IN THE UPPER TRIBUNAL	Appeal No.  CPC/1530/2009
ADMINISTRATIVE APPEALS CHAMBER

Before Judge S M Lane

Decision:  The First-tier Tribunal’s decision is set aside because it involved the making of an error of law.  The appeal is remitted to a differently constituted tribunal for a rehearing on all issues.

REASONS FOR DECISION

1. The Secretary of State brings this appeal, with my permission, against the decision of the Blackpool First-tier Tribunal heard under reference no. 064/08/01415 on 9/2/09.  The issue in the appeal is whether the claimant’s State Pension Credit should include an amount in respect of housing costs in the form of interest on a mortgage for the property in which they resided.  The tribunal replaced the Secretary of State’s decision to refuse housing costs with a decision to allow them by virtue of Schedule II, paragraph 3(b) of the State Pension Credit Regulations 2002, which provides that 

A person is liable to meet housing costs where…(b) because the person liable to meet the housing costs is not meeting them, the claimant has to meet those costs in order to continue to live in the dwelling occupied as the home, and it is reasonable in all the circumstances to treat the claimant as liable to meet those costs.  

2. The facts were that the claimant and her husband had organised the purchase of the present property and mortgaged it in their son’s name, using money from the sale of a previous property which had also been purchased and mortgaged in their son’s name.  The money from the sale of the previous property had been paid directly to their son before being re-used.  The claimant and her husband had taken this course of action because they wished to provide for the future of their son, who was disabled and had learning difficulties.  The couple had been told that they would not be able to get a mortgage in their own names because of their ages, but had undertaken responsibility for paying the mortgage on behalf of their son.  They had been allowed housing costs on their previous property in the same circumstances.  Their son did not work all of the time, and when he did so, it was for a low wage.  When on Jobseeker's Allowance, he did not claim housing costs because he would have to serve a waiting period before qualifying for them.  Their son did not contribute to the mortgage, but contributed towards household expenses when he was working.  

3. The application of paragraph 3(b) is not simply a matter of finding that, because ‘A’, who is liable to pay the mortgage is not doing so, then ‘B’ who lives there, must do so in order to remain living there.  This is made plain in CIS/14/1993, which relates to paragraph 2(1)(b) of Schedule 3 of the Income Support (General) Regulations 1987, where the commissioner held, in my view rightly, that in order for this provision to apply, there had to be an immediate threat to the continued occupation of the home, not a theoretical possibility of this happening in the future.  The tribunal did not make any findings of fact to this effect and looking at the evidence as a whole, I can see none.    

4. The Secretary of State has also submitted that the tribunal has not given sufficient reasons for finding it reasonable to treat the claimant as liable for meeting the housing costs.  I accept that this is the case, and amounts to an error of law.  What the tribunal found reasonable, without giving any explanation, had the effect of simply transferring entitlement for housing costs from the son, who was working and (with or without tax credits) might have been able to obtain a mortgage in his own right, to his parents.  The arrangement had the effect of paying housing costs by proxy to a person who might not have been so entitled.  

5. I am remitting the appeal to a First-tier Tribunal to explore the facts further.  It may be that there were circumstances within the rule laid down in CIS/12/1993 which would enable the claimant to bring herself within paragraph 3(b) of Schedule II, but that they were not explored because of the tribunal’s erroneous view of the law.  

[Signed on original]						S M Lane
Judge of the Upper Tribunal

[Dated]				10 December 2009