With and without foundation – Bedroom tax in Supreme Court

MA & Ors, R (on the application of) v The Secretary of State for Work and Pensions [2016] UKSC 58
R (on the application of Carmichael and Rourke) (formerly known as MA and others) (Appellants) v Secretary of State for Work and Pensions (Respondent)
R (on the application of Daly and others) (formerly known as MA and others) (Appellants) v Secretary of State for Work and Pensions (Respondent)
R (on the application of A) (Respondent/Cross-Appellant) v Secretary of State for Work and Pensions (Appellant/Cross-Respondent)
R (on the application of Rutherford and another) (Respondents) v Secretary of State for Work and Pensions (Appellant)

The Supreme Court has handed down its judgment in the culmination of years of cases on the discriminatory impact of the ‘removal of the spare room subsidy’ – the bedroom tax. The outcome was mixed, even including a split judgment on one case, but in at least one respect, the bedroom tax regulations were held to unlawfully and unjustifiably discriminate against households with disabled members.

The lead judgment of Lord Toulson makes clear that the accepted test was whether the relevant parts of regulation B13 were ‘manifestly without reasonable foundation’, dismissing an argument from the MA appellants that ‘weighty reasons’ were required in disability discrimination cases, particularly as the overall policy of Reg B13 was not being attacked. Stec applied  and Humphreys v Revenue and Customs Comrs [2012] 1 WLR 1545 approved.

In the Rutherford and Carmichael appeals, the Supreme Court held that where there is a clear medical need for an ‘extra’ room, it is not enough that discretionary housing payments may be awarded and this is a sufficiently clear class of case that the regulations should have made an exemption.

In both the Rutherford case – a child needing an overnight carer – and the Carmichael case – partners unable to share a room due to disability – the court pointed out the ‘inexplicable inconsistency’ in the Secretary of State’s different treatment of adults and children needing separate rooms or overnight carers. The Secretary of State’s appeal of Rutherford was dismissed and the Carmichael’s appeal allowed. Our note on Rutherford in the Court of Appeal is here

The other MA cases raising disability discrimination were not successful. There was no direct medical need for the ‘extra’ room, rather what the court called a ‘social need’ which was related to a disability in various different ways. The Supreme Court found that these could not be considered as a class and each case needed individual consideration of the circumstances and the merits of the social need. As such, the use of the DHP system to address the wider rage of disability related reasons for needing, or wanting the ‘extra’ room was justified. The details of the other MA cases on appeal are:

51. Mr Daly occupies a two-bedroom property. His severely disabled son, Rian, stays with him regularly, but he is not within the list of those who qualify for a bedroom under Reg B13(5) because he spends less than half his time with his father. This has nothing to do with the fact of his disability. Mr Daly may have a powerful case for a DHP award, so that he can continue to pay his rent from state benefits for Rian’s sake, but I accept the Secretary of State’s argument that he has no proper basis for challenging the HB and DHP structure on equality grounds.

52. Mr Drage is the sole occupier of a three-bedroom flat, which is full of accumulated papers. He suffers from an obsessive compulsive disorder. His hoarding of papers is no doubt connected to his mental illness, but that is very far from showing that he has a need for three bedrooms. It is not unreasonable for his claim for benefit to cover his full rent to be considered on an individual basis under the DHP scheme.

53. JD lives with his adult daughter, AD, who is severely disabled, in a specially constructed three-bedroom property. They have no objective need for that number of bedrooms. Because the property has been specially designed to meet her complex needs, there may be strong reasons for JD to receive state benefits to cover the full rent, but again it is not unreasonable for that to be considered under the DHP scheme.

54. Richard Rourke and his step-daughter live in a three-bedroom property. One of the bedrooms is used for the storage of equipment. It is another example of a case where it is not unreasonable for Mr Rourke’s claim for benefit sufficient to cover the whole of the rent to be considered on an individual basis under the DHP scheme.

