has paid £6,000 for school fees. Please advise us if you are willing to offset this sum against your arrears.”

Mrs Green responded, on 14 January 2003, with one word, “No”, underlined.

On 27 January 2003, the claimant wrote a letter addressed to “The Appeals Board” expressed to be with reference to the “CSA letter of the 30th December 2002 relating to my appeal which was refused”. Presumably that letter is the one to which I have already referred. In his long letter, the claimant set out his sense of unfairness. The letter includes a passage specifically about school fees and other payments for Thomas and expressly mentions the March 2002 payment of £6,000. Having referred to these payments, it says,

“Mrs Green refuses to accept this payment to be set aside the sum which I reputedly owe the CSA. For the amounts of money I spend on my son during a year she refuses to accept any of these costs. It is not a case of do I spend money on my son, I HAVE to cover these costs.

She refuses to in any way to transport him to my home or pick him and refuses to cover ANY costs. If I ask her for anything for my son she refuses.” [sic]

That same day, the claimant also launched an appeal against the 30 December 2002 decision.

On 28 January 2003, the CSA notified the claimant that his child support payment had been reduced to nil, backdated to 1 October 2002. On 12 February 2003 Mrs Green appealed against this.

There is a series of records dating from 24 June 2003. There is a record, on a form entitled “Record of adjudication decisions” (which seems to be known as Form CSA 550), which appears to relate to the claimant’s appeal against the 30 December 2002 decision. It is difficult to know what to make of it without the Form CSA 555 referred to in it. There is another record on a similar form dealing with Mrs Green’s appeal. It seems that the writer may have concluded that the figures were correct, notwithstanding an immaterial error. There is a record of a telephone call with Mrs Green that day in which she was informed of this and agreed to withdraw her appeal rather than taking it further.

The claimant’s appeal against the 30 December 2002 decision is the subject of a further internal record on another Form CSA 550, this time dated 17 September 2003. This record is particularly difficult for someone from outside the CSA to understand. It appears to amount to a rejection of most of the points upon which the claimant sought to rely. Amongst them was the issue of payments for things such as school fees. The record says, in this regard, “There is no provision within the fixed formula to reduce the amount of maintenance payable on account of voluntary payments such as school fees, sports equipment, training etc.”. However, an error in the treatment of income tax led to a revision of the weekly sum due. According to a further record, this was explained to the claimant in a telephone call on 19 September 2003. The note of that conversation says,

“….I explained that payment of school fees etc are voluntary payments that can be offset against arrears if PWC agrees. However, he would need to provide evidence to the CSAC. The question of arrears is outside jurisdiction of the tribunal. I explained that he can apply for a departure on the grounds of child contact costs but only travel costs could be considered.” [my italics]

On 30 October 2003, the claimant declared himself bankrupt. He informed the CSA of this.

On 12 March 2004, the claimant wrote to the CSA asking them to update him regarding Thomas who had turned 16 on 23 February 2004. I have seen no reply to this.

It appears that in September 2004, the CSA must have written demanding payment from the claimant of £4,934.91 within a matter of days. I get that from a letter the claimant wrote to the CSA on 27 September 2004. After that, there is a gap in the documentation until August 2005. There is an internal record on 26 August 2005 of a conversation between the CSA and the claimant in which there is a return, yet again, to the subject of school fees. This appears to contemplate the matter being pursued by the claimant by way of an application for a departure. However, the writer records that he advised the claimant that if the information they need is not supplied, enforcement action would be taken.

The claimant submitted a form dated 17 November 2005 applying for a departure direction. The section entitled “Other information” contains the following invitation,

“Please tell us if you think there is anything about your circumstances (including those of your child(ren)), income or expenses which you think we should take into account when making our decision.”

In reply, the claimant has put “Please read attached letters”. I am not able to find these letters in my bundle.

The CSA response is contained in a “Departure Decision” dated 20 December 2005. The decision maker at the CSA Departures Office refused to give a departure from the maintenance formula. Elements of the decision are explained but there is nothing about the school fees issue.

On or about 24 January 2006, the CSA served notice on the claimant of their intention to apply for a liability order covering the “liable period” from 12 June 2001 until 26 November 2005. The current total amount due for the period is given on the notice as £8194.71.

On 23 February 2006, the CSA wrote to the claimant in response to a request from him for a statement of his child maintenance account. No mention is made in that communication of school fees or allied payments. The “help notes” invite the recipient to advise the CSA if he or she has made payments direct that are not shown in the statement.

