Appeal No. UA-2024-001085-USTA
Between:
MK
Appellant
- v -
The Secretary of State for Work and Pensions
Respondent
Before: Deputy Upper Tribunal Judge Hocking
Decided on consideration of the papers
Representation:
Appellant: In person
Respondent: Uroosa Ali, DWP
On appeal from
Tribunal: Social entitlement chamber
Tribunal Case No: SC147/22/00119
Tribunal Venue: Sheffield
Decision Date: 13/10/2023
DECISION
The decision of the Upper Tribunal is to allow the appeal
DIRECTIONS
This case is remitted to the First-tier Tribunal (“FtT”) for reconsideration at an oral hearing.
It must be heard by an entirely fresh panel.
The FtT must conduct a complete rehearing of the issues that are raised by the appeal and, subject to the FtT’s discretion under section 12(8)(a) of the Social Security Act 1998, any other issues that merit consideration. While the FtT will need to address the grounds on which I have set aside the decision, it should not limit itself to these but must consider all aspects of the case, both fact and law, entirely afresh.
The new FtT is not bound by the decision of the previous FtT. Depending on the findings of fact it makes, the new FtT may reach the same or a different conclusion to the previous FtT. The fact that this appeal has succeeded on a point of law carries no implication as to the likely outcome of the rehearing, which is entirely a matter for the FtT to which this case is remitted.
These Directions may be supplemented by later directions by a Tribunal Judge in the Social Entitlement Chamber of the FtT.
REASONS FOR DECISION
Decision on the papers
The respondent does not request an oral hearing. I am unclear if the appellant requests an oral hearing. He requested (and received) an oral hearing for the application for permission to appeal. His response to the respondent’s submissions is an email dated 14 May 2025 entitled Formal Complaint Regarding Court Hearings and Conduct of the DWP/Universal Credit which does not entirely respond to those submissions (although some of it deals with some of the issues in the appeal) which does not say whether or not he would like an oral hearing.
In order to dispel any confusion I should explain to the appellant that the Upper Tribunal does not deal with “complaints” about court hearings or the DWP, it deals with appeals on points of law from FtT decisions. (In some cases the same facts may give rise to an appeal and a complaint and in others they will not.) There are complaints processes that are completely separate to Upper Tribunal proceedings. The appellant having sent his email of 15 May 2025 to the Upper Tribunal will not have triggered any complaints process. I do not know if he intended that it should or not, but if he did he will have to resend it to the appropriate email addresses.
Considering rules 34 and 2 of the Tribunal Procedure (Upper Tribunal) Rules 2008 I am satisfied that I can deal with the case fairly on the papers, and that it is in the interests of justice that I do so.
Factual background and the grounds of appeal
I adapt this background from DUTJ Scolding KC’s grant of permission to appeal. MK had claimed tax credits/universal credit since 2017. In October 2020 a sum of £11,000 came into his account from the sale of a car, and £36,000 from the sale of a van. Between October 2020 and 1 February 2021 there was more than £16,000 in his bank account.
As a result the DWP determined that he was not entitled to Universal Credit between those dates, because he had in excess of the maximum capital allowed. MK appealed that decision to the FtT.
There have been three hearings in front of the FtT relating to this case. The first, on 10 June 2022 refused the appeal in MK’s absence. He wrote to set aside that decision because he did not receive notification of the hearing on 22 June 2022. That decision was set aside on 27 January 2023.
The second hearing took place on 14 June 2023. This time both parties attended. The appeal was refused. MK was not happy with the conduct of the hearing and asked for the full recording of the hearing “to show how incompetent the judge was”. The First Tier Tribunal subsequently set aside that decision because HMCTS had failed to preserve the audio recording of the hearing which comprised the formal record of proceedings.
There was then a further oral hearing held on 13 October 2023. This time the DWP were not present at the hearing. MK said that meant he was unable to ask questions that he wished to about their decision making. He was also again critical of the conduct of the judge and asked for a copy of the recording of the hearing. Remarkably, the equipment had again failed to record proceedings properly. MK was both aggravated by and suspicious about that failure, understandably so.