In the case of A, a woman who was raped, suffered domestic violence, harassment and stalking, who was allocated a 3 bed home that was fitted out with safety equipment and panic room under the Sanctuary Scheme, the Supreme Court overturned the Court of Appeal’s finding of discrimination by sex. While confirming that “for as long as A, and others in a similar situation, are in need of the protection of sanctuary scheme housing, they must of course receive it”, the majority of the 7 Judge panel found that this was also a situation that required case by case evaluation, rather than an exemption for a class of people, and as such, use of the DHP scheme was justified. 2 Judges disagreed and would have found sex discrimination. Baroness Hale, with Lord Carnwath, found (at 77)

Indeed, the respondent does not seriously dispute that Ms A needs to stay where she is. The Secretary of State accepts that she needs to stay in a sanctuary scheme and probably in this very house. The justification suggested for the interference, or the discrimination, is the availability of discretionary housing payments to make up the shortfall in her rent. But if the discretionary housing payment scheme is not good enough to justify the discrimination against the Rutherford and Carmichael households, it is not good enough to justify the discrimination against Ms A’s household either. Its deficiencies were acknowledged in the Court of Appeal’s decision in Burnip v Birmingham City Council [2012] EWCA Civ 629[2013] PTSR 117, para 46. They are well-summed up by Mr Drabble QC on behalf of the Rutherford and Carmichael families: it is discretionary, cash-limited and produces less certainty; it has a stricter means test; it offers different and less attractive routes of judicial challenge; it can be onerous to make applications; and it encourages short term, temporary and conditional awards. For a woman in a sanctuary scheme to have to endure all those difficulties and uncertainties on top of the constant fear and anxiety in which she lives cannot be justified. This is not a question of the allocation of scarce public resources: it is rightly acknowledged that public resources will have to meet this need one way or another.

The court of appeal finding of sex discrimination (our note here) was overturned.

Where does that leave us?

The Secretary of State will have to amend the regulations to provide for exemptions for households with disabled people with a (clear) medical need for the room. Amending after the Court of Appeal decision in Burnip took many months and a judicial scolding. It is to be hoped this time will be quicker.

For others with a need for an additional room but not currently exempted, even if the need is disability related, they will continue to have to seek DHPs. As the reduced benefit cap bites, this will become much harder.

A has already stated she will be appealing her case to the European Court of Human rights. But any decision by the ECtHR will be years done the line.

On a personal note, I must congratulate the Carmichaels and the Rutherfords, who I have talked to often over the last few years. Both families have shown remarkable strength and determination in seeing their cases through, in incredibly difficult personal circumstances. Their efforts and those of CPAG and their legal teams should see thousands of people with a clear medical need for a room exempted from the bedroom tax.

About Giles Peaker

Giles Peaker is a solicitor and partner in the Housing and Public Law team at Anthony Gold Solicitors in South London. You can find him on Linkedin and on Twitter. Known as NL round these parts, and still is Nearly Legal on Google +.
Posted in assured-tenancy, Benefits, Housing law - All, secure-tenancy and tagged , , , , , .

25 Comments

  1. If the supreme court decision requires amending regulations to implement its decision, what should local authorties be doing with current housing benefit claims from claimants who have similar circumstances to the Rutherford and Carmichael families ?

  2. Pingback: Rutherford and Others bedroom tax case: hold the celebrations | AL's LAW

  3. All, people in the same situation will have to apply for a DHP. (Funds for that will become harder to get). And also to put in a formal Bedroom Tax appeal. If the DWP drag their heals in applying the legislation and making it law. Surely, they will have to send the cases to tribunal?? The applicants, will be in a sort of ‘LIMBO’ until this is put into legislation. BUT if they delay, putting in their appeal, they could then be out of time. No idea if these cases appear before a Judge. BEFORE it’s put into legislation, WHAT decision they would come to?????

    • Yes, people in similar situations should apply for DHP if not already getting it. There is now a very strong case that they should be awarded.

      I don’t think the Tribunals can do anything about it at all.