On 3 March 2006, Hatton Solicitors made their first appearance, having just been instructed by the claimant to deal with the school fee issue, in the form of a letter to the CSA. They continued to be involved from this point on and still represent the claimant in relation to his child support liability. Meanwhile, the application by the CSA for a liability order was proceeding towards the magistrates’ court.

On 4 May 2006, there was a conversation between the CSA and the claimant’s solicitors in which the solicitors indicated the bases on which they would be appealing in relation to the arrears of child support and were advised by the CSA official “that school fees do not make up maintenance unless PWC agrees”. That conversation was followed up by a letter from the solicitors to the CSA in which they spelled out that “it is our case that our client, in paying substantial school fees for Thomas, did so with the knowledge, approval and agreement of Mrs Green”. The reply from the CSA on 11 May 2006 was to this effect,

“I can also confirm that the issue of Mr Green having paid School Fees for Thomas is not something that is considered as, or can be offset against, Child Support. This private agreement is something that is above and beyond what the Child Support Agency considers to be maintenance, and as such will have no bearing on the amount of Maintenance that is owed by Mr Green. I can also confirm that Mr Green has applied for this to be departed against the assessment, but that this application was unsuccessful.” [sic] ”

The claimant’s solicitors offered to provide evidence in relation to the school fees situation in the form of a witness statement from their client and said, in a letter of 11 May 2006,

“Mr Green paid an additional sum of £6,000 over and above that ordered by the Worcester County Court in his divorce from Mrs Green to her, albeit she directed that sum of money should be paid to Thomas’s school [named]. This, of course, corroborates the point ….that the payment of these school fees was agreed and that they are to be counted as payments for CSA purposes.”

Correspondence continued. On 26 May 2006, the CSA dealt again with the school fees,

“….I …reiterate that this is not treated as Child Maintenance under any circumstance, unless we are instructed by the Parent With Care that they accept these payments as being voluntary in lieu of Maintenance, and are to be offset against any arrears owed. I can confirm that this question has already been asked of the Customer in question, and that we will not be treating any school fees as Maintenance in this case.”

On 28 July 2006, Hatton Solicitors set out at some length the chronology of the agreement that the claimant asserted there was between himself and Mrs Green that he would be responsible for the school fees. They enclose “further written evidence” of the agreement in the form of a copy of a handwritten letter from Mrs Green received by the claimant’s ancillary relief solicitors on 3 April 2002 which they say is a clear indication that Mrs Green wanted Thomas to be privately educated and expected the claimant to pay for that. They refer to a mini motor car which was said to be Thomas’s and say,

“Mrs Green obtained an order [in the ancillary relief proceedings] that the car be sold and the sale proceeds of £6,000 be paid to Bromsgrove School to secure Tom’s education. Our client, to avoid a sale which he felt would massively upset his son, increased the divorce settlement to his wife by that amount (£6,000) to avoid the necessity of a sale.”

The letter concludes with an invitation to agree to an adjournment of the magistrates’ court liability proceedings so that a proper reassessment of the situation could be carried out and in particular, the school fees position “properly and transparently considered”.

On 12 September 2006 the CSA wrote to the claimant’s solicitors indicating that “[i]n view of the outstanding issues still unresolved” they had decided to withdraw their magistrates’ court application. On 4 October 2006, they wrote to the claimant indicating that they had looked at his case again and decided that the information he had provided did not affect his child maintenance.

The claimant continued to pursue the issue of the school fees payment. In a letter of 2 January 2007, the CSA maintained their previous stance that the school fees could not be taken into account as child maintenance. They were not prepared to disclose the written refusal from Mrs Green to accept the school fees in lieu of maintenance (they apparently saw this as a data protection issue) but relied on it. The letter says,

“Documentary evidence from Mrs Green clearly states that she will not accept items/school fees in lieu of maintenance and unless Mr Green has documentary evidence to the contrary there is nothing more that can be done. ”

The claimant’s solicitors continued to battle against this approach. Amongst the arguments articulated at this stage was the contention, in a letter of 5 January 2007, that whether payment of school fees is to be treated as a payment in lieu of maintenance is something to be determined objectively on the facts, and not on the “fiat” of Mrs Green.

And so we come to the Notice of Intention to apply for a Liability Order, dated 30 January 2007, the arrears by that point standing at £10,20.14.

The claimant involved his MP. The CSA’s response on 22 February 2007 to a letter from him was that there

“is no liability under child support legislation for a non-resident parent to meet school fees”

and that

“The Agency holds documentary evidence from Mrs Green that clearly states that she will not accept items/school fees in lieu of maintenance and unless Mr Green has documentary evidence to the contrary there is nothing more that can be done.”

