NT v First-tier Tribunal (CIC) (Criminal Injuries Compensation : reduction and withholding of awards) [2014] UKUT 210 (AAC) (08 May 2014)

IN THE UPPER TRIBUNAL UT Ref. No.: JR/2865/2013

ADMINISTRATIVE APPEALS CHAMBER

Before Judge S M Lane

DETERMINATION OF AN APPLICATION FOR JUDICIAL REVIEW

I REFUSE permission to judicially review the decision of the First-tier Tribunal heard under reference no. X/11/232722 on 19 June 2013.

The appeal is, however, remitted to the First-tier Tribunal in accordance with the case management directions on page 7.

REASONS

1 This determination is made following an oral hearing on 3 March 2014. The hearing was conducted by video link with the institution at which the applicant resides (St. Andrews Healthcare) whilst counsel for the interested party (‘CICA’) appeared in person at the hearing venue, Field House. The applicant was not represented, but was accompanied by Mr Darren Smith, a social worker at the institution. CICA was represented by Mr Owain Thomas, of counsel. The First-tier Tribunal, which is technically the respondent, did not take part in the proceedings. This is normal practice.

2 The issue was whether I should grant the applicant permission to proceed to judicial review of the First-tier Tribunal’s decision to strike out his appeal against CICA’s earlier refusal to award him criminal injuries compensation.

Background

3 The background to this application is this: The applicant was the victim of a criminal assault in November 2008 as a result of which he says he suffered injuries. He attributes his mental health problems to the assault, and claims that the assault also led to his involvement in criminal offences.

4 On 12 September 2009, he lodged a claim for criminal injuries compensation under the 2008 Criminal Injuries Compensation Scheme with CICA. CICA refused the claim because it was made outside the 2 year time limit for making claims under paragraph 18 of the Scheme 2008 and pointed out that, even if it had admitted the claim, any award would be subject to a substantial reduction to reflect the applicant’s unspent criminal convictions under the ‘penalty points’ system operated under the Scheme.

5 The relevant provisions of the Scheme are paragraphs 13(1)(e) and 14(3) as further explained in Appendix 5 of the Guide to the Criminal Injuries Compensation Scheme. CICA is required to publish this guide on how it operates the Scheme under paragraph 22.

6 On 6 January 2012, the applicant asked CICA to review its decision. It did so on 16 January 2012 but did not change its decision. The applicant appealed against that decision, and on 26 April 2012, a First-tier Tribunal allowed an appeal against the refusal to waive the time limits for claiming, largely because of the applicant’s enduring mental illness.

7 CICA then made a further decision, and rejected the claim on 13 June 2012 (A13). It reviewed and maintained that decision in March 2013 (A16). The reason for refusal was that the applicant’s character, as evidenced by his criminal convictions, made any award inappropriate by virtue of paragraphs 13 and 14 of the Scheme as explained in the Guide.

Paragraph 13(1):

‘A claims officer may withhold or reduce an award where he or she considers that: …

(e) the applicant’s character, as shown by his or her criminal convictions (excluding convictions spent under the Rehabilitation of Offenders Act 1974 at the date of application or death) or by evidence available to the claims officer makes it inappropriate that a full award or any award at all be made.’

Paragraph 14(3):

‘In considering the issue of character under paragraph 13(1)(e) a claims officer must withhold or reduce an award to reflect unspent convictions unless he or she considers that there are exceptional reasons not to do so.’

8 The result of these two provisions is that, whilst a claims officer has a discretion to withhold an award or the amount by which it will be reduced, the officer must make some reduction for unspent convictions unless there are exceptional reasons not to do so.

9 The Scheme itself leaves the amount of any reduction open, but the reduction is normally assessed in accordance with the guidance in Appendix 5, which sets out the penalty points system by which unspent convictions are converted into percentage reductions in an award.[1] A transparent system for reckoning the effect of convictions on an award is clearly necessary to ensure consistency of awards for claimants with similar conviction records, but it is also obvious that the system needs to retain the flexibility to deal with exceptional circumstances. So, as CICA makes clear in the guidance, the penalty points system is only a starting point.

The applicant’s criminal record

10 The applicant in this case has unspent criminal convictions going back to 2005, several years before the date of the assault which he claims triggered his mental health problems and subsequent criminal behaviour. When totted up, he had 15 points, well over the 10 points at which a 100% reduction would normally be made.

