Forum Home → Discussion → Income support, JSA and tax credits → Thread
Recovery of overpayment from partner?
Client claimed IB and IS with partner included on the claim in 2005. He failed to declare a service pension and an overpayment of £17000 came to light recently. He appealed the recoverability but died before the hearing. His daughter continued with the appeal but it was lost last week. The client died intestate and the daughter acted as personal representative without needing letters of administration because the estate was minimal, eg half of joint bank acount etc. She paid creditors what she could then other debts inc student loan (he had been a mature student) and credit card balances were written off. The house was owned by the client and his wife as joint tenants. His widow, who has severe mental health problems, is worried that the DWP will now come after her for the overpayment. I have it in my mind that the DWP can only recover from a claimant’s partner if the overpayment arose while they were a couple, and if they still are a couple during the repayment period. Obviously this is no longer the case once the clamant is dead. Is this right? If so I will ask the DWP to write off the overpayment. Thanks, Brian
Re my original post, I have found para 4.340 of the HB/CTB Overpayments Guide which refers to reg 102(1ZA)/(SPC) 83(1ZA) which aparently requires that the claimant and partner were a couple both when the overpayment occured and when it is being recovered for the partner to be liable. Trouble is I don’t know what this reference refers to so I can’t find, I’m not sure if it only applies to HB/CTB, and I don’t know if it only refers to recovery by deduction from the parner’s benefits. Any ideas?
You may need to look at bankruptcy law. I know that in some circumstances it is possible for the estate of a deceased person to be made bankrupt by a creditor (& this can be done up to 5 years after the death). Assuming the house had equity then it might be arguable that his interest in it meant it was an asset of his estate. However, as it was owned as joint tenants & his interest therefore went to his widow by survivorship I suspect it would not be included in his estate but I am not sure about this. If the widow or personal representative gets any approach which looks as if it could lead to a bankruptcy they will need specialist advice asap - either from an Insolvency Practitioner or a solicitor specialising in Insolvency Law.
Client claimed IB and IS with partner included on the claim in 2005. He failed to declare a service pension and an overpayment of £17000 came to light recently. He appealed the recoverability but died before the hearing. His daughter continued with the appeal but it was lost last week. The client died intestate and the daughter acted as personal representative without needing letters of administration because the estate was minimal, eg half of joint bank acount etc. She paid creditors what she could then other debts inc student loan (he had been a mature student) and credit card balances were written off. The house was owned by the client and his wife as joint tenants. His widow, who has severe mental health problems, is worried that the DWP will now come after her for the overpayment. I have it in my mind that the DWP can only recover from a claimant’s partner if the overpayment arose while they were a couple, and if they still are a couple during the repayment period. Obviously this is no longer the case once the clamant is dead. Is this right? If so I will ask the DWP to write off the overpayment. Thanks, Brian
I had a similar situation; the claim for recovery isn’t against the partner per se but a claim against the estate of the individual. That being the case they should go after the daughter who acted as Personal Representative rather than your client. This assumes that your client wasn’t also nominated as PR; they like to have two…
The Non Contentious Probate Rules will be of help in advising whether they can bring a claim against an insolvent estate; I doubt it but that’s speculation on my part.
If she advertised the death in the London Gazette that time limits debts being brought against the estate, to 5 weeks IIRC but it was a while back now. Have a shuftie at the 1925 Administration of Estates Act; most of it’s still extant.
The ghost of Ariadne has just washed past; thanks for your help if you’re still watching.
Just to warn you that the Recovery From Estates team were a particularly obtuse bunch; very unpleasant to deal with.
[ Edited: 4 Apr 2014 at 01:59 pm by Dan_Manville ]1. See my post yesterday. I have now checked the Insolvency Service Technical Manual:
http://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch49-60/Chapter 54/Part4/Part 4.htm#54.64
Go to paras. 54.64, 67 & 68. It would be possible for the estate to be made bankrupt (in effect this is a claim against an insolvent estate) & the deceased’s interest in the home (assuming there is equity) to be taken for the creditors.
2. I agree with DM about Recovery from Estates team. A friend had a nightmare of a time with them.
1. See my post yesterday. I have now checked the Insolvency Service Technical Manual:
http://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch49-60/Chapter 54/Part4/Part 4.htm#54.64
Go to paras. 54.64, 67 & 68. It would be possible for the estate to be made bankrupt (in effect this is a claim against an insolvent estate) & the deceased’s interest in the home (assuming there is equity) to be taken for the creditors.
2. I agree with DM about Recovery from Estates team. A friend had a nightmare of a time with them.
That link’s broken. Any chance of another try? If I try to go to the top level domain I get redirected to bis.gov.uk
From what I can recollect if the estate’s distributed already then a Personal Representative can be held personally liable. Also, it’s an offence to distribute an estate while there are still outstanding creditors so a signpost to a Wills & Trusts solicitor might be in order if RFE get arsy.
When I dealt with them I managed to get the o/p overturned so they drifted into the sunset
Try this one:
http://www.insolvencydirect.bis.gov.uk/technicalmanual/default.htm
Scroll down to Ch 54, click & go from there. Hope it works!
I think you’re right - Personal Rep. can be held liable in some circs. - but not if the London Gazette thing you mentioned has been done.
A personal representative for the purpose of the Administration of Estates Act 1925 is a person “granted” the letters of administration. The advertising rule protects personal representatives from being sued by creditors arriving late. I don’t think that a person acting informally is therefore liable under the terms of the Act. They might be vulnerable to an action at common law. However, that is really immaterial as creditors can recover from the estate and any beneficiaries under s32 of the Act (at least I think that’s what s32 says). I’ve never heard of the non advertising, etc, etc, being a criminal offence. It just carries a civil liability. I’d take Derek’s advice and see a solicitor.