On 26 March 2007, the CSA offered an apology to the claimant’s solicitor for

“our failure to inform Mr Green about the parent with care’s refusal to accept the payment of £6000 for school fees in respect of child support maintenance”

They attributed this to “a breakdown in communication”.

Meanwhile, they began to prepare for impending judicial review proceedings by the claimant by approaching Mrs Green again about offsetting the school fees. She provided more detail to the defendant, as recorded in a note dated 11 April 2007 of a telephone call with her, including the following:

“During the divorce the couple’s bank accounts were frozen and PWC agreed for them to be unfrozen if NRP paid the school fees. He paid the money directly to the school and no agreement was made that they were accepted in lieu of child maintenance. I told her NRP’s solicitor stated a further £4000 in school fees were paid in 2004. She said she knew nothing about this at all. I told her that NRP solicitor was saying that NRP did not owe any child support as he had already paid the £10,000 in school fees. She again confirmed she still did not accept them as Child Maintenance and wanted the full amount of arrears recovered.”

In May 2007, the claimant’s solicitor provided documentation to the defendant on the subject of the school fees which they said established an agreement between the claimant and Mrs Green that Thomas should be privately educated and that the claimant would pay the school fees in lieu of maintenance. In their letter of 31 May 2007, they complain that none of the material had apparently been considered by the CSA or, if considered, it had been rejected out of hand with the CSA “partisanly approving Mrs Green’s evidence”. They requested a reconsideration of the position in the light of the evidence supplied.

Also in May 2007, the magistrates agreed to adjourn the liability order proceedings against the claimant pending the decision in these judicial review proceedings.

Meanwhile, of course, the pleadings in the judicial review claim were beginning to accumulate, including, the claim form on 27 April 2007 with grounds, the summary grounds of defence dated 24 May 2007 and the claimant’s reply dated 8 June 2007 to the summary grounds of defence. Later, as the permission hearing approached, a considerable number of skeleton arguments began to mount up: for the permission hearing in March 2008, for a hearing in June 2009, for the hearing in October 2009, for the hearing in January 2010 (skeleton argument for the claimant and detailed grounds of defence for the defendant), and then a further skeleton from the claimant dated February 2010 and the defendant dated March 2010. Witness statements were also assembled. If ever a case demonstrates how a profusion of pleadings and written arguments can serve to obfuscate rather than clarify the issues, this is it. Having said that, Mr Jerman for the claimant helpfully provided some operating instructions with his skeleton of 15 February 2010, which directed me to that skeleton and the claimant’s initial skeleton of 30 January 2009 as the relevant ones for his side, and Miss Patry Hoskins assisted by identifying the relevant documents on her side as her skeleton of 2 March 2010, the defendant’s detailed grounds of defence, and the witness statement of Ms Vasey.

A number of matters seem to be common ground:

The Guidance makes clear in a number of places that decisions about the treatment of voluntary payments are discretionary. It also says that they must be based on the circumstances of the individual case and that the welfare of the child must be considered at all times. Ms Vasey underlines this in her statement, pointing out, in addition, that the guidance is only guidance.

The Guidance contains various directions about keeping a record of decisions about voluntary payments. Specific forms are required at times by the Guidance but the general provision, contained in the section entitled “Making a decision” is that:

The Guidance also assists in the determination of which payments can be accepted as relevant in relation to child support. The approach to payments made during the Initial Pay Period is more generous to the payer than the approach during the Regular Maintenance Period; it is the latter approach which is relevant here.

I intend to set out here the remaining paragraphs of the Guidance which appear to me to touch on the issues in this case, or at least those parts of those paragraphs which are material. Mrs Green is “a PWC not in receipt of a prescribed benefit”, also referred to as “a private client”, not a PWC in receipt of benefit, so I have omitted guidance which relates to a PWC on benefit.

The first relevant paragraphs are 127 and 128:

“127.

When deciding on what voluntary payments to accept, you can accept any payment:

•

proven to be made to the PWC for child maintenance or as an acceptable third party payment

•

a PWC not in receipt of a prescribed benefit confirms as received or accepts in lieu of child maintenance……..

128.

The deciding officer should also be aware that if the PWC is a private client, the PWC can decide to accept any payment made by the NRP in lieu of child maintenance during the IPP or regular maintenance period. This amount can be offset against the arrears outstanding for the same period as the payment was made…”

At paragraph 140, a section entitled “Identifying voluntary payments” begins. The relevant portion of paragraph 140 says:

“140.

