Firstly, apologies this is so long and complex. I have a client on DLA -HRM and,I thought initially, LRC - both indefinite awards. He has chronic backpain, angina, acute anxiety, depression and suicidal thoughts. When I recently came to help him draw up a financial statement and checked the breakdown of his benefits into his bank account, it appeared he was actually receiving DLA/MRC,including the SDP on his IS entitlement. His payment also included SDA.
My client confirmed he had been getting MRC until his DLA renewal claim in Dec 02 when the award was reduced to LRC. Confused, I then asked DLA to send him a copy of his award letter which clearly states LRC was awarded indefinitely from Dec 02. It seems that DLA Blackpool failed to notify the local benefits agency of the change in his entitlemnet in 2002 and he has continued to receive the incorrect rate of DLA since then (plus the SDP)-a very large overpayment of each. I feel fairly certain I can argue an official error, the onus in this case surely being on DLA Blackpool to notify the local office of the change (is that right?)
My client genuinely believed his money had been adjusted and as he gets the DLA, IS and SDA as one fortnightly lump payment into his bank it seems unreasonable (given his own anxiety/mental health problems)that he could have been expected to know how the payment into his bank was broken down and that it might be incorrect.
So I am wondering how best we approach this now that I have (unfortunately) discovered the problem.My client's mental health remains extremely fragile (his financial situation being the main source of this anxiety)and the irony is that I feel he should in any case be receiving MRC.He has reluctantly agreed we need to contact DLA but his fear(and mine)is that the DLA will simply be stopped (or reduced to LRC)along with the removal of the SDP (a sudden drop of around £70 pw in his income). Furthermore, he is in the process of joining the motabilty scheme and is already extremely anxious about the loss of his DLA/HRM as a result. I am concerned about the impact that a sudden drop in income will have upon his mental well-being as my initial involvement was to help him with debt issues.
Should we pre-empt things by submitting a supersession request (hoping for MRC) along with a covering letter explaining our "confusion " about his current award/payment. My concern is that they would still stop the MRC award for 3 months whilst they considered the supersession. I cannot give my client any assurances that his DLA will not stop whilst the matter is being investigated even though I'm doing my best to reassure him that if it does stop we will endeavour to get the MRC award reinstated. Where do I start with this mess? Specifically,

1.) Do we have a convincing case for official error re: the overpayment?
2.) How best do we raise this matter with DLA Blackpool and will they automtically reduce the care award once we alert them to their error, even if we submit a supersession claim at the same time arguing for MRC(could they fast-track a supersession for instance in the circumstances?)
3.) How best can I minimise the impact on my client's financial situation and mental well-being in handling this issue?

Any suggestions very gratefully received.

Dolores:

1) Unfortunately following the Court of Appeal decision in Hinchy

http://www.rightsnet.org.uk/cgi-bin/sub_client/search.cgi?template2=news/user_details2.htm&output_number=1&news.ID=720103216477

it will be very difficult to argue official error.

2) You could ask Blackpool to fast track the supersession, but I'm sure you know how hit and miss it can be getting Blackpool to do anything. The only way I could think of to minimise the impact would be to get all the supporting evidence, doctors letters etc together before you ask for the supersession in the hope that this speeds things up.

3) I can't see any way to minimise the impact on your client's income through the benefits system. A complaint to the parliamentary ombudsman about the maladministation which resulted in the overpayment might get him some compensation. A charity might be prepared to pay him an allowance to cushion the effects of the income drop whilst the supersession is considered.

As far as his mental well being is concerned, you have to balance the stress of lving through a supersession and the trauma of sorting out the overpayment with your support against the only alternative which is the prospect of living the rest of his life with the knowledge that he has the skeleton of a continuing and ever increasing overpayment threatening to pop its head out of the cupboard any time.

sorry, getting my cases thoroughly mixed up, the link I posted was to the CA decision in B vs Secetary of State for Work and Pensions. The related HOUSE OF LORDS decision in Hinchy is at:

http://www.rightsnet.org.uk/cgi-bin/forwardsql/search.cgi?template2=user_details2.htm&output_number=1&sort=news.submission_date+desc&news.ID=3395811148

and is also bad news!

Teach me to be posting on this board first thing on saturday morning instead of going out and getting a life, still the gym opens in an hour's time...

I feel you should challenge over payment despite Hinchey. Remember Hinchey says you cannot second guess what systems etc the SoS has in place, but we know for a fact DLA have direct contact mechanisms in place with local offices. Especially if the local office was paying the dla at the time - you need to check this.This arguement was put to me by a very experienced Chair who confirmed it had been raised in a journal most Chairs read if you can show a direct link between the offices then you can build an arguement that the Sos already knew the facts, so o/p not recoverable. I havent had a case yet where I can forward this arguement yet so good luck.

