[2008] UKSSCSC CAF_1071_2006 (05 February 2008)

CAF/1071/2006

DECISION OF THE SOCIAL SECURITY COMMISSIONER
  
1.	These appeals are unsuccessful.  I set aside the decision of the Pensions Appeal Tribunal dated 18 September 2005, for which reasons were given on 10 November 2005.  However, I give a decision to the same effect.  The awards of disablement pension dated 17 October 1994 and 20 February 1995 are reviewed but not revised.  

REASONS

2.	I held an oral hearing of this appeal.  Mr Paul Stagg of counsel, instructed by Ms Finola O’Neill of Wandsworth and Merton Law Centre, appeared for the claimant and Mr Jonathan Auburn of counsel, instructed by the Treasury Solicitor, appeared for the Secretary of State.  I am grateful to both of them for their helpful submissions, including substantial written submissions made in response to a direction I issued after the hearing.  The case raises some complicated procedural issues that appear to be of general application in cases such as these and I will deal with them at some length before I consider the submissions made as to how the law should be applied in this case.

The facts and procedural history of the case

3.	The claimant served in the Army Catering Corps from 28 December 1967 to 26 May 1974, being latterly attached to the 1st Battalion of the Welsh Guards.  He was discharged from the Army for misconduct.  During the year before his discharge he had been convicted in three civilian courts of large numbers of offences of dishonesty and he had also had findings of guilt made by his Commanding Officer and by a district court martial in respect of various military offences.  On 1 March 1974 he was admitted to a military hospital under escort having taken an overdose.  He escaped from the hospital despite his escort but was rearrested and was detained at Colchester military prison until his discharge on 26 May 1974.  The tribunal found that the claimant had been suffering from manic depressive psychosis during his service in the Army, that he should have been referred for a psychiatric assessment after his overdose and that that was not done, that he should not have been given a M2 S2 assessment at his final PULHEEMS assessment, that his medical examination in prison should have resulted in him being referred to a psychiatrist and that he should have been referred to a medical board.  The military authorities did not appreciate that the claimant was suffering from mental illness.  However, when he was discharged, the claimant had himself admitted to the Priory in Roehampton.  After a while, he went to the United States of America, where it appears he continued to suffer from the effects of his illness, returning to the United Kingdom in 1981.  For the next ten years, he was under the care of psychiatric hospitals for much of the time, sometimes as an in-patient but mostly as an out-patient.

4.	On 2 December 1991, he claimed a disablement pension under the Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Order 1983 (S.I. 1983/883), that claim being treated as effective from 20 November 1991 when the claimant had first indicated that he wished to claim.  The claim was originally disallowed but, following an entitlement appeal that led to a finding that he was suffering from manic depressive psychosis aggravated by his service, he was eventually awarded, on 17 October 1994, a disablement pension based on an interim assessment of 30%.  The award was made effective from 20 November 2001.  

5.	On 13 January 1995, according to a submission made on behalf of the Secretary of State, the claimant made a telephone enquiry regarding backdating.  On 20 February 1995, he was informed that the assessment had been increased to 50% with effect from 4 November 1994.  This was an interim assessment effective until 28 February 1999 and appears to have followed his examination by a medical board on 9 February 1995 in connection with a request for review made on 4 November 1994.  The decision letter referred to “a claim for deterioration”, which is a surprising basis for an application for review made within a month of the previous assessment.  There is reference in one of the Secretary of State’s submissions to the claimant having said in December 1994 that he wished to “appeal” and it is possible he just challenged in a general way the assessment that had been made and it was the Secretary of State who pigeon-holed the case as one based upon a change of circumstances rather than error of fact.  The “summary of assessments” suggests that the first assessment was for a period ending on 3 November 1994, but it seems highly unlikely that the assessment notified on 17 October 2004 was for such a limited period.  It is much more likely that the assessment was originally made for a longer period and only ceased to have effect after 3 November 1994 due to a review.  I regard it as significant that whatever action was taken followed close behind the initial award based on the 30% assessment.

6.	On 3 March 1995, the claimant made a telephone call asking why the increase in his pension had only been made from November 1994 and not from the day after he left the forces.  A minute suggests that he was spoken to again on the telephone on 6 March 1995 and records that the claimant “will be writing in about backdating – was too ill to claim – in hospital 2 years”.  However, nothing further is recorded until, on 13 June 1996, the Royal British Legion wrote to the War Pensions Agency –

“[The claimant] has contacted this office with reference to the backdating of his award for Manic Depressive Psychosis to his release date from the Army on the 26th May 74.

He was under the impression that the late Mr Tom Keating was in contact with you over this matter, presumably on the grounds that [the claimant’s] Manic Depressive Psychosis would have been of such severity as to prevent him from exercising his rights to make a new claim at that time.

Could you please confirm that Mr Keating had been in touch with you regarding this claim and whether or not you have already given consideration to [the claimant’s] request.”