Please note that voluntary payments made:

•

[deals with payments during the Initial Payment Period, so omitted]

•

after the IPP end date will be allowed if they were cash payments less than or equal to the amount of the weekly MA or a private PWC accepts the payments in lieu of child maintenance”

Two examples follow after paragraph 140.

At paragraph 170, there is a section entitled “Voluntary payments in the regular maintenance period”.

Paragraph 170 highlights the difference between the IPP and the RMP and says that in the RMP, third party payments “would not normally be considered”. Relevant from the following paragraphs are these:

“171.

During the regular maintenance period consider whether the NRP is required to continue making a voluntary payment or if a voluntary decision has been made to continue making payment over and above the regular maintenance assessment. Once the NRP has received form CSA 55N …. the NRP is now aware of the Child Maintenance Liability and any decision to continue paying child maintenance payments over and above this amount would be voluntary. In these circumstances, payment can be considered as a gift and not accepted as a voluntary payment. This is essential if the acceptance of an increased payment would lead to an overpayment. All decisions made in these circumstances should be recorded on form CSA555 or CSA550.

172.

…........

173.

You would normally consider payments made in the RM period made directly to the PWC by cash/cheque provided they were confirmed as made for or in lieu of child maintenance. These can be offset against any amount outstanding, provided the NRP/PWC confirm the amount paid and received.

174.

…….

175.

The third party payments outlined as acceptable in the IPP would not normally be considered in the RM period unless the PWC is:

•

a private client and requests the amount offset in lieu of child maintenance

•

….[PWC on benefit]

176.

If the PWC does not confirm the amount was received in lieu of child maintenance you would not normally offset the payment against amounts outstanding. Encourage the PWC to give a detailed explanation as to why the payment will not be accepted in lieu of child maintenance to assist.

177.

If the NRP has provided evidence and you feel on the balance of probabilities the amount has been paid for child maintenance, a decision can be made to accept the amount…..”

Paragraphs 190 to 201 deal with the steps that the CSA officer should take to confirm the payment that is being considered as a possible voluntary payment. They require both the PWC and the NRP to be contacted by telephone but, if information cannot be obtained that way, a written confirmation and/or supporting evidence should be obtained from them by sending the relevant form. Paragraph 201 says:

“201.

When the NRP and/or PWC returns the relevant form, consider if sufficient evidence is available to allow you to make a discretionary decision on behalf of the SofS.”

A section entitled “Conflicting evidence” begins at paragraph 210. Paragraph 210 identifies that the problem contemplated is that the PWC does not confirm the NRP’s payments. Paragraph 211 provides that in these circumstances:

“211.

If the NRP has provided clear evidence, you may decide in favour of the NRP. If the NRP can prove payment, the burden of proof then moves to the PWC to prove with evidence that they have not received the payment.”

Four examples are included in this section. Example 4 concerns school fees. It postulates that the NRP provides receipts of payment in respect of the child’s fees but “the PWC does not accept them as child support maintenance”. The guidance given on these facts is,

“You would normally decide in favour of the PWC, as school fees are not normally interpreted as day to day maintenance. If the PWC had accepted these payments in lieu of child maintenance, then the amount could have been offset against the outstanding arrears. ”

Paragraph 214 says:

“214.

You can also make the decision to accept voluntary payments where the NRP is unable to provide evidence but the PWC will not respond to requests for confirmation. The PWC should be made aware that if they do not confirm or deny receipt of the payments, a decision could be made on the balance of probabilities to accept them.”

Beginning at paragraph 230, there is a section entitled “Making a decision” with a subsection “Payments not to be taken into account”. Paragraph 230 says:

“230.

Notify the NRP and PWC if it is decided not to take the voluntary payments into account because the:

•

NRP has not proven, on the balance of probability that the payments were made”

•

NRP has not proven that the payments were for day to day maintenance of the qualifying child(ren)

•

…… [not relevant here]”

Paragraph 231 provides that the decision should be notified to the parents by telephone or by sending stipulated forms to them.

There is a section dealing with the receipt of new evidence, which commences at paragraph 320. It makes clear that the new evidence must be considered, regardless of how long after the original decision date it is received.

Ms Vasey seeks to throw some light on the philosophy and the practicalities of the approach in the Guidance.