Agree with the previous post, do not be put off by Hinchy case there are still arguments that you could use and challenge the decision..
Pls. see below (In particular the 185 which is a must for op recovery cases)
http://www.cpag.org.uk/cro/wrb/wrb185/Overpayments.htm
http://www.cpag.org.uk/cro/wrb/wrb187/strictly_liable.htm

Good luck. PM

DLA/AA do have a system in place for notifying local offices of an award - and change of award - it can be found in their Team members guide - chapter 19, paras 72/73 .....although it has the usual form number, it's more commonly known as the Orange card.


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When you have finalised payment
Notifying another benefit area of an award/change of award:-

72 Other benefit areas can issue, where appropriate, an extra amount/ disability premium when a customer is in receipt of AA or DLA middle/highest rate care component.

73 When an award/change of award is processed on DLACS/AACS, the system automatically notifies Retirement Pension (RP), Severe Disablement Allowance (SDA), Incapacity Benefit (IB) and tax credits on report FDA/FAA40105 (orange card). This shows the customer's details and the award of DLA/AA that has been made.

74 System transaction TDA/TAA24201 will be issued to Income Support/Jobseekers Allowance and Pension Credit.

75 The DLACS/AACS is unable to provide this information automatically to Inland Revenue (IR) or a customer's partner. In these circumstances you will need to issue a form DBD70 to the Tax Credit Office (TCO) to inform them of the customer's award/change of award.

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To ground recovery the overpayment must be "in consequence of the misrepresentation or failure to disclose". Thus although there is no defence if the internal admin arrangements between departments break down (HoL - Hinchy) if it can be shown that the relevant office did in fact have knowledge of the material fact in question then the overpayment may not be in consequence of the failure to disclose. That question was left unanswered by the HoL in Hinchy.

Many thanks indeed to you all for your expert advice(especially on Saturday morning...) I'm new to the website and still finding my way around it but what a fantastic resource to have at you finger tips. Many thanks again. Dolores

I can't see why there would be a recoverable o/p of DLA at all. Your client has not misrepresented or failed to disclose a material fact to DLA. He made a renewal claim, was awarded LRC but they paid him the wrong amount. The o/p of DLA is clearly official error and I cannot see how they could bring it within S71.

The o/p of SDP may well be recoverable, since he doesn't seem to have notified the local office that his DLA award had changed. On the other hand if the DLA is paid with his IS he may be able to argue that Hinchy shouldn't apply, because he knew that there were effective liaison arrangements between DBU and the local office since those arrangements were being used to pay him. Despite Hinchy it seems to me it is difficult for the Sof S to argue that a client has to disclose changes in an award to the office that is apparently paying him under that award.

The problem seems to me to revolve around causation as far as I can tell. Hinchy does take away the need for the DWP to show causation and I think that the best tack would be to argue that it was the muck up between Blackpool and Income Support that actually caused the overpayment. The failure to diclose, without going into whether a duty arose under REG 32 or otherwise, only operated to not prevent the overpayment from occurring once it had already been caused by the DWP.

Now that you client knows that there has been an overpayment they will risk prosecution if they fail to alert the relevant office. ALerting the benefit offices should also help them in arguing for the discretion to be exercised not to recover the overpayment.

I do not agree that Hinchy does away with the need for the DWP to show causation. As I posted above the language of section 71 has not changed and the overpayment must arise as "a consequence of the misrepresentation or failure to disclose". That is esentially a question of fact which must be explored, particularly if put into dispute.

If the Department had knowledge of the relevant material fact then they must explain why they failed to act on it and whether there was a causal link between that failure and the overpayment.

i agree. Hinchy is about reporting changes, not causation. as keith said, there is no recoverable overpayment of DLA. The DWP has has given a decision changing the award, and there has somehow been a failure to implement the decision - that is an official error.

the IS position is more complicated, because DLA payments were combined with IS. was a mistake made by the DLA office or the local office? mike shermer mentioned the orange card system, by which information is communicated from the DLA office to local offices, on all DLA claimants receiving IS, whether combined payment cases or not. it's fallibilities have been taken into account in the Hinchy decision, as we know. but in combined payment cases, the authorisation of combined payments is a more significant document.

it has now been some years since i worked in a local office, so i am not up to date on any changes in the system, but this was it... the 'authorisation of payment' forms were audit documents, with a little red audit stamp on them, therefore, as audit documents, should not be weeded or destroyed. they were sent from the central office to the local office in sealed pouches with serial numbers, records of which were kept in post opening records.

on changing the award, the DLA office should have sent a revised payment authorisation form to the local office. unless the DLA office confirm that they failed to issue the form, (an official error) the LO cannot say they have no trace of it. if the LO received it and lost it, that also is an official error.

i can see that the DWP might invoke Hinchy type arguments on the o/p of SDP, but they may well strain reasonableness in view of the fact that payments were combined, and the role of official error in continued payments.

i think you must notify them straightaway that there appears to be an overpayment, and concentrate on the reasons why your client didn't notice that his money hadn't gone down as he could have expected. you neever know, they may surprise you.

jj