7.	There is no record of a direct response to that letter but, on 15 July 1996, in the context of another review of the assessment on the ground of deterioration that appears already to have been on foot, the Department of Social Security’s medical services were asked to advise whether the claimant’s illness would have prevented him from claiming prior to 20 November 1991.  A Doctor Bell replied two days later to the effect that the claimant’s condition was fluctuating by its nature and that “[t]here may have been periods when he was not fit to claim but there were also periods when he was fit to claim.”  The claimant was examined in connection with the review of the assessment and evidence was obtained from his general practitioner but there is no evidence that any decision was made on the question of the date from which the award should have been effective.

8.	On 18 April 2001, the claimant’s Member of Parliament wrote to the Parliamentary Under Secretary of State for Social Security, suggesting that the increase to 50% “should have been backdated to the original claim date”.  On 21 May 2001, the Minister replied, saying –

“The War Pensions Agency (WPA) has initiated a further review of [the claimant’s] claim for backdating of his WDP.  However, it has still not been able to identify evidence which would support his award being backdated in this case.  May I explain that The Royal British Legion did approach the WPA to consider backdating in 1996 but I am afraid that the request was overlooked and [the claimant] was not informed of the decision or the reasons why backdating was not appropriate.

…

The legislation under which [the claimant’s] WDP has been awarded provides that where the claim was not made within three months of termination of service, payment of pension shall not be made for any period before the date of claim, unless the Secretary of State for Social Security otherwise directs.

The Secretary of State’s discretionary powers are used to backdate awards of WDP in exceptional circumstances, where it is considered reasonable to do so.  Examples of this would be where there has been Departmental error or misdirection, or where the claimant was prevented by illness from, or had some other good reason for, not claiming earlier.”

9.	In June 2001, the Member of Parliament apparently wrote again to ask that the claimant’s award be backdated to the time of the claimant’s discharge on the ground that he had been unable to claim earlier due to mental illness.  An internal minute dated 21 January 2002 states –

“2.	Both DF and Dr B have seen this case and we feel there may be an issue with MoD’s actions where the possibility of mental illness arises.  This of course should not be discussed at this stage, if at all.

3.	In view of the scanty independent post-discharge evidence, we need to review the case supported by evidence from a regional Consultant.”

10.	A psychiatric report dated 11 July 2002 was duly obtained and, in the light of it, the Secretary of State made a decision on 12 September 2002 that was given to the claimant in the following terms –

“Our medical adviser has confirmed that the earlier decision remains appropriate with effect from 4 November 1994.  As explained in our earlier correspondence the Secretary of State had found no reasonable grounds to justify a departure from our normal policy.  I am therefore unable to direct that payment of your award of 50 per cent should be made for any period before 4 November 1994.”

It may be observed that that does not specifically address the question whether the award of 30%, or some different award, might have been appropriate in respect of the period before 20 November 1991, even though the Member of Parliament had plainly raised that as an issue.

11.	The claimant was told that he could appeal against both that decision and the decision of 17 October 1994, although he was warned that he would be out of time for appealing in respect of the latter decision.  The claimant duly appealed against both decisions, seeking backdating to 26 May 1974 under paragraph 5 of Schedule 3 to the Service Pensions Order.  Somewhat surprisingly, a tribunal admitted the late appeal against the decision of 17 October 1994 but that appeal has not yet, as far as I am aware, been determined and I anticipate that the Secretary of State will persuade the tribunal that the appeal against the earlier decision was admitted in error and that the tribunal has no jurisdiction to determine it (see CAF/1133/2007) as the tribunal’s rules do not permit an appeal to be admitted more than 12 months late. It seems fairly clear that a decision was issued on, or shortly after, 17 October 1994 because there is evidence of the claimant having reacted to it.  

12.	In any event, the appeal against the decision of 12 September 2002 came before the tribunal on 18 September 2005, after an adjournment on 22 April 2005 to give the Secretary of State an opportunity to respond to a new submission based on paragraph 10 of Schedule 3 to the Service Pensions Order as then in force.  The tribunal dismissed the appeal on the ground that the claimant did not fall within the scope of either paragraph 5 or paragraph 10.  The claimant now appeals against the tribunal’s decision with my leave.

The legislation

13.	By virtue of article 65 of the Service Pensions Order, Schedule 3 had effect with respect to commencing dates under the Order.  Schedule 3 had been amended from time to time, most notably when a whole new schedule was substituted by the Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Amendment Order 1997 (S.I. 1997/286), which came into force on 7 April 1997.  As originally enacted, paragraph 1 of Schedule 3 provided –

“1.	Except in so far as the Secretary of State may otherwise direct with respect to any particular case or class of case, payment of a pension in respect of disablement or as the case may be death, including payment of an increase in the rate of pension on account of an increased assessment of the degree of disablement, shall not be made in respect of any period preceding:
    (a)	in the case of a claim for pension as a result of which pension is awarded –
Item                 	Circumstances
applicable	Period within which claim
to pension to have been made	Day before which payment of pension
not to be made	
(i)

(ii)

