Minister for Social, Community and Family Affairs v Scanlon

JurisdictionIreland
JudgeFENNELLY J.
Judgment Date16 January 2001
Neutral Citation[2001] IESC 1
CourtSupreme Court
Docket Number[1997 No. 277S, S.C. No. 136 of 1999]
Date16 January 2001
MIN FOR SOCIAL COMMUNITY & FAMILY AFFAIRS v. SCANLON
BETWEEN/
THE MINISTER FOR SOCIAL COMMUNITY & FAMILY AFFAIRS (FORMERLY MINISTER FOR SOCIAL WELFARE)
APPELLANT

AND

MICHAEL J SCANLON
RESPONDENT

[2001] IESC 1

Keane C.J.

Denham J.

Murray J.

McGuinness J.

Fennelly J.

136/99

THE SUPREME COURT

Synopsis:

Social Welfare

Social welfare; recovery of social welfare overpayments; retrospective effect of legislation; appellant seeking repayment of sum of benefit "overpaid" to the respondent; respondent had received a disability benefit dependent on his being incapable of work; respondent's right to disability benefit was reviewed in 1994 as a result of further information; whether social welfare legislation has retrospective effect; whether there is any constitutional imperative that legislation should be construed only prospectively; whether the words of statute clear enough to rebut the presumption against retrospective effect; whether there was sufficient machinery for statutory recovery of the debt; whether a new demand for the repayment was necessary after the appeals officer had made his decision; s.300(5)(aa), Social Welfare Act, 1981 as inserted by s.35, Social Welfare Act, 1991; s.40, Social Welfare Act, 1992; s.31(1), Social Welfare Act, 1993; ss.278(a) & 283(b), Social Welfare (Consolidation) Act, 1993.

Held: Appeal allowed.

Min for Social Community and Family Affairs v. Scanlon - Supreme Court: Keane C.J, Denham J., Murray J., McGuinness J., Fennelly J. - 16/01/2001 - [2001] 1 IR 77 - [2001] 2 ILRM 342

The Minister had sought the repayment of a social welfare benefit. In the High Court Ms. Justice Laffoy held that the provision in question for the repayment of monies had a retrospective effect and the statute should be interpreted as having a prospective effect only. The claim was dismissed. In the Supreme Court, Fennelly J held that claim should be allowed and a decree would be granted to the Minister for the amount in question.

Citations:

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S248

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S249(b)

SOCIAL WELFARE ACT 1952 S15

SOCIAL WELFARE ACT 1952 S29

SOCIAL WELFARE ACT 1952 S42

SOCIAL WELFARE ACT 1952 S46(1)

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300(1)

SOCIAL WELFARE ACT 1993 S31(1)

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S248(1)(a)

SOCIAL WELFARE ACT 1952 S46(5)

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300(5)(a)

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S300B(a)

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S249(1)

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300(5)(b)(i)

SOCIAL WELFARE ACT 1991 S35

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300(5)

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300(5)(aa)

SOCIAL WELFARE ACT 1992 S40

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S249

HAMILTON V HAMILTON 1982 IR 467

ATHLUMNEY, IN RE EX PARTE WILSON 1898 2 QB 547

CRAIES ON STATUTE LAW 7ED 387

MAXWELL INTERPRETATION OF STATUTES 12ED 215

CONSTITUTION ART 15.5

DUBLIN HEATING CO LTD V HEFFERON KEARNS LTD 1992 ILRM 51

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300(5)(b)

O'H V O'H 1990 IR 558

L'OFFICE CHERIFIEN V YAMASHITA-SHINNIHON STEAMSHIP CO LTD 1994 1 AC 486

SOCIAL WELFARE (GENERAL BENEFIT) REGS 1953 SI 16/1953 REG 10

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300D(4)

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S117

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300(4)

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S278(a)

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S264

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S279

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S278

SOCIAL WELFARE (CONSOLIDATION) ACT 1981 S300H

SOCIAL WELFARE (CONSOLIDATION) ACT 1993 S283(b)

SOCIAL WELFARE ACT 1951 S54

1

JUDGMENT delivered the 16th day of January, 2001 by FENNELLY J. [Nem diss]

2

The cycle of continual amendment and periodic consolidation of the Social Welfare Acts inevitably throws up problems concerning the effect of legislative change on past events. The present appeal concerns principally whether retrospection is to be given to a change designed to add to the armoury of means of recovery of social welfare over-payments by the Minister for Social Community and Family Affairs (whom, for brevity, I will describe as the Minister).

