Social security

Compensation payment - periodic payments under structured settlement - treated as income for purposes of entitlement to income supportBeattie v Secretary of State for Social Security: CA ( President Dame Elizabeth Butler-Sloss, Lords Justice Pill and Jonathan Parker): 9 April 2001The claimant compromised an action for damages for personal injury in October 1992 by a structured settlement which provided, among other things, for regular monthly payments to the Court of Protection receiver of a specific amount, with a minimum of 120 payments regardless of the date of death of the claimant.

On appeal from a determination that the claimant's entitlement to income support had ceased, a social security commissioner held that, since the status of the annuity payments for income support purposes was conclusively determined by regulation 41 of the Income Support (General) Regulations 1987, income utilised on the claimant's behalf from annuities received by him under a structured settlement, and income from a contingency fund held at the Court of Protection, was to be treated as income for the purposes of the determination of the claimant's entitlement to income support pursuant to the 1987 Regulations and the Social Security Contributions and Benefits Act 1992, with the result that the claimant had ceased to be entitled to income support from that time.

The claimant appealed.William Braithwaite QC and Louis Browne (instructed by Meloy Whittle Robinson, Preston) for the claimant.

Nathalie Lieven (instructed by the solicitor, Department of Social Security) for the secretary of state.Held, dismissing the appeal, that under regulation 41 of the 1987 regulations any capital payable by installments and any payment received under an annuity were treated as income; that the structured settlement arrangement was a typical example of an annuity, falling squarely within regulation 41(2); so that payments made under a 'structured settlement' damages award affected a claimant's entitlement to income support.