(iii)	where termination of member’s service due to invaliding or he died during service

where termination of member’s service not due to invaliding or he did not die during service

where circumstances in either (i) or (ii) above apply	within 6 months of the date of such termination or, as the case may be, death

within 3 months of the date of termination or, as the case may be, death

claim not made within periods (i) or (ii) above as the circumstances applicable to the case may be	the day following date of such termination or, as the case may be, the day following date of member’s death.

the day following date of such termination or, as the case may be, the day following date of member’s death.

the date of the claim to pension	
    (b)	…, in the case of:
	… or,
	… or,
	a review under article 67
    as a result of which … review a pension is awarded or, as the case may be, restored –
Item	Circumstances
applicable	Period within which
claim to pension to
have been made	…, or

in other cases appli-
cation for review, or where
no such application, date
Secretary of State first
decided there should be a
review	Day before which payment
of pension not to be made	
(i)

(ii)

(iii)

(iv)	where termination of member’s service due to invaliding or he died during service

where termination of member’s service not due to invaliding or he did not die during service

where circumstances in either (i) or (ii) above apply

where circumstances in either (i) or (ii) above apply	within 6 months of the date of such termination or, as the case may be, death

within 3 months of the date of termination or, as the case may be, death

claim not made within periods (i) or (ii) above as the circumstances applicable to the case may be

claim not made within periods (i) or (ii) above as the circumstances applicable to the case may be	within 6 months of date of notification or rejection of claim or of withholding or reduction under article 6

within 3 months of date of notification of rejection of claim or of withholding or reduction under article 6

within 3 months of date of notification of rejection of claim or of withholding or reduction under article 6

… review not made within periods in (i) or (ii) above as the circumstances applicable to the case may be	the day following date of such termination or, as the case may be, the day following date of member’s death.

the day following date of such termination or, as the case may be, the day following date of member’s death.

the date of the claim to pension

…; in other review cases the date of application for review, or where no such application, the date the Secretary of State first decided there should be a review.	
    (c)	…

    (d)	In the case of a review under article 67 of an assessment as a result of which the rate of pension is increased –
Item	Circumstances applicable	Day before which payment of a pension
not to be made	
(i)

(ii)	where date review is applied for or, if there is no application for review, date Secretary of State first decided that there should be a review is within 3 months of notification of interim assessment, or 12 months in the case of a final assessment

where circumstances in (i) above do not apply	the date of commencement of assessment of degree of disablement

the date of application for review, or if no such application, the date the Secretary of State first decided that there should be a review.	

14.	The Schedule therefore made provision for the commencement date of awards following the determination of a claim, the determination of an entitlement review and the determination of an assessment review.  In summary, the effect was that a claim or review would not usually result in an award in respect of a period before the date of claim, application for review or decision to carry out a review, save where the claim was made within six months of the claimant either dying in service or being invalided out or within three months of service terminating on other grounds.  However, there was a general discretion to backdate, which was, in particular, exercised where there was a good cause for delay for medical reasons or due to official error, although it appears from Regina v. Secretary of State for Social Security, ex parte Foe (unreported, 7 November 1995) that backdating was limited to six years in the case of a review based on new evidence, that period being taken by analogy with other provisions in the Schedule.  (The period of five years mentioned in R(AF) 5/07 appears to be based on a single erroneous reference to such a period in Foe.)

15.	The new Schedule again made provision in respect of both claims and reviews, although it abolished the distinction between the two types of review and the drafting was much clearer.  Paragraphs 1, 5 and 10 provided –

“1.- (1)	Subject to the following provisions of this Schedule, an award or an adjustment to an award shall have effect from such date as may be specified in the award, being a date not earlier than the date specified in sub-paragraph (2) which is relevant to the claimant’s case.
    (2)	The date specified in this sub-paragraph is whichever date is the latest in time of the date -
      (a)	following the date of termination of service or, in a case under Part IV, following the date of death of the member;
      (b)	of the claim;
      (c)	of the last application for review; or
      (d)	[omitted as immaterial and subsequently revoked].
    (3)	Where in a case to which sub-paragraph (1) applies the claimant satisfies the requirements of sub-paragraph (4) the award shall have effect from the date the sub-paragraph is satisfied.
    (4)	This sub-paragraph is satisfied where the date of –
      (a)	the claim;
      (b)	the application for review;
      (c)	[omitted as immaterial and subsequently revoked],
whichever is appropriate in the claimant’s case, is made within 3 months of –
    (i)	the date of termination of service or, in the case of an award under Part IV, the date of death of a member, or
    (ii)	except where sub-head i) applies, the date of issue of notification of a decision on the claim, review or [omitted as immaterial and subsequently revoked].
    (5)	Where the requirements of sub-paragraph (4) are satisfied on more than one occasion and the occasions on which they are satisfied are consecutive, sub-paragraph (3) shall apply as from the last occasion on which sub-paragraph (4) is satisfied.
    (6)	Where an award is adjusted upon review instigated by the Secretary of State, the adjustment shall take effect from the date of the review.
    (7)	For the purposes of this paragraph a claim shall be treated as made for a pension or allowance for which a claim is not required by virtue of article 3B on the date on which the relevant conditions of entitlement to the pension or allowance first became satisfied.
…
5.	Where a claimant satisfies the Secretary of State that –
      (a)	he would have made a claim, an application for a review or [omitted as immaterial and subsequently revoked] on a date (the “earlier date”) earlier than that (“the actual date”) on which he actually did so but for the fact that he was incapable of so doing or for instructing someone to act on his behalf by reason of illness or disability; and
      (b)	that illness or disability continued to be the cause of the delay up to the moment the claim or application was made,
any reference in this Schedule to the date of a claim, application for review, or [omitted as immaterial and subsequently revoked] shall be treated as a reference to the later of –
(i)	the earlier date; and
(ii)	the date three years before the actual date.
…
10.	…, where a claimant satisfies the Secretary of State that –
      (a)	he would have made a claim, an application for a review or … on an earlier date than he actually did but for an administrative error on the part of the Secretary of State, the Secretary of State for Defence, or the Secretary of State for the Foreign and Commonwealth Office; and
      (b)	that error continued to be the dominant cause of the delay up to the moment the claim or application was made,
any reference in this Schedule to the date of a claim, date of application for review [omitted as immaterial and subsequently revoked] shall be treated as a reference to the earlier date referred t in this paragraph.”
   
