[2024] UKUT 405 (AAC)

2007-2018 CA Entitlement (Reg 1408/71)

As I have explained above, the EU regulation that was in force on 1 October 2007 was Reg 1407/71. It remained in force for the UK until 2010, and for Switzerland until 2012. It is not suggested that there was any change of circumstances that would affect SE’s entitlement between 2010 / 2012 until 12 November 2018, within the meaning of Art 87(8) of Reg 833/2004, prior to the application in relation to C3 in 2018. Accordingly, the question of competent state for the whole of this period must be determined in accordance with Reg 1408/71.

As I have said, the Respondent has, subject to the “academic” point, in effect conceded this issue, in Mr Vandermann’s submission of 14 October 2022. If that goes too far, she has in any event declined to advance any submissions on the point, in the face of Judge Jacobs indication that he considered that he might need to determine this issue, and his preliminary concerns that the UK was the competent state under Reg 1408/71. However, given its knock-on consequences for Reg 833/2004, I do not think I should deal with it solely as a matter of concession.

I approach this issue on the basis that:

Given my conclusions on Art 28, below, and in light of the doubt about whether the Appellant is an “employed person” in her own right, I don’t think it is necessary to determine the “legislation applicable” to the Appellant under Title II. For completeness, for reasons that are in parallel to those set out below in relation to Reg 833/2004, I think that the legislation applicable to SE under Title II of Reg 1408/71 is that of the UK, which is also therefore the competent state for the purposes of Title II. I have a slight hesitation on this only because Art 13(2)(f) (unlike Art 11(3)(e) of Reg 833/2004) is said to apply only “where the legislation of a Member State cease to be applicable”. I do not know whether SE was ever subject to the legislation of Switzerland, but if she were not then it could be argued that Art 13(2)(f) does not apply to her at all. However, that would leave no way of determining what legislation applied to SE, without affecting in any way her entitlement to benefits under UK law as UK citizen residing in the UK.

So the question is whether any of the provisions of Title III make Switzerland the competent state for the payment of cash sickness benefits to SE, so as to disapply the entitlement which she would otherwise enjoy by reason of her residence in the UK, and / or because the UK’s legislation is applicable to her under Title II.

The provision which governed the payment of cash sickness benefits to pensioners and their family members in Reg 1408/71 is Art 28, which I have set out above. This is stated to apply where the pensioner “is not entitled to benefits under the legislation of the Member State in whose territory he resides”. So this only applies to a pensioner where the pensioner is not entitled to cash sickness benefits in the state of residence. At least in relation to the pensioner, therefore, it does not have the effect of removing entitlement in the host state, if the legislation of that state entitles the pensioner to sickness benefits.

I can see a possible linguistic argument that this condition does not apply to family members. On a literal reading, it is the pensioner himself who must be “not entitled”. If that condition holds, as it may well do for SE’s husband, then it might be argued that the rest of the article applies, so that the pensioner “shall receive such benefits for himself and members of his family” from the pension paying state, regardless of whether the family member is entitled to benefits in the state of residence.

This would an exceptionally odd result, in that it would mean that the right of the pensioner themselves to receive benefits in the state of residence would be unaffected by the fact that they may have such a right from the state that pays their pension, but the right of their family members to receive benefits in the state of residence is removed by the fact that their family member (parent, spouse etc) has a pension from another country, whatever independent rights they may enjoy without reference to that family member.

I do not think this is required by the language of Art 28, even read very literally. Art 28 provides that, where the pensioner is not entitled to benefits in the state of residence, “he shall receive such benefits for himself and his family”. On its strict language, it therefore grants a right to the pensioner himself, not to the family member. Further, applying a “teleological” approach as is required when construing EU law provisions, the general thrust of Art 28 cannot be read as taking away a right from family members, in circumstances where the obvious purpose is to ensure that the pensioner and his family are not left without assistance by reason of a lack of entitlement in the host state (and see again ¶44 of Harrington). Nothing in Art 28 expressly states that either the pensioner or his or her family member is not entitled to benefits from the state of residence.

It follows that, under Reg 1408/71, and for any period after the coming into force of Reg 833/2004 during which there was no change of circumstances for SE, the UK was the competent state for the payment of cash sickness benefits to SE. It follows that the FTT erred in law in substituting a decision that SE was not entitled to CA from 18 October 2007, when Reg 1408/71 was in force, and that decision must be set aside.