She explains that the “discretionary extra-statutory scheme” for voluntary payments is particularly restrictive in the RMP in order to avoid the PWC being saddled with payments in a form they do not want which are contended by the other parent to be in lieu of child maintenance, and to avoid the NRP claiming that random payments made directly to the qualifying child or to the PWC were intended and agreed to be made in lieu of child maintenance when they were not. She says that this is a necessary approach, given that Parliament has not provided for voluntary payments.

She also calls attention to the different treatment of cash payments made to the PWC and payments made to a third party. In essence, it is easier to persuade the CSA to treat the cash as a payment in lieu of child maintenance than the third party payment, the reason for this being that the PWC has a certain amount of control over how to spend a payment made to them, whereas they have no control over a payment made to a third party.

Further, she speaks of a policy, introduced in early 2002, known as “Positive Client Contact”. This encouraged case officers and decision makers to use the telephone to clear queries and gather information more quickly without the need for written communication. She says that contact with either parent about voluntary payments should also be by telephone and draws attention to paragraph 190 which says this is the way for an officer to seek confirmation that a payment which might class as a voluntary payment has been made.

Ms Vasey’s understanding of the approach required by the Guidance to a payment such as the claimant’s school fees payments appears in paragraph 66 of her statement where she says that the approach set out in the Guidance is “that normally school fees paid in the RMP would not be accepted unless the PWC requested them to be accepted as child maintenance”. She returns to this in paragraph 80 in similar terms, saying that the Guidance makes it quite clear that school fees are not taken into account in normal circumstances unless the PWC agrees to this.

Ms Vasey accepts (paragraph 69) that there is no record of confirmation being sent to the claimant that the school fees payments were not being accepted as voluntary payments and “that there is no formal decision recorded to this effect within the Agency’s records”. She is talking here about the period in early January 2003 which followed Mrs Green’s one word refusal to accept the fees being offset against the arrears. She also says, in paragraph 73,

“The agency accepts the specific decision that the £6000 school fees paid by the NRP to [the school] cannot be accepted as Voluntary Payments has not been documented as required by [the Guidance] and the NRP was not notified in writing at the time it was made. ”

Ms Vasey seeks to escape any consequence of this accepted failure by an assertion that the CSA’s decision making process is evident from the documentation and that the claimant appears to have been notified by telephone that the school fees could not be accepted because he refers, in his letter of 27 January 2003, to Mrs Green’s refusal to accept the £6,000 being set against his arrears.

Ms Vasey says that “[t]hus the CSA’s position is that Mr Green was aware from 27^th January 2003 onwards what its decision was in respect of whether school fees could be taken into account in his case as voluntary payments. He was then told again on 19^th September 2003 by telephone”. In so saying, she seeks to introduce a degree of clarity to what the claimant was told in that telephone call which is absent from the internal note of the conversation, suggesting that it is established that the claimant was told that day that, as she summarises it in her statement (in paragraph 76), “school fees in the RMP are VPs not normally taken into account unless the PWC agrees or, say, unless clear contrary evidence is shown that the payments were made in lieu of child maintenance”. She says that no such “contrary evidence” was received following the 19 September telephone call, so no further action was taken.

In paragraph 88 of her statement she says,

“The NRP has now provided evidence which purports to demonstrate an agreement between the NRP and the PWC that the NRP would pay school fees. However, this was not provided at the time of the original decision in 2003 and thus cannot now be relied upon to impugn that decision.”

She goes on to remark that the evidence provided included the consent order in the ancillary relief proceedings which provided that Thomas’s Mini Cooper was to be sold and the proceeds used for his education and that the covering letter from the claimant’s solicitors (their letter of 22 May 2007) explained that the claimant agreed to pay the £6,000 to the school to avoid the car being sold. Thus, she says, “the £6,000 was paid to resolve a private matter between the two parties” and the evidence does not demonstrate that it was intended to be paid and was paid in lieu of child maintenance or show that Mrs Green agreed that the sum was paid in lieu of child maintenance. In the circumstances, she remains of the view that the CSA correctly refused to accept the payment of school fees as a voluntary payment which should be set off against arrears.

A number of features are clear from the material before me.

I will deal first with what I consider to be important features of the Guidance, although I will not extend this judgment by going back over the detail which underlies the points I make, which can be found in the passages set out earlier on. The Guidance is not expressed as clearly as it might be and at times is confusing and potentially contradictory. One has to bear in mind that it is only guidance and that it cannot be construed as a statute.

What is abundantly clear from the terms of the Guidance, and is conceded, is that there was a discretion to be exercised by the CSA in determining whether to permit the school fees payment to be offset against child support.

