[2005] UKSSCSC CCS_185_2005 (28 April 2005)
DECISION OF THE CHILD SUPPORT COMMISSIONER
- My decisions are given under section 24(2) and (3)(d) of the Child Support Act 1991. They are:
I SET ASIDE the decisions of the Preston appeal tribunal, held on 31 August 2004 under references U/06/038/2004/00139 and U/06/075/2004/00085, 00815 and 00827, because they are erroneous in point of law.
I REMIT the cases to an appeal tribunal consisting of Mr D J Britton and DIRECT as follows.
A district chairman may change the constitution of the tribunal if it is impossible or impracticable for Mr Britton to sit.
If the tribunal consists of Mr Britton he need only deal with the issues identified below. Otherwise, the appeal tribunal must conduct a complete rehearing of all the issues that are raised by the appeals and, subject to the tribunal's discretion under section 20(7)(a) of the 1991 Act, any other issues that merit consideration.
The appeals to the Commissioner
- These four cases concerns two formula assessments of child support maintenance in respect of Vanessa and Leonard. For Vanessa, her father is her parent with care and her mother is absent parent. For Leonard, the roles are the reverse. For convenience, I refer to the parents as father and mother and not by reference to their status under the child support legislation.
- All the appeals were brought before the Commissioner by the mother with the leave of a district chairman of tribunals. The details of the appeals are:
| Commissioner's reference |
Tribunal reference |
Qualifying child |
Effective date |
Appellant to the appeal tribunal |
| CCS/0185/2005 |
U/06/038/2004/00139 |
Leonard |
19.04. 2002 |
Father |
| CCS/0187/2005 |
U/06/075/2004/00085 |
Leonard |
19.04.2002 |
Mother |
| CCS/0188/2005 |
U/06/075/2004/00815 |
Vanessa |
4.02.2002 |
Mother |
| CCS/0190/2005 |
U/06/075/2004/00827 |
Vanessa |
4.02.2002 |
Father |
- Despite this plethora of appeals, all four cases raise the same issues.
Disposal
- I allow all four appeals and direct a rehearing.
- All four appeals were heard together by Mr D J Britton. He has made some mistakes, but they are not such as to give either parent or the Secretary of State any cause to doubt his inability to correct them competently and impartially. I judge it more appropriate that he should correct the mistakes rather than that all the issues should be reconsidered afresh by a differently constituted tribunal. However, I have authorised a district chairman to override my direction on the constitution of the tribunal, if this is necessary.
- In giving my case management directions, I intimated that I would substitute a decision rather than direct a rehearing. However, in view of an issue identified by the Secretary of State's representative, I consider that a rehearing is more appropriate than a decision by me on the papers. I say that because the issue turns in part on the credibility of the evidence given, which is better judged at an oral hearing than on paper.
The issues
- Most of the issues concern the tribunal's decision that the maintenance assessments should include an amount of notional rent attributed to the mother. The relevant circumstances are that the notional rent relates to premises occupied by the parents of the mother's husband. They occupy those premises without paying rent as a quid pro quo for them continuing to employ and pay the husband, despite the fact that he is unable to work for much of the time.
Intention
- As the Secretary of State points out, and as I missed when giving my case management directions, the tribunal could only have attributed this rent to the mother under paragraph 27 of Schedule 1 to the Child Support (Maintenance Assessments and Special Cases) Regulations 1992 on the basis that it was income that it was reasonable to expect her to secure. However, the tribunal did not explain how it dealt with the conditions on which that paragraph depends. Specifically, the paragraph only applies if the mother intentionally failed to secure this income with a view to reducing the amount of her assessable income.
- The father has provided detailed argument that the mother did have the intention required by paragraph 27. The mother disputes this. I suspect that this will be a hotly contested issue and it is for this reason that I have directed a rehearing.
- I direct the tribunal to investigate and determine the mother's intention in respect of the rent that could be obtained for the premises.
Ownership of premises
- The Secretary of State also points out that the tribunal did not investigate and determine the ownership of the premises. As the Secretary of State explains, if the premises were jointly owned, most likely by the mother and her husband, she would only be attributed with her proportionate share of the rent that could be obtained for the premises. The father has provided for me documents which purport to be a copy of the land registration for the premises, which show the mother as the sole owner. It may be that the mother does not say otherwise.
- I direct the tribunal to investigate and determine this issue, if it arises. I say 'if it arises' for two reasons First, because it may not be a matter of dispute. And second, because it will be irrelevant if the tribunal decides on investigation that paragraph 27 does not apply.
Tax
- This was the issue raised by the mother on her appeals. The tribunal did not direct that income tax be deducted from the notional rent attributed to the mother. She argues that income tax should be deducted. Her argument is supported by paragraph 2 of Schedule 2 to the Regulations. This provides for the disregard of
'An amount in respect of income tax applicable to the income in question where not otherwise allowed for under these Regulations.'
- Paragraph 27 of Schedule 1 provides that the income attributed shall be part of the parent's net income. And paragraph 32 of that Schedule provides that the amount of income attributed to a parent under paragraph 27 must be determined as if it were other income for the purposes of Part III of that Schedule. Net income is calculated under regulations 7 and 8. It includes income determined in accordance with Part III. It excludes any amount specified in Schedule 2. So, on the face of it the mother is correct that income tax should be deducted from the income attributed to her. This would make sense, as income tax would be deducted if she were actually receiving rent.
- The Secretary of State's representative does not refer to paragraph 2 of Schedule 2. Instead, he refers to paragraph 23. This provides for disregards of certain amounts for a parent who is not a self-employed earner. In this case, the mother is an employed earner. The representative's reasoning is not at all clear to me and I can only speculate on the precise form of the argument he meant to present. The best sense I can make of his submission is that he is arguing that paragraph 23 is comprehensive on disregards from rent for those who are employed earners. If that is his argument, I do not accept it. Paragraph 23 deals with some disregards that are appropriate for parents who are not self-employed. If they are self-employed, they will be subject to the rules in Chapter 2 of Part I of Schedule 1. I can think of no reason why paragraph 23 should displace paragraph 2. It does not say that it does and I cannot identify any policy that would be furthered if it did so.
- I direct the tribunal that rehears this case that any notional income from rent must be reduced by the amount of appropriate disregards under Schedule 2, including paragraphs 2 and 23.
Father's income
- I also direct the tribunal to deal with the point made by the father in paragraph 8 of his observations on the appeals.
Signed on original
on 28 April 2005 |
Edward Jacobs
Commissioner |
