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Bill Irvine £76,000 overpayment success!

RLA
Written by RLA

RLA trainer, Housing Benefit (HB) and Universal Credit (UC) expert Bill Irvine is back with another warning tale of a council looking to claw back Housing Benefit payments. Bill was left disappointed with the maladministration of this situation, and landlords should be wary of Councils overlooking to ‘claw back’ what they consider overpayments. Read on for Bill’s explanation of the situation:..

RLA trainer, Housing Benefit (HB) and Universal Credit (UC) expert Bill Irvine is back with another warning tale of a council looking to claw back Housing Benefit payments. Bill was left disappointed with the maladministration of this situation, and landlords should be wary of Councils overlooking to ‘claw back’ what they consider overpayments. Read on for Bill’s explanation of the situation:

“Representing landlords in relation to HB Overpayment disputes with councils is a routine event for me, especially these days with DWP incentivising local authorities to identify and pursue recovery of the £1.8 billion overpaid in HB each year. Most of the amounts range from £500 to £3000; large sums by anyone’s standards. On occasions, I’ve been asked to intervene where the amounts have involved £10K to £28K. Many of the cases involve RLA members and have been highlighted in the RLA’s Newshub http://news.rla.org.uk/rla-member-challenges-hb-overpayment-claim/

Around 18 months ago, I received a call from a landlord where the overpayment amounted to £76,000. The council, in this instance, wasn’t pursuing the landlord. Rather, it had sent an invoice for the £76k to the landlord’s 88 year old mother, demanding payment within 7 days. As the lady concerned receives Pension Credit there was little likelihood of that ever happening.

Background

The property in question is located in London. It has 3 bedrooms and was previously the home of one of the landlord sons, who had invited his mother to join him, his wife and disabled sister after her husband died. A few years later, following the birth of his own son, he and his new family, decided to move out, initially renting a property, leaving the mother and sister there. The mother and disabled sister claimed Housing Benefit in 1990. The claim was initially refused because the landlord was the son (a close relative) but after an appeal the council decided to pay HB at £400 per calendar month, following referral to the Rent Officer. In 1992 the daughter left leaving the mother on her own. Each year between 1991-2003, the old lady and her landlord son were asked to complete renewal forms and provide rent statements demonstrating that rent was being paid.

Revision

Everything was hunky dory until in April 2014 the tenant received a cold call ‘welfare’ visit, from two of the council’s Fraud Officers, followed up by a second visit and somewhat hostile interview in May 2014. The officers concerned established the landlord son had not increased the rent in the intervening years and so decided the agreement (AST) between the parties was non-commercial in nature and as a fall-back maintained the landlord son had set up the arrangement to “abuse the HB scheme” even though the rent being charged was less than half what he could have charged. He hadn’t increased the rent because it was his mother, the rent level was initially determined by the Rent Officer and it met the cost of the mortgage, repair and maintenance costs. The officers’ decision resulted in HB being cancelled from 1998 to 2014 creating, in turn the ridiculous overpayment and invoice for payment within 7 days!

Defence

I drafted an appeal for the tenant and after some months of prevarication, the council decided to restore HB for the lion’s share of the period, leaving a residual £11k overpayment between 2012 to 2014.

A further appeal was lodged against the residual overpayment. This was considered by an Appeal Tribunal on 21 August 2015.  The Judge adjourned the hearing and directed the council to address the key points of my submission; explain the basis of its original £76k overpayment decision; the subsequent £11k revision; and why the tenant was still being held responsible for a decision, clearly caused by the council “going to sleep” and failing to review the case, on at least a bi-annual basis, between 2003 and 2014.

The council initially failed to respond to the Judge’s directions notice, requesting instead, more time to respond. Ultimately, on 28 September 2015, the residual £11k overpayment was reviewed and revised to NIL by the council much to the family’s relief.

What was most disappointing about this case was the fact I had highlighted the dispute to the council’s Head of Benefits and wrote separately, on two occasions, to the council’s Chief Executive spelling out why the council’s overpayment decision(s) were completely without merit, and should therefore be cancelled immediately to avoid causing any further anxiety and cost to the tenant. My repeated pleadings fell on deaf ears!

Only when directed by the Tribunal Judge directed them to respond to my pertinent questions did the council’s Senior Appeals Officer, review and cancel the overpayment.

The Judge’s directions in this case left the council in no doubt there could only be one outcome – a favourable decision for the appellant tenant. The council’s handling of the HB claim; its decision to create the £76K overpayment; invoice an 88 year old woman, seeking payment in 7 days; was undoubtedly the worst example of council maladministration that I’ve seen in 30 years.

Consequently, the tenant is now seeking financial compensation for the stress, anxiety, grave injustice and costs, caused, by the local authority’s sheer incompetence, and dispassionate attitude to the plight of an 88 year old lady.”

Bill is available for anyone who may have questions about Housing Benefits (HB) or Universal credit (UC). To contact bill visit his website: www.ucadvice.co.uk or call him directly 01698 424301 or 07733 080 389

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About the author

RLA

RLA

The Residential Landlords Association (RLA) represents the interests of landlords in the private rented sector (PRS) across England and Wales. With over 23,000 subscribing members, and an additional 16,000 registered guests who engage regularly with the association, we are the leading voice of private landlords. Combined, they manage almost half a million properties.

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  • That must have been one of the most worthwhile cases for Bill to have fought.

    Why is it that local authorities continue down a path where morally and legally they are on a loser – even when it is pointed out to them. They seem to forget that they are servants of the community, entrusted to administer the council’s business for the common good of the residents. Sadly, officers of many councils forget that it is our money, and they squander it away with little thought..

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