16.	Perhaps the most significant change made by the 1997 Order was to remove the overriding discretion there had previously been by virtue of the opening words of paragraph 1 of the original schedule and to replace it by detailed provisions elsewhere in the schedule, of which paragraphs 5 and 10 are relevant in the present case.

17.	The new schedule was further amended by the Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Amendment Order 2001 (S.I. 2001/409), with effect from 9 April 2001.  Apart from making the amendments to paragraphs 1, 5 and 10 indicated above (and moving the word “or” where necessary in consequence), it made paragraph 1(6) subject to a new paragraph 1(6A), which provided –

“(6A)	Where an award is reviewed as a result of a decision (“the original decision”) which arose from official error, the reviewed decision shall take effect from the effective date of the original decision and for this purpose “official error” means an error made by the Secretary of State or any officer of his carrying out functions in connection with war pensions, defence, or foreign and commonwealth affairs, to which no other person materially contributed, including reliance on erroneous medical advice but excluding any error of law which is only shown to have been an error by virtue of a subsequent decision of a court.”

There is no equivalent to regulation 5 of the Social |Security and Child Support (Decisions and Appeals) Regulations 1999 (S.I. 1999/991) making specific provision for cases where the effective date of the original decision was itself wrong due to official error but the context suggests that the paragraph is to be construed so that the review can be effective from the date that would have been the effective date of the original decision had there not been the official error.

18.	It also amended paragraph 10 by substituting a new sub-paragraph (a) and, in consequence, substituting “act or omission” for “error” in sub-paragraph (b).  The new sub-paragraph (a) was in the following terms.

“(a)	he would have made a claim or an application for review on an earlier date than he actually did but for an act or omission of the Secretary of State or any officer of his carrying out functions in connection with war pensions, defence, or foreign and commonwealth affairs, which wrongly caused him to delay the claim or application and that act or omission was the dominant cause of the delay.”

19.	The significance of the new paragraphs 1(6A) and 10(a) is that they considerably widened the scope for backdating awards where there had been errors on the part of the Secretary of State.  The term “administrative error” in paragraph 10(a) as in force from 1997 to 2001 had been very narrow.  The new schedule, as amended, appears largely to have codified the policy that the Secretary of State had applied when exercising his discretion under the old schedule.  However, it is to be noted that paragraph 5 of the new version of the schedule permitted backdating for a maximum period of three years in cases to which that paragraph applies.

20.	There does not appear to have been any express requirement for a claim until the Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Amendment (No.3) Order 1996 (S.I. 1996/2882) substituted a new article 3 in the 1983 Service Pensions Order to that effect from 20 December 1996.  However, that was made subject to a new article 3B, also inserted by the 1996 Amendment Order, which provided that a claim was not required where, inter alia, the former member of the armed forces had been discharged on medical grounds.  Before that, paragraph 1(a)(i) of Schedule 3 could have been taken to have implied that being invalided out of the services extended the time for claiming to six months but in fact, even then, those invalided out were automatically referred to a medical board for assessment so that a claim was either taken as having been made or was more-or-less automatically made as part of the discharge process.  The old form of Schedule 3 and the new article 3B appear to have sat unhappily alongside each other for some three months until the 1997 Order made appropriate provision in paragraph 1(7) of the new Schedule 3. 

21.	Article 67(1) of the 1983 Service Pensions Order provided a very wide power to review certain types of decision.

“(1)	…, any decision accepting or rejecting a claim for pension or any assessment of the degree of disablement of a member of the armed forces or any final decision that there is no disablement or that the disablement has come to an end may be reviewed by the Secretary of State on any ground.”

Article 67(2) provided a more limited power to review awards.

“	…, any award under this order may be reviewed by the Secretary of State at any time if the Secretary of State is satisfied that –
    (a)	the award was made in consequence of ignorance of, or a mistake as to, a material fact, or a mistake as to the law;
    (b)	there has been any relevant change of circumstances since the award was made;
    (c)	the award was based on a decision or assessment to which paragraph (1) of this article applies, and that decision or assessment has been revised.”

