Court of Appeal urges mediation as council seeks repayment of housing benefit recipients were not entitled to

The Court of Appeal has urged Tendring District Council and a couple it is pursuing for dishonest housing benefit claims to consider mediation to resolve a lengthy dispute.

In a joint judgeent, Lady Justice Nicola Davies, Lord Justice Stuart-Smith and Mr Justice Cobb said: “The costs in this case…must be considerable and are at risk of being disproportionate to the sum claimed.“

They refrained from ordering mediation only because a substantive appeal was due shortly to be heard.

Judges said they raised mediation with the parties because “of the costs in this case which must be considerable and are at risk of being disproportionate to the sum claimed”.

The case has already been wound through the First Tier Tribunal and Upper Tribunal twice, a situation that saw Lord Justice Coulson condemned the tribunal service last November for causing “a series of unwarranted delays, and unexpected events, which almost beggar belief”.

Tendring now seeks to appeal a finding by the Upper Tribunal that it cannot receive sums from CD as it had not made a decision to do this and any failure had not been cured by her participation through supporting her husband in the proceedings. 

AB is a protected party, represented by the Official Solicitor, and CD is his wife.

Tendring paid them housing benefit from April 2000 to February 2012 for a property in Clacton-on-Sea, which it turned out they owned and were not entitled to this benefit. 

In July 2012, Tendring raised an overpayment decision for £67,421.79 and CD was later prosecuted for two offences of dishonesty and received a suspended prison sentence. 

But in 2007 AB had suffered a stroke which resulted in persistent neurological symptoms. Deputyship was granted to CD and her son by the Court of Protection in 2013. 

The appeal judges said they were satisfied with evidence that AB lacked capacity, although evidence on this given at earlier stages of the case had been less clear.

They said AB is a protected party for the purpose of CPR 21 and the Official Solicitor was appointed to act as litigation friend.

But they found AB was not to be treated as a protected party prior to receipt of the report on his capacity issued in May 2024 and all steps taken in the proceedings to that date have effect. 

The appeal judges said: “Subjectively, the position is that Tendring does not want AB to continue as a party but CD wishes AB to continue as one.

“The Official Solicitor contends, and we agree, that most weight should be attached to AB's position as it is his participation which is at issue.”

The Official Solicitor decided it was not in AB's best interests to continue as a party, as if Tendring’s appeal succeeded, AB could be at risk of costs being sought from him.

Judges concluded: “We are satisfied that it is in AB's best interests for him to be removed as a party to these proceedings as he has no substantive part to play in this appeal given the unappealed finding that he is liable for overpaid housing benefit. 

Continuance as a party in these proceedings puts AB at risk of an order for costs, which are considerable, and that cannot be in his best interests.”

They said the appropriate course was for the court to order that AB should cease to be a party as it is not desirable for him to continue in these proceedings. 

Mark Smulian