Who is treated as having the capital?

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    The claimant owned a property which they sold in June 2006 and they received £46000.00 in capital.

    The claimant then moved to a rented property and gave £40000.00 to the landlord as they had assisted the claimant in making the repayments on the mortgage at the previous property and also loaned some money to pay off other debts.

    The claimant showed her bank statements confirming settlement from the sale of the property and that £40000.00 was transferred the next day, the landlord also confirmed that the money was transferred into their bank account the next day.

    I have asked for confirmation of any legal documents in respect of the loan of money and how this was to be transferred but I have not had a response.

    The claimant was in receipt of IS before the sale of the house and this has been terminated as a result of having income in excess of £16000.00. The claimant has appealed against our decision to treat the claimant as having capital and also the I/S decision.

    I am at a loss as what to do with this as we do not have anything concrete to say that the tenant has this capital in her possession however, I am not happy to accept her word for it that she had to return the capital as repayment of loans.

    I also tried non-commerciality with the resident landlord however, he did not respond to my questions. Any suggestions for a way forward would be gratefully received.

    Many Thanks


    Seems to me it is a case of either actual capital still in the possession of the claimant or possibly deprivation. The first issue seems to be dealt with by the evidence presented by the claimant that the money has indeed gone. The issue of deprivation will have to be looked at on the basis of the good old “significant operative purpose” test, which will turn on the evidence of this particular case. I am not clear where non-commerciality fits into all this.

    Kevin D

    Some earlier threads may be of help (covers “whose” capital as well as notional cap – CDs quoted):



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