The Gazette 1987

GAZETTE

SEPTEMBER 1987

Ger ry Wh y te

BCL., L.L.M., M.A., B.L.

Lecturer in Law, Trinity College.

Social Welfare

Payments and the Assessments

of Damages in Civil Actions

One of the areas in which social welfare law most often

features in a solicitor's practice relates to the interaction bet-

ween social welfare payments and the award of damages in

a civil action. The best account of this area of the law is by

Dr. Robert Clark in an article entitled "Damages and the

Social Welfare 'Overlap'", (1984) 19 /r.

Jur. (n.s.)

40. It

is not intended in this brief note to cover ground already dealt

with by Dr. Clark, but rather to focus attention on the dif-

ficulties inherent in a not uncommon practice among

solicitors in this area. I refer to the practice of reimbursing

Health Boards for Supplementary Welfare Allowance (S.W.A.)

paid to successful plaintiffs in personal injuries cases.

The S.W.A. scheme is a means- Consequently it is arguable that the

tested scheme, provided for in Health Boards are acting

ultra vires

ss. 199 to 222 of the Social

Welfare (Consolidation) Act, 1981

and administered by the country's

Health Boards, which is meant to

ensure that every resident in the

State has a certain minimum in-

come. Many people rely on S.W.A.

while awaiting a decision of the

Department of Social Welfare as to

their entitlement to other pay-

ments, or in order to top up such

payments. For approximately

50,000 people, however, S.W.A.

is their primary source of income,

usually because they have ex-

hausted their entitlement to social

insurance, or had inadequate social

insurance records to begin with,

and are ineligible for unemploy-

ment assistance because they are

incapable of work. Where such a

person applies for S.W.A. and is

the plaintiff in a pending personal

injuries claim, the general practice

of the Health Boards would appear

to be to grant the allowance on

condition that the claimant give an

undertaking in writing to reimburse

the authorities out of any damages

subsequently awarded or agreed.

Is such an undertaking legally ef-

fective, or can a solicitor advise the

claimant to retain both the damages

and the S.W.A.? Surprising as it

may seem, the validity of the under-

taking would appear to be doubtful.

In the first place, the Health

Boards are not given any express

or implied powers to distribute

S.W.A. by way of loan, yet that is

surely what is attempted in deman-

ding that the claimant undertake to

repay any S.W.A. granted to him.

in insisting on such an arrange-

ment. Furthermore it is significant

that s.206 of the 1981 Act does

empower the authorities to impose

certain conditions on the granting

of S.W.A. — the claimant may be

asked to register for employment

or to apply for such other benefits

or assistance as he might be entitl-

ed to — but makes no provision for

the type of arrangement currently

under consideration.

Can the Health Boards invoke

the doctrine of estoppel against the

claimant? Generally speaking a

statutory authority cannot extend

its powers by creating an estoppel

— Re Green Dale Building Co.

This principle is usually applied in

a situation in which the other party

seeks to rely on a representation or

promise made by the authority —

see e.g.

Power -v- Minister for

Social Welfare.

But can the

authority itself rely on a promise

made by the other party? Where

the effect of that reliance would be

to allow the authority to engage in

activity which would otherwise be

ultra vires

it would seem that the

answer in principle should be no.

Finally, it should be noted that

the 1981 Act authorises the Health

Boards to recover S.W.A., initially

intended as an outright grant, in

five specific situations. These are

as follows:

1. Ss. 130(3), 1 52 and 194 allow

the Health Boards to recover

S.W.A. out of arrears of

benefit or assistance payable

to a claimant by the Depart-

ment of Social Welfare.

2. S.213(2) permits the Boards to

recover S.W.A. paid in cases

of urgency to persons in

remunerative full-time work.

3. S.21 5 empowers the Boards to

recover S.W.A. paid to a clai-

mant from any person liable to

maintain such claimant.

4. S.216(4) empowers the Boards

to recover expenses incurred in

providing for the burial of

specified persons.

5. Art. 10(1) of the Social Welfare

(General Benefit) Regulations

1953, (S.I. No. 16/1953)

authorises the Boards to

recover S.W.A. erroneously

paid to a claimant as a result of

the latter knowingly making a

false or misleading statement

or misrepresenting or wilfully

concealing a material fact.

However, none of the foregoing

covers the situation of the claimant

with the potentially successful per-

sonal injuries action. Consequently

one is led to conclude that, at pre-

sent, there is no statutory basis for

seeking to recover S.W.A. paid to

such a person.

No doubt this is a lacuna in the

law which deserves attention and

a reform giving the Health Boards

the powers which they believe

they currently enjoy does not ap-

pear unreasonable. At the same

time it should be pointed out that

at present the defendant can benefit

from the payment of S.W.A. to the

plaintiff, as s.50 of the Civil Liabili-

ty Act, 1961, as amended by s.2

of the Civil Liability (Amendment)

Act, 1964, which instructs the

courts to disregard certain welfare

payments in computing damages in

personal injuries cases, does not in-

clude

means-tested

payments in

that list.

Consequently any

reform should take into account

the overall position of the parties to

the litigation. Pending such reforms,

however, solicitors would do well

to pause before parting with their

client's money to the Health Boards,

lest that should result in more pro-

fessional negligence actions.

•

F o o t n o t e s

1. [1977] I.R.256.

Unreported, High Court, 9 July 1987.

See Clark,

toe. cit.

pp. 41-42.

281