If a decision is reviewed, it might then be revised under article 67(5), which provided – 

	“…, on a review under this article the Secretary of State may maintain, or continue, vary or cancel the decision, assessment or award and any revised decision, assessment or award shall be such as may be appropriate having regard to the provisions of this Order.”

22.	The principle that it is generally in the interests of justice for there to be finality was upheld because Schedule 3 applied to an application for review as much as to a new claim.  If any review was to be effective in respect of a period before the original date of claim, as would always be the case where backdating of the first award was in issue, the claimant had to show that there were grounds for backdating not only up to the date of the claim but also up to the date of the application for review.  Unlike in ordinary social security law, no specific provision was made for reviewing a review decision.  Some review decisions would have fallen within article 67(1) but a decision to review but not revise an award would not fall within either paragraph (1) or paragraph (2) of article 67.  Instead, it appears that repeated applications for review could be made.  However, with each review decision, it became less likely that the conditions for backdating under Schedule 3 would be satisfied so as to enable any revised award to have effect from a date before the date of the last application for review (see paragraph 1(2)(c) of Schedule 3).

Procedural issues

23.	It seems to me that the first issue that arises in this case is the nature of the decision of 12 September 2002 that was under appeal to the tribunal.  This was not addressed in any of the documents before the tribunal and was not considered by the tribunal but it is of fundamental importance both because any question of backdating has to start with identification of the relevant date of claim, date of application for review or date of decision to carry out a review and because the law has been changing and it is important to identify which version is applicable.  If the decision of 12 September 2002 determined either a claim or an application for review, it is important to identify the date of claim, the date of the application for review or the date it was decided to carry out a review, as the case may be, and consider the implications of the law as in force at that date.  If the decision was a review or a refusal to review an earlier decision, it is important to identify the date of the earlier decision, because consideration will also have to be given to the law as it was in force at that date.  If the decision was a refusal to review an earlier decision, a jurisdictional issue arises because the Secretary of State has contended that there is no right of appeal against a refusal to review.

24.	Such issues cannot simply be overlooked.  In his first submission in this appeal, the Secretary of State submitted that the jurisdictional issue could not arise in this case simply because, through the wording of the decision, the claimant was “given” a right of appeal and, as the point was not argued before the tribunal, the tribunal was not required to deal with it by virtue of section 5B(a) of the Pensions Appeal Tribunals Act 1943.  That submission was misconceived.  Section 5B(a) cannot enable a tribunal to have jurisdiction conferred upon it through the consent or oversight of the parties.  Equally, the fact that the parties have both approached a case on wholly the wrong basis legal basis cannot have the effect of relieving a tribunal from the responsibility of approaching the case on the correct legal basis.  

25.	It is now common ground between the parties that the 2002 decision was a review decision, reviewing the awards made on 17 October 1994 (insofar as it had not already been revised by the decision of 20 February 1995) and on 20 February 1995.  I agree.  Unlike in ordinary social security law, where, under the Social Security (Claims and Payments) Regulations 1987 (S.I. 1987/1968, as amended) and the Social Security Act 1998, backdating arises in the context of the effective date of a claim or supersession, the Service Pensions Order had the effect that backdating arises in connection with the commencement date of an award.  That is why a refusal to backdate was not a rejection of a claim so that there was no right of appeal under section 1 of the Pensions Appeal Tribunals Act 1943 and it was only when the Pensions Appeal Tribunals (Additional Rights of Appeal) Regulations 2001 (S.I. 2001/1031) made decisions under article 65 of, and Schedule 3 to, the Service Pensions Order “specified decisions” that a right of appeal arose under section 5A of the 1943 Act.  For the same reason, reviews of such decisions fall within the scope of article 67(2) rather than article 67(1).

26.	Neither party has suggested what the grounds of review might have been in the present case, but the Secretary of State had obtained additional evidence for the purpose of making the decision and I am content to accept that the awards were reviewed on the grounds of ignorance of material facts (see article 67(2)(a)) but were not revised.  On that basis, I agree with the Secretary of State that the jurisdictional question whether there was a right of appeal against a refusal to review does not arise in this case.

27.	There is a dispute between the parties as to the date of the application for review or the date of the Secretary of State’s decision to carry out a review.  The Secretary of State submits that the review was conducted in response to the Member of Parliament’s letter of 18 April 2001, and that the decision being reviewed was “the commencement date of both the original claim and the deterioration review dated 4 November 1994”.  He submits that a decision on the question of backdating had probably already been issued following the letter of the Royal British Legion dated 13 June 2006, so that the review carried out in 2002 was the second review of the awards.  It is argued for the claimant that no decision was issued after the letter of 13 June 1996 and that the decision of 12 September 2002 followed an application for review made no later than 13 June 1996.