11 However, from 2005 to October 2008 (shortly before the criminal injury) the record shows that he had only 3 points and had sentenced to fines and a community punishment order. From the date of the assault onwards, the types of criminal offences for which he was convicted attracted more serious punishments (consequently more points) than the earlier offences.

12 The applicant appealed this decision.

13 On 23 May 2013, the First-tier Tribunal gave directions proposing to strike out the whole of the proceedings on the basis that it had no reasonable prospect of success under rule 8(3)(c), subject to giving the applicant the opportunity to make representations about the striking out (rule 8(4)).

14 The First-tier Tribunal’s directions drew attention to the number of convictions, their seriousness and the period of time over which they were committed. It opined that the grounds for mitigating the normal consequences of the penalty points were ‘not relevant because they are not supported by evidence that the applicant could reasonably have been expected to provide in support of his appeal (e.g. medical evidence) and do not provide any exceptional reason why an award should be made.’

15 The applicant responded by letter of 30 May 2013 (T5). He explained why he had no further medical evidence, that he was in a mental institution and that should be evidence enough. He added that he could not live in the community without an award and that it was unfair to refuse him an award for things he had done in the past.

16 A differently composed First-tier Tribunal proceeded to strike out the appeal without an oral hearing. It relied on the reasons given by the previous First-tier Tribunal in its strike out directions. It concluded that ‘while [the Tribunal] had sympathy with the applicant, it had no alternative but to strike out the appeal (as having no reasonable prospect of success).

17 That was wrong in law. Rule 8(3)(c) is permissive, not mandatory. The Tribunal may, not must, strike out the appeal, if it has no reasonable prospect of success.

18 In addition, the First-tier Tribunal’s decision to use the strike out procedure was fundamentally flawed. Striking out is a drastic step. As Judge Rowland pointed out in R (AM) v First-tier Tribunal (Criminal Injuries Compensation) [2013] UKUT 333 (AAC),

[11].’The effect of striking a case out under rule 8(3)(c) is to deprive a person of an oral hearing and it should therefore be used to weed out hopeless cases, but not cases that are merely weak. Moreover, it is important that it is not used in a way that prejudices those better at expressing themselves orally than in writing and in particular so that those with mental health problems are not prejudiced’

[19] ‘There can be little objection to striking a case out under rule 8(3)(c) without a hearing where the issue is a straightforward point of law arising on uncontentious facts, since an appeal on a point of law or judicial review provides an adequate remedy in the event of a Tribunal being wrong. However, striking a case out under an equivalent to rule 8(3)(c)…has been held not to be appropriate where there are unresolved issues of fact requiring the hearing of evidence (AW v Information Commissioner [2013] UKUT AAC). In my view, it is also not appropriate where there is a discretion to be exercised upon which oral argument might be appropriate. A hearing is guaranteed both so that oral evidence may be given and so that there may be oral argument. This is particularly important where claimants are unrepresented. Many litigants in person are better at expressing themselves orally than in writing and, as a class, they are notoriously bad at understanding what evidence is required in order to support their cases and how it should be presented or obtained. Moreover, decisions on fact or as to the exercise of a discretion cannot usually be challenged where an appeal lies only on a point of law or the only method of challenge is judicial review’.

19 As in R (AM), the instant case is one in which the 2008 Scheme gives discretion to the Tribunal in deciding the extent to which an award may be reduced or withheld, and where oral argument might be appropriate.

20 As far as the discretionary element is concerned, since different Tribunals may reasonably take different views on the extent to which penalty points should be disregarded, it is in principle inappropriate to pre-empt a Tribunal from hearing the substantive appeal by striking out proceedings under rule 8(3)(c), at least without an oral hearing.

21 Factors that pointed strongly towards the impropriety of using the strike out procedure at all include the applicant’s enduring mental illness, his residence in a mental institution making it difficult for him, perhaps, to get further evidence and his lack of legal representation.

22 A factor which pointed strongly towards having an oral hearing, if the Tribunal nevertheless considered it reasonable to continue down the strike-out route, was that there did appear to be a change in the nature of the applicant’s criminal offences following the assault. This was a matter which might have lent some plausibility to the applicant’s submission and which might be best dealt with orally.