  4. Problem being that many disabled people are not being awarded DHP’s and that’s up and down the country. So, what then, they have no choice but to go down the appeal route.
    We have people on our facebook appeal group whose situations are the same and have been refused a DHP. And are therefore paying the BT

    • Given the SC finding, people in a similar position would have a very strong case for a DHP pending a change in the regulations. I can’t see any point in appeals to the FTT, the FTT can’t overturn the express provisions of the regulations.

    • I’ve been corrected by CPAG (and very happy to be shown to be wrong). Their view is that

      “the local authority and the Tribunal are under a duty under s6 HRA to dis-apply the legislation insofar as it discriminates against disabled people who have medical need for an additional room”

      and

      “claimants with a medical need for an extra bedroom should be advised to seek a revision (or supersession?) of their housing benefit award on an error of law and appeal against any refusal to the Tribunal. They probably should also apply for a DHP to cover the gap while they are waiting, but they are entitled to an increase in HB as of right.”

      I’m less certain that this will clearly be the case for anyone not directly in a Rutherford/Carmichael situation, but worth arguing.

  5. What are the implications for the Rutherfords when their granson is (now?) no longer a ‘child’. Does a ‘stayed’ case (like the Oxford case – vested interest) concerning the need for an additional bedroom for an overnight carer for a non-dependent in the household now need to proceed or does the judgement mean there is now no arguable discrimination in such cases?

    • I would guess that will depend on how the regs are amended. The SC judgment clearly directly makes people in the Rutherford/Carmichael position unlawfully discriminated against. But there is also the broader position on cases of ‘clear medical need’ suggested at 42 of the judgment. If the DWP amend to address that broader class of ‘clear medical need’, that may also impact on the ‘relevant person’ definitions. However, given the track record, one might anticipate restrictive amends simply to cover Rutherford/Carmichael situations, in which case, there may indeed be other situations to be appealed.

      I certainly don’t think that this judgment removes the possibility of arguing discrimination in an ‘overnight carer for adult non dependant in the household’ situation. If anything, I would have thought para 42 would strengthen such a case – clear medical need, excluded from the categories of exemption.

  6. Pingback: Bedroom tax case: don’t forget the ECHR | AL's LAW

  7. I’ve had a look on Rightsnet. It’s gobbledy gook to me!! We have a lady on the Appeal group who has a disabled child, that she needs help with overnight care. Her Mum stays overnight to help her. The same as the Rutherfords. She was told yesterday by her LA that the Judgement does not apply to her!! She has been paying the Bedroom Tax, for quite some time.
    We have said apply for a DHP. Meanwhile, she is paying.
    We have advised to put a written appeal to her LA. And send a copy of the Judgement.
    There is clear, discrimination and clear, medical need.
    So, she should be asking for a supersession of her HB award? On an error of law. And appeal against any refusal to the Tribunal. And is entitled to an increase of HB. As, a matter of right??
    Have I got that right??
    Until the DWP inform LA’s. On what they should be doing. There are going to be some people ‘in limbo’.

    • CPAG’s view on such cases is the should seek a revision/supersession of decision on the basis of an error or law (unlawful discrimination contrary to Art 14 by regulations), then go to Tribunal if refused.

      I strongly suspect it will not be straightforward. I anticipate LAs and DWP will fight any cases that are not exactly the same as Rutherford/Carmichael, that there will be very limited amendments to the regulations, and that appeals and higher court appeals on ‘clear medical need’ will still need to go ahead.

      Your case here – it is a family carer, so potentially distinguished from Rutherford (though I agree, same principle should be applied).

      It is also not entirely clear what the Tribunal could do even if minded to uphold the appeal. The option would be to strike down the discriminatory part of the regulations – but which bit exactly, and to what effect? Or just order HB to be paid to avoid unlawful effect?

  8. In answer to Giles at 10.16 this morning – that’s exactly the question I have been asking myself. I suppose it could be achieved by disapplying the amendment that inserted Reg B13 from April 2013 and rolling back to the pre-bedroom tax version of the regs. That would work for a social tenant. But for a private tenant? A lot of water has passed under the bridge since size criteria for private tenants first appeared and it would take a considerable forensic exercise to disapply offending passages while leaving a coherent calculation method in place.