28.	Although this dispute is not important to the outcome of this case given my view of the overall merits, it would be extremely important in another case for reasons I will explain below.  First, I will explain why I prefer the claimant’s approach to the present case on the evidence available.  On 21 April 2001, the Minister clearly understood that the letter from the Royal British Legion dated 13 June 1996 had been overlooked and that no decision had been issued following it.  The Secretary of State now suggests that it is unlikely that the letter from the Royal British Legion was overlooked.  It is said that the letter has the representative’s telephone number written on it by a member of the War Pensions Agency’s staff, which suggests that a response would have been given by telephone and that, if the Royal British Legion had not received a response, they would have followed the query up.  Apart from the fact that the handwritten number on the letter is the claimant’s National Insurance number rather than a telephone number, which appears in the letterhead, there are difficulties with the Secretary of State’s approach.  I am quite prepared to accept that the Royal British Legion probably did receive an immediate response, which may well have been by telephone.  However, a telephone response could not have been a decision and it is unlikely that the response was to the effect that the claimant must write in if he wished backdating to be considered because, on 15 July 1996, Dr Bell was asked to consider whether the claimant’s illness would have prevented him from claiming prior to 20 November 1991.  That suggests that a review was being conducted, whether on the Secretary of State’s own motion in the light of the Royal British Legion’s letter or because that letter was being treated as an application or because the claimant had already made an application, which is what the author of the letter seemed to have understood was the position.  On 7 August 1996, the claimant attended another review medical board, which was presumably in respect of the “deterioration review” mentioned on the document on which the question posed to Dr Bell and his answer were recorded.

29.	I think the parties agree that, as a review had been under active consideration and the claimant had presumably been aware of it through the Royal British Legion, a proper written decision should have been issued, which, if the decision was unfavourable to the claimant, should have been a decision either refusing to review the previous awards so far as the commencement dates were concerned or else reviewing them but not revising them.  despite the invention of the computer, the War Pensions Agency’s record keeping was such that one must often infer the existence of decisions from the surrounding documents on the basis that it is to be presumed that decisions that ought to have been given were given.  However, in this case, I am not minded to draw that inference.  It is  the Secretary of State who ought to be able to produce a record of a decision if one was made and to whose advantage it would be to be able to do so.  It seems quite possible that a decision was given on the “deterioration review” of the decision of 20 February 1995 but not on the review of the commencement dates of that award and the earlier one.  This could have been due to an oversight or because there had not been anything the Secretary of State had recognised as a separate application for review.  I am therefore satisfied, on the balance of probabilities, that the Minister was right and that the decision of 12 September 2002 was the culmination of a process that had started some six years earlier.  

30.	The first reason why this is potentially important is that it has a bearing on whether any of the provisions of Schedule 3 to the Service Pensions Order would have permitted a review decision given in 2002 to take effect before the date of the application for review or the decision to carry out he review.  As I have already observed, any case concerned with the commencement date of the award being reviewed necessarily raises that question.  It is obvious that there will be cases where a person is able to show that he was unable to make a claim due to a medical condition or an act or omission on the part of the Secretary of State but will be unable to rely on that ground in respect of a later period up to the moment of applying for a review of the award made following a claim.

31.	This issue seems in the past to have been ignored by the Secretary of State, which may be why review decisions do not mention that they are review decisions.  I am told that before Schedule 3 was substituted in 1997, the Secretary of State did not investigate whether there were grounds for exercising his discretion to award a disablement pension from a date before the date of claim unless the claimant had both raised the issue and provided substantial evidence to support backdating.  In consequence, a claimant did not know that an award would not be backdated until he received notice that it had been made.  If he then raised the issue, it appears to have been treated as an entirely fresh issue rather than a review.  This approach appears to have been continued after the changes made in 1997.  It is not clear to what extent the statutory changes were really noticed by those working in the War Pensions Agency.  It is interesting that the Minister’s letter of 21 April 2001 is written in the present tense in terms that reflect the old version of Schedule 3 rather than the new one that had been in force for four years.  

32.	It is arguable that the Secretary of State’s approach was a legitimate one under the old legislation on the basis that he was not obliged to consider exercising his discretion in any case where he was not asked to do so and any unfairness that would otherwise have arisen from a claimant not being put on notice of the need to make the request before a decision was given was avoided by the Secretary of State exercising his discretion on the application for review if the claimant could show a good reason for the delay in making the claim whether or not he also had good reason for the delay in applying for a review.  However, I have very serious doubts about the legitimacy of continuing the same approach under the new legislation.  As the claimant’s representative pointed out in the grounds of appeal to the tribunal, under the new version, a claimant had a right to have an award backdated if the statutory criteria were satisfied; he no longer had to rely on the exercise of a discretion.  In ordinary social security law, the leading case is the decision of a Tribunal of Commissioners in R(SB) 9/84, who held that backdating needed to be considered only if it was raised by the claimant.  However, reliance was placed on the particular statutory provisions in issue (see paragraph 11) and there may still be scope for the approach taken in R(SB) 56/83 – that a simple claim is usually to be taken as a claim to all benefit to which the claimant might be entitled, whether in the past or in the future – when different legislation is being considered.  The fact that backdating arose in the context of an award rather than a claim is one reason why the approach taken in R(SB) 56/83 may have been more appropriate in cases under the Service Pensions Order.  It is also relevant that adjudication under the Service Pension Order was considerably slower than in most ordinary social security cases and the limitation on the backdating of review decisions once the general discretion was removed was therefore of considerable significance.  It was no use a claimant being able to show that one of the conditions for backdating was applicable before the date of claim if he was not made aware of the need to raise it until after an award was made and he was then unable to show that one of the conditions for backdating was applicable in respect of his application for review.  If the Secretary of State was not actually required to ask questions for the purpose of discovering whether the claimant satisfied the conditions for having an initial award backdated to a date before the date of claim (see Kerr v. Department for Social Development [2004] UKHL 23; [2004] 1 W.L.R. 1372 (also reported as R1/04(SF)), he was at least obliged to give claimants sufficient information so that they knew both that the issue had to be raised before the initial award was made and what the relevant considerations were..

