Good morning

My latest landlord referral has been revised in the claimant’s favour, avoiding the need for Tribunal proceedings with a backdate of £10K to March 2025.

While that outcome is welcome, the original refusal was the product of a flawed decision‑making culture within Universal Credit, not a failure of entitlement. The claim should never have been refused; the claimant’s parents had given up trying until the father, by chance, Googled one of my members’ bulletins.

A presumption against family tenancies

The refusal reflects the DWP’s tendency to refuse close family tenancy agreements, even though there’s nothing immoral or illegal about them, and they’re invariably created by necessity to fill a void in the local authority’s inability to provide a solution. Rather than applying the statutory tests lawfully and objectively, in practice, Universal Credit decision‑makers too often assess such cases from a negative standpoint, looking for reasons to refuse, rather than assessing the evidence objectively.

In this case, the claimant is a 40‑year‑old man with long‑standing mental health conditions, who has occupied the same property for many years under a genuine tenancy agreement with a close family-related landlord. Before he migrated to Universal Credit in March 2025, his local council paid Housing Benefit, relying on the same tenancy agreement. There was no change in liability, no change in occupation, and no change in the commerciality of their agreement. The only thing that changed was the decision- maker – DWP!

Decisions without reasons are becoming the norm

Even more concerning than the refusal was the way it was communicated. The case highlights a growing pattern within Universal Credit of making disallowances without any notification or issuing decisions without sufficient reasons, often through brief journal entries that state a conclusion but provide no explanation, e.g. “your housing costs have not been approved”. Such communications fail to comply with social security-related decision-making requirements.

In PP v SSWP (UC) [2020] UKUT 109 (AAC), the Upper Tribunal confirmed that:

  • A claimant cannot be held to have been notified of a decision unless a proper, legally compliant notice has been issued.
  • Brief journal messages or informal contact by DWP staff do not amount to proper notification. {see paras 24 & 25}
  • Without proper notification, the claimant’s MR request must be accepted and treated as timely.

A decision that merely states an outcome, without reasons, is not just poor practice—it is legally defective. Reasons are not optional, they are fundamental to fairness, transparency, and the claimant’s ability to challenge an adverse decision.

Mandatory Reconsideration in name only

The same pattern continues at the Mandatory Reconsideration (MR) stage. Despite a clear legal requirement for written MR Notices, it has become increasingly common for DWP staff to rely on a brief note on the journal or an informal telephone call, with no proper written decision issued. That approach strips claimants of their procedural rights and frustrates effective challenge to the First-tier tribunal as the Tribunal Service insists on receiving an MR Notice with any appeal submitted.

In this case, the original UC response failed to explain which of the three legal tests for entitlement had not been satisfied:

  • Occupation of the dwelling as the claimant’s home?
  • Liability to make payments?
  • Whether the liability was not on a commercial basis?

In my view, there should have been no dispute on the evidence that all three were satisfied, as the claimant had resided for years, paid his rent without fail, and the AST agreement had been accepted as creating a commercial tenancy by the local council.

Why was the case revised?

The decision was ultimately revised not because Universal Credit identified its own errors, but because it was confronted with a detailed, evidence‑based, challenge that exposed both the substantive and procedural unlawfulness of the refusal.

That is a worrying indictment of the current system. It suggests that outcomes increasingly depend not on entitlement, but on whether a claimant is able to marshal specialist knowledge (e.g. Welfare Rights, Financial Inclusion officers), persistence, and representation. Many will not be able to do so, and unlawful refusals will stand uncorrected as a result.

For landlords who rent to family members, and for benefit advisers supporting tenants, the message is clear: entitlement alone is no longer enough. Decisions must be actively defended, evidenced, and—where necessary—pursued via the 2-stage appeal mechanisms (MR & Appeal) explained in this article.

Regards

Bill Irvine

Tel: 07733 080 389

www.ucadvice.co.uk