It is also laid down expressly that the discretionary decision must be based on the circumstances of the individual case, with consideration being given to the welfare of the child at all times However, it is plain that in exercising that discretion, the CSA is to give weight to the current view of the parent with care. If a parent with care who is not on benefits is willing to agree to the proposed offset, then it will be permitted. But, if the parent with care does not agree to it, there nevertheless remains a discretion to be exercised because the Guidance does not make everything dependent on the current wish of the parent with care but enjoins the decision maker to take into account all the circumstances of the case. I think one can divine from the Guidance (albeit only after some detective work) that to exercise the discretion where the parent with care is not in agreement with the proposed offset, the decision maker has to explore the circumstances at the time the payment in question was made, including an investigation as to whether the parent with care agreed at that time to accept the payment in lieu of child maintenance. Ms Vasey seems to accept that this is so; I think this must flow from what she says in paragraph 76 of her statement about the school fees not normally being taken into account unless “the parent with care agrees or, say, unless clear contrary evidence is shown that the payments were made in lieu of child maintenance”. In any event, it must be right as it would, of course, be impossible to consider all the circumstances of the case, as the Guidance requires, without taking a factor such as this into account. Certain passages in the Guidance do nod to the importance of a possible past agreement as well, although it is not clearly spelled out. An example is paragraph 176 which says that if the parent with care does not confirm that “the amount was received in lieu of child maintenance” (my italics), the sum would not normally be offset, rather than talking in terms of the parent with care not confirming that they are willing to accept the sum in lieu of child maintenance, although it is fair to say that that paragraph also tells the officer to encourage the parent with care to give a detailed explanation as to why the payment “will not be accepted in lieu of child maintenance”, thus once more confusing the ideas.

Another matter which the decision maker is bound to explore is whether the non-resident parent is “required to continue making a voluntary payment or if a voluntary decision has been made to continue making payment over and above the regular maintenance assessment” (paragraph 171 of the Guidance).

It is noteworthy that, as the passage in paragraph 176 to which I referred above shows, the decision maker is expected to seek information (there, a detailed explanation from the parent with care as to why the payment will not be accepted in lieu of child maintenance). It is not envisaged that the decision maker will sit back and wait for the parents to work out what might be relevant and provide it, nor could it be, given that the decision maker is the one with access to the Guidance, the one who knows the ambit of the discretion and the way in which it should be exercised and the sort of factors that are relevant, not the parents.

The Guidance uses terms that put one in mind of a court process and, to my mind, underline the responsibility of the CSA to ensure that they have the facts necessary to make a fair decision and then to approach that decision by evaluating those facts in a rational manner. There is mention of one or the other parent providing “evidence”. The decision maker has to consider whether there is “sufficient evidence” to make a decision (see paragraph 201) and the Guidance envisages the decision maker evaluating the evidence provided “on the balance of probabilities” (see, for example, paragraph 177 in relation to evidence provided by the non-resident parent of the amount having been paid for child maintenance).

I now want to isolate what I consider to be the important features of the factual circumstances of this case, in the light of what the Guidance required.

Turning to the grounds advanced in support of the claimant’s judicial review claim, it might have been thought that dealing with Ground 4 (failure by the CSA to notify the claimant of Mrs Green’s refusal to accept the payment of school fees against his liability) would be an entirely straightforward matter. After all, the CSA apologised for this failure in their letter of 26 March 2007 to the claimant’s solicitors. However, the Detailed Grounds of Defence say that it is “simply not right” for the claimant to claim he was not notified. It is conceded that there is no record of the claimant being told of Mrs Green’s position by the CSA, following Mrs Green’s one word reply in mid January 2003 to their enquiry but the defendant argues that it can be inferred from the claimant’s letter of 27 January 2003 that he had been told because he refers there to Mrs Green’s refusal to accept the payment being deducted from the arrears. This is certainly a feasible inference but not the only one. Mr and Mrs Green were in touch with each other in respect of Thomas as can be seen from the claimant’s comment in that same letter “If I ask her for anything for my son she refuses”. It is possible that the claimant acquired his information in this way. I have to say, however, that even if it were to be clearly established that the CSA had failed to inform him of Mrs Green’s position following her returning their questionnaire, I would not consider that failure, standing alone, to have been of the greatest significance in relation to their handling of his case. Whether through the CSA or otherwise, the claimant did know of her refusal to accept that the school fees were relevant and he would have learned nothing more by hearing it from the CSA or even seeing her one word answer on their form.