33.	However, the legislation enabled justice to be done.  A failure to investigate whether backdating might be appropriate coupled with a failure to provide the claimant with sufficiently detailed information to enable him to realise he must raise it himself with appropriate evidence amounted to an error or omission falling within paragraph 10 of the new version of Schedule 3 from 1997 and also paragraph 1(6A) from 2001.  Thus, the claimant was not prejudiced by being obliged to apply for a review and the overall effect was much as it was under the old law.  On the other hand, that was likely to work only for a first application for review.  Once a claimant had shown he was capable of applying for a review, it would be more difficult to satisfy the criteria on a subsequent application.  That is the first reason why it was important whether the decision of 12 September 2002 was the first or the second review decision.

34.	The second reason is that the law changed in 1997.  There is a general presumption against retrospectivity, both at common law and by virtue of section 16 of the Interpretation Act 1978, and, although the way the presumption works in relation to procedural matters depends very much on the factual context (see Yew Bon Tew v. Kenderaan Bas Mara [1983] 1 A.C. 553), I accept Mr Stagg’s submission that an application for review made before a change in the law usually falls to be determined under the law as it was in force at the time of the application for review if that would be more beneficial to the applicant.  If a review decision had been issued in 1996 or 1997 in the present case, the 2002 decision would have been made on an application for review, or a decision to conduct a review, made after the new version of the legislation was introduced.  As it is, the process had started under the old version of the legislation.

35.	The final procedural point is that a review of an initial award involves consideration of whether the decision being reviewed was correct under the law in force at the time of the claim.  Thus, even if the application for review in this case had been made in 2001 and the question whether an award could be made in respect of the period before the application for review would have fallen to be determined under the final version of Schedule 3 to the Service Pensions Order, the question whether the award should be made effective before the original date of claim would still have fallen to be determined under the law in force in 1991. 

Procedural errors in the tribunal’s decision

36.	It will be clear from what I have said that the tribunal erred in not determining whether the decision under appeal was a review decision or whether there had been a previous review decision.  It also erred in not considering the law as it was in force in 1991 when considering whether the award should have taken effect before the date of claim.

37.	On the other hand, these errors are not necessarily fatal to the tribunal’s decision.  I have found that the decision under appeal was a review decision but that it was a first review decision as far as the commencement date was concerned.  It is clear that the Secretary of State did not investigate the question of backdating either of the awards before they were made and did not enable the claimant to raise the issue then and so, for the reasons I have given, the claimant may have had good grounds for not raising the issue of backdating earlier than he did.  Although there is no record of him having written in about that issue in 1995, the letter from the Royal British Legion implies that he understood that the issue had been raised on his behalf by the Royal British Legion before the letter was written and I would be inclined to accept that a request for a review was made reasonably promptly after the claimant had been notified of the second award.  On that basis the remaining question is whether there were grounds for backdating either of the awards.  Insofar as that was addressed by the tribunal, it relied on the new version of the legislation but that is not fatal unless the discretion under the earlier legislation should have been exercised to achieve a different result in the light of the tribunal’s findings of fact or unless the findings themselves are flawed.

The tribunal’s decision on the merits

38.	The appeal to the tribunal was originally based on paragraph 5 of the new version of Schedule 3.  However, the tribunal accepted the Secretary of State’s submission that manic depressive psychosis was, by its nature, variable and that, although there were substantial periods between the date of the claimant’s discharge and the date of his claim when he would have been incapable of claiming, there were also periods when he could have claimed.  Mr Stagg points out that paragraph 5 only permits backdating for a maximum period of three years and submits that it is irrelevant that the claimant may have been capable of making a claim for periods before then.  That is plainly correct, unless the claimant’s ability to make a claim in earlier periods tended to show that he was also incapable of doing so during the relevant period.  However, I do not agree with his submission that the tribunal regarded his ability to work while in the United States and shortly after he returned to the United Kingdom as being by themselves fatal to his claim.  The tribunal also referred to him working in 1988 and to a psychologist’s report dated 5 June 1989 in which the claimant was said (presumably in an earlier session) to be planning to get married in May 1989 and was looking forward to the event.  I agree with Mr Stagg that a person is “incapable of making a claim” for the purposes of the legislation if, by reason of the effects of the injury or illness on his life, he cannot reasonably be expected to make a claim.  However, there is nothing to suggest that the tribunal applied the wrong test.  Even during the last three years before the date of claim, when the claimant was an out-patient at the Maudsley Hospital (and for brief periods in 1988 an in-patient), the tribunal was entitled to take the view that he could have made a claim.  I would not apply a materially different test exercising the broad discretion under the previous version of the legislation (save perhaps as to the maximum period of backdating) and I do not consider that I should take a different view from the tribunal’s.  I observe that the claimant had instructed a solicitor and was contemplating a claim for damages against the Maudsley Hospital in June 1989, which is not entirely consistent with being incapable of claiming a disablement pension.  There is no evidence that he was particularly ill between then and the date of claim in 1991.