Grounds of appeal
Judge Scolding gave permission to appeal on three grounds:
Absence of a record of the proceedings is a material procedural irregularity.
The appellant could not ask questions of the DWP and this was a material procedural irregularity
The capital requirements were never explained to MK and as he was taking action to secure his home, which would be subject to a capital disregard, so the capital in his bank account should be disregarded. Judge Scolding appears to have been sceptical on that point but to have given permission “so that the Secretary of State has a chance to identify the position in law and to provide adequate explanation of such and so that the matter can be discussed at any further hearing”
The respondent’s reply
The respondent supports the appeal on the first two grounds and opposes it on the third. On the first ground they say this:
The importance of having a record of proceedings is detailed in paragraph 36 of DT v SSWP (II) [2015] UKUT 509 (AAC) the “appellant needs the record of proceedings to make an informed decision when to appeal.” In this case, the appellant has made several complaints regarding the way the hearing had been conducted. The appellant at the UT oral hearing for permission to appeal, stated to the UT Judge ‘the judge was rude, and a couple of times during the hearing said that he did not want to hear from [MK]..’ (UT DN, page 21, paragraph 20). The appellant also stated to the UT Judge ‘the judge’s tone of voice and gestures demonstrated an attitude which he described as discriminatory’ (UT DN, page 21, paragraph 20).
Additionally, the Practice Statement on Records of Proceedings in Social Security and Child Support Cases in the Social Entitlement Chamber sets out the following:
‘2. A record of the proceedings at a hearing in a social security and child support case must be made by the presiding member, or in the case of a Tribunal composed of only one member, by that member.
The record must be sufficient to indicate any evidence taken and submissions made and any procedural applications, and may be in such medium as the member may determine.’
Whilst the Tribunal Procedure (First-tier Tribunal) (Social Entitlement Chamber) Rules 2008 do not expressly require the FtT to make and keep a record of proceedings, by not keeping a record, the FtT have not followed the Practice Statement set out by the Senior President of Tribunals.
On the second point they say:
In the FtT’s direction notice dated 20/07/2023, the FtT directed the PO to be present at the third hearing stating ‘The attendance of a presenting officer to appear on behalf of the respondent is required’ (FtT bundle, addition F, page 2). However, at the third hearing the PO was absent, the FtT made reference of the absence at paragraph 3 of the SOR stating ‘The Respondent did not attend’ but there is no explanation from the FtT on why they decided to proceed without the PO present (FtT bundle, addition K, page 1). The FtT have failed to comply with Rule 7(2) of The Tribunal Procedure (First-tier Tribunal) (Social Entitlement Chamber) Rules 2008 which states –
‘(2) If a party has failed to comply with a requirement in these Rules, a practice direction or a direction, the Tribunal may take such action as it considers just, which may include—
(a)waiving the requirement;
(b)requiring the failure to be remedied;
(c)exercising its power under rule 8 (striking out a party's case); or
(d)exercising its power under paragraph (3).’
The FtT should have considered which course of action to take …
As per paragraph 24 in MT v Secretary of State for Work and Pensions (IS) [2010] UKUT 382 (AAC) which states –
‘...there are a number of generic factors that must be considered in deciding which course of action best serves the interests of justice. These include the role the presenting officer might be expected to play, the effect that the absence of a presenting officer may have both on the tribunal’s position in hearing the appeal and on the claimant’s ability to formulate and present a critique of the decision under appeal.’
It is clear in the appellants letter dated 28/04/2024, in permission to appeal to the UT that he required the PO to be present to be able to answer questions he had relating to the decision under appeal. The appellant stated that ‘The vital questions could not be answered’ and that ‘The representative for benefits did not even turn up!’ (FtT bundle, addition I, page 6). Therefore, fairness would dictate the PO to be present.