23 The overriding objective of the First-tier Procedure Rules provides further reinforcement for the need for considerable circumspection in the use of rule 8(3)(c). Tribunals must deal with cases fairly and justly under rule 2. Striking out a case in circumstances such as arise in this case will rarely meet that objective.

24 This was a case in which the strike out procedure was, in all of the circumstances, unfairly used. If the Tribunal wished to use the striking out procedure despite the applicant’s mental health problems, there should have been an oral hearing to give the applicant a fair chance to explain his case.

25 To sum up,

(i) the Tribunal did not get to grips with central problem affecting the applicant. He suffered from an enduring, delusional mental illness into which he had little or no insight and was being detained long-term in a secure mental hospital for treatment. He had nevertheless managed to establish that he had in fact been assaulted, despite initial doubts about the existence of the offence against him.

(j) the previous strike out directions emphasised a lack of medical evidence ‘that he could reasonably have been expected to provide’. But the applicant had adduced medical evidence. It was not apparent what further medical evidence the Tribunal wished to see. Was the Tribunal thinking about the need for medical evidence showing a change of personality? It is far from plain that it was.

(k) the main sticking point in the case was whether there were exceptional reasons not to take account of some or all of the penalty points. The applicant had tried to explain why his case was exceptional, in layman’s terms. It is not surprising that the applicant was unable to explain in writing what his case was about: paragraph 13(1)(e) does nothing to explain the sorts of reasons that might be taken into account. Even a lawyer might be left wondering.

(l) The applicant was unrepresented and his written representations showed that he did not understand what case he had to answer.

The remedy

26 Although the Tribunal has erred in law, in my view, this is an application for judicial review. Although it is a matter of discretion whether I grant permission to proceed or not, I bear in mind that a party should not resort to judicial review until he has exhausted alternative remedies.

27 In my view, there is an adequate alternative remedy available to the applicant which should be pursued before engaging the judicial review procedure.

28 In my view, the applicant was entitled to an oral hearing to reconsider the decision to strike out the appeal, under rule 27(4) of the First-tier Procedure Rules, which should have been used. Mr Thomas for CICA agrees with the view I take of regulation 27(4) and that the best way forward is to remit the matter to the First-tier Tribunal.

29 I note that the applicant wrote to the Tribunal promptly after the strike out order was made. He did not ask for a reconsideration, but I do not know what documentation was sent to him which might have told him what to do. In any event, the Tribunal could have taken the initiative here and offered the more appropriate procedure.

30 Rule 27 of the First-tier Procedure Rules provides

27.-(1) Subject to the following paragraphs, the Tribunal must hold a hearing before making a decision which disposes of proceedings unless-

(a) each party has consented to, or has not objected to, the matter being decided without a hearing; and

(b) the Tribunal considers that it is able to decide the matter without a hearing.

(2) This rule does not apply to decisions under Part 4.

(3) The Tribunal may in any event dispose of proceedings without a hearing under rule 8 (striking out a party’s case).

(4) In a criminal injuries compensation case-

(a) the Tribunal may make a decision which disposes of proceedings without a hearing; and

(b) subject to paragraph (5), if the Tribunal makes a decision which disposes of proceedings without a hearing, any party may make a written application to the Tribunal for the decision to be reconsidered at a hearing.

(5) An application under paragraph (4)(b) may not be made in relation to a decision-

(a) not to extend a time limit;

(b) not to set aside a previous decision;

(d) not to allow an appeal against a decision not to reopen a case.

(6) An application under paragraph (4)(b) must be received within 1 month after the date on which the Tribunal sent notice of the decision to the party making the application.

31. The structure of this rule is not without difficulty. There is a general rule in 27(1) that the Tribunal must hold a hearing (which means an oral hearing under rule 1(3)). This does not apply, however, to decisions on correcting, setting aside, reviewing and appealing Tribunal decisions under part 4 of the Rules. Rule 27(3) additionally sets out a further exception by virtue of which the Tribunal may strike out a case under rule 8 without a hearing.