It is argued on the claimant’s behalf that if he had been informed of Mrs Green’s stance, he could quickly and simply have altered the payment arrangements so as to pay the money that would otherwise have been paid to the school to Mrs Green instead. A number of points can, however, be made about this. The “No” document came into existence on 14 January 2003; the £6,000 school fee payment had been made in April 2002. “Formal” notification of Mrs Green’s position in January 2003 would not have affected how the claimant dealt with that substantial payment, therefore. Furthermore, whether the information came to him via the CSA or not, the claimant undoubtedly did know of Mrs Green’s stance by the end of January 2003 so, if that was the information he needed in order to rearrange his affairs to his own better advantage, he was in a position from then to take the necessary steps. It was not, therefore, the failure of the CSA to notify him of Mrs Green’s response that caused him his difficulties.

In my judgment, one must look more comprehensively at the way in which the claimant’s case was handled before reaching any conclusions as to the lawfulness of the CSA’s decisions. I propose therefore to turn to Grounds 1 and 5, which interlock.

Ground 1 is the CSA’s alleged failure to exercise their discretion in relation to whether the fees should be offset. Ground 5 concerns the procedural unfairness that is said to flow from the CSA failing to disclose Mrs Green’s objections to him and to give him an adequate opportunity to defend his position. These grounds are established, in my judgment.

The exercise of the CSA’s discretion about the fees should, according to the Guidance, have been “fully documented” on Form CSA 550 with relevant evidence attached, and including details of why and how the decision was reached so that if the decision were later to be disputed or queried, it could be shown to have been considered on its merits. No such document exists. That makes it difficult to be sure of who made the decision and what their thought processes were. The documentation, which I have analysed in much more detail above, discloses a confusion on the part of the CSA as to the extent of their discretion and that confusion was transmitted to the claimant in their communications with him.

As I set out earlier, there is, in the documentation generated throughout the time when the claimant was dealing with the matter without solicitors, a sense that such discretion as there was to take into account a third party payment such as the school fees was considered by the decision makers to be wholly dependent on the current wishes of the parent with care. A very obvious example of this is the issue posed to Mrs Green on the form sent to her in January 2003, which was “Please advise us if you are willing to offset this sum against your arrears”, no enquiry at all being made about the circumstances at the time the payment was made, the conditions for the payment, any agreement between the parties about its impact on child support maintenance etc. I think it is fair to say that nowhere in the papers is there a clear recognition that there was a wider discretion and that it would certainly be relevant to the exercise of that discretion if there were to be evidence that the parent with care had agreed before or at the time of the payments in question that they were to be treated as payments in lieu of child maintenance and possibly relevant that the non-resident parent was obliged in some way to make the payments.

The confusion apparent from the documents is underlined by the stance taken by the CSA in front of Cranston J, that is that there was no discretion. I know that it is said that this stance resulted from an error on the part of the legal representatives but it is doubtful whether they would have made the error, had the facts or documents available to them clearly demonstrated that the CSA had been exercising a discretion.

In my judgment, the reality revealed in the papers is that, Mrs Green having declined to agree to the school fees being offset against child maintenance, the CSA treated the question as essentially closed and failed to exercise their residual discretion under the Guidance at all.

Miss Patry Hoskins submitted that this did not vitiate their decision to refuse to offset the school fees because they were not given sufficient information by the claimant to alert them to the need to consider the matter any further and, in particular, to alert them to any potential relevance of the school fees beyond the fact that they could be offset if Mrs Green was willing now to agree to that. She submitted that, in these circumstances, they cannot be criticised for failing to explore the issue more widely with the parties. The claimant undoubtedly told the CSA of the school fees payment at a very early stage and continued to revert to the subject regularly. What Miss Patry Hoskins rightly identifies is that he did not say anything about there being an agreement that the school fees were in lieu of maintenance and it is this failure which she says excuses the CSA from any duty to enquire into the subject. The difficulty with this argument, it seems to me, is that, the claimant could not have been expected to know what he had to establish to enable the CSA to exercise a discretion in his favour. The issue that had to be determined was not governed by statute or regulations but had to be approached by the CSA on a non-statutory basis in accordance with internal guidance which was available only to them at the operative time. That guidance was only disclosed to the claimant midway through these proceedings. Consequently, he was entirely dependent on the CSA to inform him of how the matter had to be approached and what facts and materials might be relevant to the decision. In those circumstances, it was incumbent on the CSA to make their own enquiries so that they could exercise their discretion taking into account all the relevant circumstances of the case. If the position was, as they now argue it was, that an agreement that the school fees were to be paid in lieu of maintenance could be relevant to the exercise of their discretion, they should have asked enough questions to establish whether there may have been such an agreement and then invited each parent to provide more details on the subject. It would have been a straightforward enquiry. I suspect that it was not pursued because of the confusion in the CSA’s own mind over the nature of their discretion. It is no surprise that in these circumstances the claimant provided them with details and materials in dribs and drabs and Mrs Green did not provide a detailed account of the situation at the time of the school fees payment until April 2007 when she was spoken to as part of the CSA’s preparations for impending judicial review.