39.	The main submission made to the tribunal by Ms O’Neill was under paragraph 10 of the new version of Schedule 3.  She argued that had the military authorities arranged appropriate assessments of the claimant’s mental health he would have been invalided out of the Army instead of being discharged for misconduct and so would not have needed to make a claim for a disablement pension.  The tribunal rejected that submission, taking the view that it was unlikely that the military medical authorities would have diagnosed a serious psychiatric condition at the time and that even if the claimant had been downgraded, it would not have followed that he would have been medically discharged when he was in any event due to be discharged shortly for misconduct.  Ms O’Neill’s grounds of appeal against the tribunal’s decision suggest that the decision was perverse.  However, in his skeleton argument and oral submissions, Mr Stagg resiled from this reliance on paragraph 10, recognising that, at least on a literal construction, that paragraph applied only if an omission led to a delay in claiming and continued to do so up to the actual date of claim and that it did not apply if the omission merely leads to a loss of an opportunity to avoid having to claim at all.

40.	I consider that Mr Stagg’s diffidence was well merited.  The scope of paragraph 10 is not as wide as Ms O’Neill had suggested.  Moreover, the new paragraph 1(6A) depends on a decision made under the Service Pensions Order having been vitiated by official error and any error in not referring the claimant to a medical board did not have the effect of vitiating any such decision.  However, of course, Mr Stagg had also correctly submitted that my hands were not tied by the terms of paragraph 10 because I could exercise the general discretion under the old form of Schedule 3.  Had the claimant been unable to claim by reason of his mental illness, I would certainly have been inclined to rely on the failure to refer him to a medical board as a reason for backdating the claim to the date of discharge rather than for the limited period of three years permitted by the new paragraph 5.  As it is, I am not persuaded that the error made in not referring the claimant to a medical board is an adequate reason for backdating the claim in this case.

41.	It would be different if the failure to take appropriate action before the claimant was discharged had led to the claimant himself not realising that he was suffering from an illness aggravated by service.  However, it is plain from the claimant’s own accounts that he recognised that he was unwell and that that is why he approached the Priory straightaway.  Moreover, the timing naturally raised the question whether his service had caused or aggravated his illness and he himself has accepted that he appreciated the link.  It has not been part of his case that he was not given the usual information about disablement pensions.  I am satisfied that, on the tribunal’s findings, it was not appropriate to make an award before the date of claim in this case.  I see no reason to go behind the tribunal’s finding of fact and I accept Mr Auburn’s submission that the tribunal actually dealt with both approaches to paragraph 10.

42.	Finally, it may be observed that, although the parties agree that both the awards made on 17 October 1994 and 20 February 1995 were in issue, the decision under appeal to the tribunal referred only to the awards made on 20 February 1995 and the tribunal appears to have considered only the question whether the award made on 17 October 1994 should have commenced on a date earlier than it did.  Obviously the same reasoning is relevant when considering whether the award made on 20 February 1995 should have been commenced before the date of claim.  That, however, does not deal with the question whether the assessment of 50% should have been applied from the date of claim on 20 November 1991 rather than the date of the application for review on 4 November 1994.  However, the problem facing the claimant in respect of that period is not so much whether the criteria of Schedule 3 might have applied to it as whether there were grounds of review under article 67(2) that could have justified revising the earlier award from a date between 20 November 1991 and 4 November 1994 even if any of the criteria under Schedule 3 were satisfied.  There is simply no evidence that the award of 17 October 1994 was based on a mistake of fact or of law insofar as it was based on the assessment of disablement or that there was any change of circumstances between 17 October 1994 and 4 November 1994.  The explanation for two different assessments being made so close together may be that the first assessment was based on an average level of disablement over the previous three years whereas the second was based on a current assessment.  It might have been more appropriate had the first award had a stepped assessment, i.e., 30% for the past period and then 50% for the present and future, but that was effectively achieved by commencing the new award from 4 November 1994.  Accordingly, although the tribunal erred in failing to address this issue, I am not satisfied that there are grounds for making a decision that is any different from the tribunal’s in practice.

	(signed on the original)	MARK ROWLAND
		Commissioner
		5 February 2008