32. Rules 27(4) and (5), however, set out special provisions for criminal injuries compensation cases. Under rule 27(4), if a Tribunal hearing a criminal injuries compensation appeal makes a decision which disposes of proceedings without a hearing (as would be a decision to strike out an appeal), a party can ask for the decision to be reconsidered at an oral hearing. If such an application is made, the accepted view is that the party has a right to an oral hearing.

33. Rule 27(5) sets out a number of exceptions where there is no right to an oral reconsideration. Striking out is not one of them.

34. The question that arises is whether rule 27(4) creates a free-standing regime for criminal injuries compensation cases, or whether it must be read subject to rules 27(1) - (3). If the former, a party whose appeal is struck out can have the matter reconsidered at an oral hearing. In that sense, he is in a better position than other parties whose cases are heard in the Social Entitlement Chamber, who are not permitted this opportunity. If, on the other hand, rules 27(4) and (5) must be read subject to the earlier provisions, they are no worse off than the generality of parties who have no such right.

35. Either construction is possible, but I have come to the conclusion that rules 27(4) and (5) should be treated as a free-standing regime for criminal injuries compensation cases. Criminal injuries compensation cases are unique in the Social Entitlement Chamber in having limited rights of appeal: whilst a claimant is entitled to appeal to the First-tier Tribunal against a decision by CICA, neither party is entitled from a First-tier Tribunal decision to the Upper Tribunal. They must proceed by way of judicial review.

36. Given the different routes for pursuing challenges to decisions, there is no necessary reason why criminal injuries compensation cases should be treated in the same way as other Social Entitlement Chamber cases, and it is clear that they are not. There is, for example a striking contrast between Rule 27(4)(a) which gives the First-tier Tribunal a general discretion to make a decision which disposes of a case without a hearing, whereas rule 27(1) places a duty on a Tribunal to hold an oral hearing.

37. The exceptions in rule 27(5) to the wide rule in 27(4) are carefully set out. If strike out decisions were meant to be excluded from the general right to an oral reconsideration hearing, it would have been very easy to say so.

38. In the upshot, I REFUSE the application for permission.

SUGGESTIONS FOR FURTHER CONSIDERATION OF THE MATTER

39. Because I have not granted permission to judicially review the matter, I do not have any power to order the First-tier Tribunal to take further steps. It may nevertheless be helpful for the First-tier Tribunal to have my view on how this matter may be dealt with fairly. It is not binding on the First-tier Tribunal.

40. The correct application for the applicant to have made would have been for an oral reconsideration of the decision to strike him out. Instead, he tried to make an appeal and was then sent guidance on judicial review, on which he acted promptly.

41. The rules on making applications are not easy for lawyers, let alone laymen and in this case, the applicant was also suffering with significant mental health problems. Had the issue of oral reconsideration been spotted (and it was a difficult one to spot), it is likely that a First-tier Tribunal Judge would have written to the applicant to tell him that he should apply for oral reconsideration.

42. The application for oral reconsideration would have to have been lodged within one month after the date on which the Tribunal sent notice of the decision in question (rule 27(6), First-tier Procedure Rules), and time would have been running against the applicant. The time limit can, of course, be extended.

43. I would suggest that the applicant make an application for oral reconsideration of the strike out decision right away. The application will be very late, but in all of the circumstances, the First-tier Tribunal might well think that the reasons for delay are good, and that there is merit in the application. The overriding objective in rule 2 to treat cases fairly and justly could be seen to point towards accepting the application.

44. If an application is received for an oral reconsideration, the Tribunal should keep in mind its power to vary its directions. It might consider rescinding the strike out direction and simply proceeding to an oral hearing of the substantive issue.

45. If the direction is not set aside, it would seem appropriate to hold an oral hearing to decide whether the appeal should be struck out.

46. It is possible to make arrangements with the mental health institution at which the appellant resides for an video link for an oral hearing.

[Signed on original] S M Lane

Judge of the Upper Tribunal

[Date] 9 May 2014

[1] Penalty points are based on the type of sentence (e.g. imprisonment, fine, community order), the length of sentence or amount of a fine, and how close in time the sentence passed is to the date CICA received a claim for compensation. The number of points which the unspent convictions attract then correlates to set percentage reductions in the amount of any award. So, for example, If a claimant has only 1 penalty point, an award is reduced by 10% whilst if he racks up 10 penalty points, the reduction is 100%

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