What was required, in order for the CSA to exercise their discretion validly, was for the claimant to be given an opportunity to marshal his material and present his case as fully and cogently as he could to them, in the knowledge of the target that he had to hit, and for Mrs Green also to be given the opportunity to set out her side of the story, similarly in the knowledge of what the issue was that was being explored. The CSA would then have considered, as their Guidance contemplated, whether the evidence provided was sufficient for the exercise of their discretion and what was established on the balance of probabilities.

The defendant submits that, despite becoming aware of the importance of an agreement on the part of Mrs Green that the school fees payments were in lieu of child support, the claimant has failed to produce evidence which establishes this. If it is, in fact, impossible for him to establish it, then there would be no point in requiring the CSA to consider the matter again, although they express themselves, in the Detailed Grounds of Defence, as willing to consider any further material with which they are presented. I have been troubled by this point. I have very serious doubts whether the claimant has any prospect at all of establishing a relevant agreement. I agree with the CSA that the material which the claimant has so far presented as evidence of such an agreement does not establish the point. He can establish that Mrs Green wanted Thomas to be educated privately, as did he. He can establish that she knew he was paying the school fees, including the £6,000, and that she was insistent on him doing so. Where he is in more difficulty is in establishing that she agreed that this was a payment in lieu of child maintenance. I was invited to infer that from the fact that the letters from Mrs Green’s solicitors in the ancillary negotiations dealt with school fees under the heading “Maintenance” but I am doubtful of the weight of this. The account set out in the claimant’s solicitors’ letter of 28 July 2006 also makes me pause for thought. The full passage can be found set out above but in essence, the solicitors say that the ancillary relief order provided for Thomas’ Mini to be sold and £6,000 paid from the proceeds to the school but that “to avoid a sale” of the car, the claimant increased the divorce settlement to Mrs Green by that amount to avoid the necessity of a sale. If the import of that is that the £6,000 was paid in order, in fact, to prevent Thomas’ car having to be sold to fund school fees, then it may be difficult to argue that the money was paid “in lieu of child maintenance”. Ultimately, it seems to me, however, that it is impossible to evaluate the claimant’s case securely without him first having a chance to present it properly and Mrs Green then commenting on it. The procedural unfairness that I find to have been part and parcel of the CSA’s approach to the school fees question may well have prejudiced his ability to do this thus far and that needs to be corrected. Plainly both parties need to be relieved of this litigation, and indeed of the school fees wrangle, which have gone on far too long. However, as much of the evidence has been trawled through in the course of these proceedings, I would be very hopeful that a fresh decision could be taken by the CSA without delay.

I turn finally to the issue of delay. I considered this at the time of the application to expand the grounds for review and did not take the view that it ought to prevent that course. Cranston J’s permission in relation Ground 4 expressly reserved the right of the defendant to rely on delay in the substantive hearing. I therefore propose to deal with the question, albeit quite briefly.

It has been argued by the defendant that the decision that the claimant seeks to review was taken in January 2003 and communicated to the claimant then and at intervals thereafter and it was far too late to issue a claim in April 2007. The decision to serve a notice of intention to apply for a liability order in January 2007 was merely, it is said, an enforcement decision and not a decision about whether or not to offset the school fees against maintenance which is the decision about which the claimant really complains.

The chronology which I have set out earlier amply demonstrates the to-ing and fro-ing that took place in an effort to achieve a resolution of this matter. To take just one example, in September 2006, the CSA withdrew their first magistrates’ court application “in view of the outstanding issues still unresolved”, and that was by no means the end of attempts to sort the matter out. It would, in my view, be invidious if these entirely proper attempts to reach an accommodation without proceedings were then treated as a reason to refuse the claimant relief. The importance of the CSA’s 30 January 2007 notice of intention to apply for a liability order was that it clearly indicated the end of the road for a negotiated settlement and the judicial review proceedings were commenced within 3 months of that and, in my view, sufficiently promptly.

The flaws in the CSA’s decision making process must lead, in my view, to their decision on the school fees payments made by the claimant being quashed.