And on the third point they say:
Regulation 46 of the Universal Credit Regulations 2013 states that the whole of a person's capital is to be taken into account unless it is to be treated as income, or it is to be disregarded. Although there is no definition of capital in the legislation, what is meant by capital can be found in general law, and as per regulation 46(3), is generally by implication anything that is not in its nature an income. There can be, it could be argued, a level of common-sense thinking that could be applied to determining whether something is or is not capital based on the above - if something is not income, and is not expressly treated as capital, this would count as capital.
The FtT, in their decision, stated the sums of £36,000 and £11,000 held in the appellants and his partners accounts from October 2020 were in excess of the prescribed amount, and though the appellant and his partner were not aware of specific regulations relating to their capital, they still had a responsibility to declare capital. The Secretary of State (SoS) submits that there has been no error of law made by the FtT here.
The appellant has stated in his submission that when he made his claim, he was told he could not have more than £16,000 in savings in his bank account but was not given any further information about what counted as capital at this time. However, in October 2020 the appellant sold both his wife's car for £11,000, and his van for £36,000, which was saved in his account until February 2021. Even without any further knowledge about what is and is not capital for Universal Credit, the appellant has himself stated that he was aware he could not have more than £16,000 saved in his bank, which of course, he had because of these sales. Being aware he held £47,000 saved in his account, and being aware than even on the little information he states he was given about capital for Universal Credit, at this point it would follow that the appellant should have made the SoS aware of these monies so it could be determined whether they could be disregarded under Schedule 10 of the Universal Credit Regulations.
Decision
On the first point, while there is a requirement to have a record of proceedings, there is not as such a requirement to have an audio recording. However this case amply demonstrates why not having audio recording may amount to a procedural irregularity vitiating the decision. MK says he was treated disrespectfully not once but twice, and goes so far as to say he suspects that he was subject to unlawful discrimination. Without a recording of exactly what was said and how it was said it is impossible for the Upper Tribunal to determine whether these allegations are well founded. The record keeping of the FtT thus does not allow the Upper Tribunal to exercise its supervisory jurisdiction effectively on the facts of this case. Were the appeal to be dismissed there is a danger the Upper Tribunal would have been complicit in maintaining a seriously irregular decision. That is not a risk that can be run while maintaining confidence in the tribunal process. That alone means the appeal must be allowed.
Put another way, the material; before the Court includes allegations by MK, and no material at all to the contrary. The outcome of the appeal is inevitable.
The lack of a recording has let MK down and it has let the FtT judges down who are unable to respond effectively to these allegations. I spell out that in allowing the appeal on this ground I am NOT finding either that the underlying allegations of unacceptable judicial conduct are made out, or that they are not made out: the point is one cannot even address the question. I also add that I agree with Judge Scolding that the failure of the recording equipment is much more likely to have been accidental than deliberate, not that that makes it any more acceptable, or any difference to the disposal of this appeal.
Sas to the second point, the absence of the PO, It was open to the FtT to proceed, (applying rule 31 and rule 2 of The Tribunal Procedure (First-tier Tribunal) (Social Entitlement Chamber) Rules 2008) but that required an express decision weighing the factors for and against proceeding. It was known that MK wanted to put questions to the PO. It may have been difficult to see what effective questions could be put but even if that was the case it would be no answer. Osborn v The Parole Board [2013] UKSC 61 makes clear that a fair process serves a number of purposes:
There is no doubt that one of the virtues of procedurally fair decision-making is that it is liable to result in better decisions, by ensuring that the decision-maker receives all relevant information and that it is properly tested. As Lord Hoffmann observed however in Secretary of State for the Home Department v (AF (No 3) [2009] UKHL 28; [2010] 2 AC 269 , para 72, the purpose of a fair hearing is not merely to improve the chances of the tribunal reaching the right decision. At least two other important values are also engaged.
