The Tribunal sought to construe the phrase ‘an immediately repayable debt’ for Income Support purposes : ‘A person has to pay his debts. He has no choice in the matter and if he has no choice, then any divesting of capital resources in pursuance of the reduction or discharge of his indebtedness cannot be for the purpose of securing supplementary benefit or any increase thereof. Such a motive cannot direct or influence his course of action. There can only be one purpose governing his conduct, namely the need to meet his indebtedness.
14. Of course, the above principle only applies where the relevant debt is immediately payable. If the obligation to repay does not mature for several years, or, as in the case of the usual mortgage of house property, there is no need to repay the sum borrowed, provided the agreed interest and capital repayments are kept up, then any premature repayment of indebtedness will be voluntary act constituting a deliberate choice. And if there is a choice then the question will arise as to whether a significant operative purpose albeit not necessarily the predominant purpose, was to secure supplementary benefit or any increase thereof (R(SB) 38/85; R (SB) 40/85).
15. In the present case, if the Tribunal find as a fact that the claimant was genuinely indebted to his daughters, and they must be satisfied that there was a legal debt capable of enforcement in the courts, and if they are satisfied that such debt was immediately repayable, then as regards any sum employed in reduction or discharge of that indebtedness, regulation 4(1) will have no application. But if the new Tribunal are not so satisfied, and consider that there was no such indebtedness enforceable at law, or, if there was, that it was not immediately repayable, they must then go on to consider whether a substantive reason for the payment to the daughters was to secure supplementary benefit.’
Judges:
Commissioner Rice
Citations:
R(SB) 12/91
Jurisdiction:
England and Wales
Cited by:
Cited – Jones v The Secretary of State for Work and Pensions CA 10-Jul-2003
The claimant had spent some twelve thousand pounds on a car. She now appealed a refusal of benefit based upon the suggestion that she had deliberately reduced her capital to make herself eligible. She had sold land, but the proceeds had been used to . .
Lists of cited by and citing cases may be incomplete.
Benefits
Updated: 29 August 2022; Ref: scu.186339