    A further difficulty is that if a remedy is available by way of increased HB, as opposed to compensation or some kind of extra-statutory enhancement, the fiendish anti-test case rules kick in. These rules provide that any “look-alikes” only become entitled to extra HB from the date of the Supreme Court’s decision unless they were already identified and stayed or subject to an interim worst-case decision at Council level. But anyone who appeals to the Tribunal against a decision made within the last 13 months would by-pass the anti-test case rules because they only act to prevent the Council from applying the decision retrospectively (and in turn to prevent a Tribunal from overturning a decision by the Council where the Council was constrained by the anti-test case rules). If an appeal to the Tribunal concerns an HB decision made before the Supreme Court handed down its decision, even if the appeal was late and admitted out of time, the Tribunal can apply Rutherford and Carmichael. You can find all this in paragraphs 16 to 18 of the Child Support, Pensions and Social Security Act 2000 (but note that para 17 has never commenced): enjoy!

  9. A lot of disabled folk may need spare room for partner to sleep OR have overnight carer so hope we have made things a bit better

  10. And we are still waiting for the regulations to be put in place. At this time, there is no indication at all, of this happening. Meanwhile we are having knowledge of more people in the Carmicheals and Rutherfords situation. And, Councils refusal to take any notice of this Judgement. No option but to ask for it to be sent on to Tribunal. Oh, and they don’t have a DHP in place either!!

  11. CRAG have said that the Regulations should be changed by the end of March. Whether the government still drag their heels, is anyone guess of course!! Meantime, the government still say, a DHP should be sought until the Regs. are changed. But of course that is going to be up to each council and their DHP pot. Meanwhile we still are hearing from people in the same circumstances………….

  12. I just thought I would mention that the regulation was dis-applied in Lucy Trengove’s case (the other case no one ever seems to mention joined with Burnip and Gorry) from a FTT dating back to 2009 and ruled incompatible.with HRA then all the points that have been mentioned since are made in that Tribunal hearing. I blame myself for not publishing this FTT decision a long while back, I suppose I’ve just got a bit out of touch since the Court of Appeal judgement in 2012 and the DWP dropping their appeal to the Supreme Court after Cameron’s statement over the bedroom tax and disabled children in 2013.

    I happy to pass it over for uploading if it helps anyone?

    It’s important to note that whilst it was dis-applied, the LA appealed immediately, then it was put on hold we should have gone to Upper Tribunal first but papers were lost by them. Then after the Burnip UT decision we were joined for Court of Appeal, Lucy passed away between Upper Tribunal decision which ruled based on Burnip and Court of Appeal Hearing. She did however receive into her Estate all monies owning dating back to 2008 the date of the original Housing Benefit decision (excluding any DHP as this was part of the deal for getting Legal Aid) AFTER the Government dropped the case to the Supreme Court in 2013. The difference financially was not a lot as she had received DHP for most of it but not all and also at one point she would have been entitled to benefit from the top up amount if your actual rent fell £15 below your LHA rate.

    I am making these points because anyone affected I would argue should appeal their original decision once the regulations are amended as they were unlawful from the offset of LHA and the Bedroom Tax. However there is that problem as I’m sure you are all aware because of the legal loop-hole of getting money back on top when you have received a DHP, Perhaps that loop-hole needs plugging legally as it would make it a lot easier to process all these claims for the cash strapped DWP and Councils. Then anyone who actually lost money from discrimination and not getting the extra bedroom on medical grounds could get it back and move forward with their correct Housing Benefit.

    • Thanks for this. The overall legal position has got rather more complicated since Burnip/Gorry/Trengrove in both Court of Appeal and the UT. As I understand it, the DWP is going to the UT in the Carmichael’s case, despite the Supreme Court win on incompatibility, in order to establish the limits of the First Tier tribunal’s ability to ‘read in’ to the Regulations to avoid a human rights breach. Moreover, as a ‘test case’, anyone who had not already filed an FTT appeal before MA/Rutherford/Carmichael in the Supreme Court, cannot benefit retrospectively from the decision (though they will from the new regulations from 1 April).

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