The first was described by Lord Hoffmann ( ibid ) as the avoidance of the sense of injustice which the person who is the subject of the decision will otherwise feel. I would prefer to consider first the reason for that sense of injustice, namely that justice is intuitively understood to require a procedure which pays due respect to persons whose rights are significantly affected by decisions taken in the exercise of administrative or judicial functions. Respect entails that such persons ought to be able to participate in the procedure by which the decision is made, provided they have something to say which is relevant to the decision to be taken. As Jeremy Waldron has written (“ How Law Protects Dignity” [2012] CLJ 200 , 210):
“Applying a norm to a human individual is not like deciding what to do about a rabid animal or a dilapidated house. It involves paying attention to a point of view and respecting the personality of the entity one is dealing with. As such it embodies a crucial dignitarian idea – respecting the dignity of those to whom the norms are applied as beings capable of explaining themselves.”
This point can be illustrated by Byles J's citation in Cooper v Wandsworth Board of Works (1863) 14 CB (NS) 180 , 195 of a dictum of Fortescue J in Dr Bentley's Case ( R v Chancellor of Cambridge, Ex p Bentley (1748) 2 Ld Raym 1334 ):
“The laws of God and man both give the party an opportunity to make his defence, if he has any. I remember to have heard it observed by a very learned man, upon such an occasion, that even God himself did not pass sentence upon Adam before he was called upon to make his defence.”
The point of the dictum, as Lord Hoffmann explained in AF (No 3) at para 72, is that Adam was allowed a hearing notwithstanding that God, being omniscient, did not require to hear him in order to improve the quality of His decision-making. As Byles J observed ( ibid ), the language used by Fortescue J “is somewhat quaint, but … has been the law from that time to the present.”
This aspect of fairness in decision-making has practical consequences of the kind to which Lord Hoffmann referred. Courts have recognised what Lord Phillips of Worth Matravers described as “the feelings of resentment that will be aroused if a party to legal proceedings is placed in a position where it is impossible for him to influence the result” Secretary of State for the Home Department v AF (No 3) [2009] UKHL 28; [2010] 2 AC 269 , para 63)
The second value is the rule of law. Procedural requirements that decision-makers should listen to persons who have something relevant to say promote congruence between the actions of decision-makers and the law which should govern their actions.
The reference to “feelings of resentment” having been aroused seems particularly apt here.
What was required was for the FtT to address rule 31 expressly, including reference to rule 2 the factors described in Osbourne, and the fact that the PO had been ordered to attend, weigh the considerations in favour of continuing or adjourning, and reach a reasoned decision. Had it done so it is unlikely that either a decision to proceed or to adjourn could have been successfully challenged on appeal. I do not go as far as the respondent in saying that fairness could only have required that the PO be present; (although it is certainly a weighty consideration). There were other factors in play. The problem is the failure to weigh all the factors in light of the rules.
As to the third point, as the case must be remitted to the FtT in any event I will take no decision on it. I take this opportunity to point out to the appellant that because this appeal has succeeded it in no way follows that the outcome of the rehearing in the FtT must be any more favourable to him than at any of the hearings to date. However he will be able to respond to what the Secretary of State has said above and make whatever case he wishes to the FtT, and it is wrong for me to anticipate what the outcome of that may be. I leave that to the FtT.
Conclusion
Neither party has asked me to retake the decision. Notwithstanding their position on the substantive capital point the Secretary of State invited me to remit the case to an FtT for a fresh decision. In view of the procedural history to date that is the right course of action. I hardly need to say in light of that history that the FtT would be very well advised to ensure that an audio recording of any future proceedings is made and preserved, in the interest of MK and of the FtT panel members.
Under section 12(2)(a) and (b)(i) of the Tribunals, Courts and Enforcement Act 2007 I therefore set the FtT decision aside and remit the case to be reconsidered by a freshly constituted panel. .
Stephen Hocking
Deputy Judge of the Upper Tribunal
Authorised by the Judge for issue on 16 September 2025