3

The respondent, Michael J Scanlon, worked as a Signalman for Córas lompair Eireann until 27th July, 1985 when he was released as unfit for work due to failing eyesight. He applied for disability benefit, which he was awarded as from 24th September, 1985. This depended on his being incapable of work. Between that date and 25th May, 1994 ("the relevant period") he was paid disability benefit at the rates prevailing from time to time amounting in total to £43,088.25.

4

In 1994, as a result of further information, the respondent's right to disability benefit was reviewed. It is important for an understanding of the issues to distinguish between the two stages of that review, namely the decision of the Deciding Officer and the decision of the Appeals Officer.

5

The Deciding Officer on 15th June, 1994 decided "under the authority of section 248 of the Social Welfare (Consolidation) Act, 1993" to revise the original decision. She decided that for the entire of the relevant period for which disability benefit had been paid the respondent had "worked" and that the benefit was "disallowed."

6

She further explained that "benefit in respect of all the above days was paid on the basis of statements or representations which were false or misleading in a material respect or by the wilful concealment of material facts and as a consequence that the benefit paid is repayable."

7

The effect of this decision was conveyed to the respondent by a letter of 17th June, 1994 which, the Minister says, constitutes a demand for the repayment of the sum in question, £43,088.25. That letter also informed the respondent of his right to appeal against the decision, which he duly did.

8

The decision of the Appeals Officer dated 3rd April, 1995 was made following an oral hearing. It includes a summary of findings of activity by the respondent in the provision of a school bus service, a hackney car service and in the ownership and running of a public house. The Appeals Officer rejected as "simply not credible" the respondent's contention that, although owner of these businesses, he was not involved in running them. She expressed herself as "quite satisfied that this businessman was working while claiming and in receipt of Disability and Pay Related Benefit." However, it is crucial to the argument in the appeal before this court that the Appeals Officer continued as follows:

"On the question of whether he claimed with fraudulent intent, I am not quite so sure. All businesses had been in operation while he was employed by CIE, and he claims that this caused confusion. In the light of this explanation, I feel that it would be difficult to sustain an accusation of fraud. I am satisfied however that in the light of the new evidence of his involvement in business enterprises, he was not entitled to benefit in respect of absence from work due to illness, and that any benefit paid should be disallowed under Section 249(b) of the Social Welfare (Consolidation) Act, 1993. My decision to this effect is attached."

9

The "attached" decision is merely a summary of the conclusion of the Appeals Officer. It states:

"Decision of Appeals
10

I decide that in the period from 24 September 1985 to 25 September 1985 to 25 May 1994, Mr Michael Scanlon RSI No. 01115536 was not entitled to Disability or Pay-Related Benefits as new evidence available shows that he was working during this period."

"Note on reasons for Decision
11

On examination of the evidence I am satisfied that the Appellant's involvement in his businesses as Manager and Occasional operator, constituted work and that he derived benefit from this work. I am not fully satisfied that the Appellant knowingly made false or misleading statements in claiming Disability Benefit, but based on the new evidence that he was working, I am satisfied the Benefit was not payable and should be refunded."

12

I draw attention to two critical features of this decision. Firstly, it alters the statutory reason for the decision given by the Deciding Officer. In depends not on "false or misleading"statements or "wilful concealment" of material facts but simply on "new evidence that [the respondent] was working." Secondly, though not using words descriptive of the exercise of a discretion, the Appeals Officer was, in fact, doing just that when she said that she was "satisfied that Benefit was not payable and should be refunded."

13

For the purposes of the legal issues in this appeal, the decision of the Appeals Officer has to be taken as finally deciding that the respondent had not been entitled to the benefit he received, because he was not, at any time during the relevant period, disabled from work. The respondent did not seek judicial review of the decision.

14

The Minister issued a Summary Summons on 28th May, 1997 claiming the sum of £43,088.25 on the basis that it represented benefit "overpaid" to the respondent and that it had been formally demanded from him on 17th June, 1994. The Special Indorsement of Claim says that the proceedings are maintained "in accordance with the provisions of the Social Welfare Act, 1993."

15

The proceedings came on for hearing before Miss Justice Laffoy in the High Court on the basis of the affidavits. In a judgment of 11th May, 1999, she dismissed the Minister's claim on grounds which can only be understood when the legislation is discussed, but briefly were to the effect that:-

16

1. Insofar as the claim related to sums paid to the respondent prior to 1st April, 1991 they depended on a legislative change made in that year which should not be interpreted as having retrospective effect.

17

2. Insofar as they related...

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