If a tenant on a statutory periodic tenancy stops living in the property, but the tenancy is not ended, who is liable for the Council Tax?
CT v Horsham District Council (HB)  UKUT 617 (AAC)
This was an appeal to the Upper Tribunal from the benefits First Tier Tribunal. It was actually an appeal on Council tax Benefit eligibility, but has considerable significance for Council tax liability of (non-resident) tenants.
The Claimant had been an assured shorthold tenant since 1997. By at least February 2008, the tenancy had become a statutory periodic tenancy (probably back in 1997/8 as there do not appear to have been any ‘renewal’ tenancies.) She did not live in the property from August 2008, but the tenancy was not ended until February 2010.
The issue was the period between August 2008 and Feb 2010 when an alleged overpayment of CTB had taken place.
At the UT, the Council argued that th Claimant was ‘the owner’ of the property for the purposes of s.6 Local Government Finance Act 1992 even if not resident:
the interest which the Claimant had under her periodic tenancy was a “material interest”, as it had originally been granted for a term of six months or more. In that case there appears to have been an initial grant of an assured tenancy for a term of six months, followed by a periodic assured tenancy arising under the 1988 Act, followed when the tenant ceased to reside in the property by a periodic tenancy which was not an assured tenancy. The Tribunal held, contrary to the council’s contention in that case, that the periodic tenancies were “a continuation of the original agreement and not three separate and different agreements and it therefore followed that the tenant had a material interest …”
This was in reliance on a Valuation Tribunal decision in Oyston v Leeds City Council (27 July 2011) [Which I think is this one]
However, the Upper Tribunal preferred the argument in found in a summary of MacAttram v London Borough of Camden  EWHC 1033 (I have seen a transcript of judgment in this case, but it doesn’t seem to be generally available and the UT hadn’t seen it).
That case, which also concerned council tax liability, dealt with a contractual tenancy for LB Camden for a period of 3 years, after which Camden continued to use the property to house homeless appliance and continued to pay rent, on a monthly basis, as was originally required under the lease. The High Court accepted that a new monthly periodic tenancy had arisen at the expiry of the fixed term of the contract (though why not a tenancy at will is not clear, but of no relevance).
Section 6 of the Local Government Finance Act 1992 provides for liability for council tax to fall on the first applicable person on the following list:
(2)A person falls within this subsection in relation to any chargeable dwelling and any day if, on that day–
(a)he is a resident of the dwelling and has a freehold interest in the whole or any part of it;
(b)he is such a resident and has a leasehold interest in the whole or any part of the dwelling which is not inferior to another such interest held by another such resident;
(c)he is both such a resident and a statutory or secure or introductory tenant of the whole or any part of the dwelling;
(d)he is such a resident and has a contractual licence to occupy the whole or any part of the dwelling;
(e)he is such a resident; or.
(f)he is the owner of the dwelling.
So, if there is no person resident, liability falls on ‘the owner’.
Sections 5 and 6 provide:
(5)In this Part, unless the context otherwise requires–
‘owner’, in relation to any dwelling, means the person as regards whom the following conditions are fulfilled–
(a)he has a material interest in the whole or any part of the dwelling; and.
(b)at least part of the dwelling or, as the case may be, of the part concerned is not subject to a material interest inferior to his interest;
(6)In this section– …
‘material interest’ means a freehold interest or a leasehold interest which was granted for a term of six months or more.”
Thus for the ‘owner’ to avoid liability, there has to be someone with an inferior material interest to be classed as the ‘owner’. But a material interest has to be effectively a tenancy with a term of 6 months or more.
A monthly periodic, the High Court held, was not a material interest. Therefore Camden were not liable for the council tax for the period after its contractual term. Further the periodic tenancy was a new tenancy and not a ‘continuation’ of the original contractual term:
The whole premise of the inference of a periodic tenancy which arises after expiry of a fixed term by virtue of the payment and acceptance of rent is that by their conduct the parties are taken to have agreed to ￼￼￼￼enter into a tenancy. Although the relationship of landlord and tenant continues, the agreement between them is not one of continuation of a previous fixed term that has expired, rather it is the commencement of a new and different term of years, a monthly periodic tenancy. Although that tenancy is on the same terms and conditions as the previous lease, that again is based on an inference from the party’s conduct. Those previous terms only apply insofar as they are not inconsistent with the terms of the new and different tenancy, namely the monthly periodic tenancy.
(This is in relation to a contractual tenancy, so not on the wording of Housing Act 1988, as in Superstrike)
The principle in Gandy v Jubber (1865) 9 B & S 15, that a yearly periodic tenancy “becomes an entire lease certain for the years past and also for the year so entered on, and that it is not a reletting at the commencement of the third and subsequent years”, did not apply as s.6 of the 1992 Act specified a lease ‘granted’ for more than 6 months, not one granted on a monthly basis that cumulatively became a lease for longer than 6 months.
Thus the High Court in MacAttram. As mentioned above, the Upper Tribunal apparently did not have these details, or the transcript of MacAttram. In fact it isn’t clear whether the UT had appreciated that MacAttram did not concern an assured shorthold tenancy. But given Superstrike, it is unarguable that a statutory periodic is not a new periodic tenancy of less than 6 months.
So, the Upper tribunal held that the tenant is not liable for Council Tax as ‘owner’ if they are on a statutory periodic tenancy (or any tenancy of a term of less than 6 months) and are non-resident. The liability will fall on the next ‘owner’ up the chain with a material interest and a longer than 6 month term. usually, the landlord.
The Claimant in this case was found not to have received an excess of CTB. Unfortunately, that was because she had no council tax liability and should have received no CTB at all.
As far as I can see, this should also apply to any secure or assured social tenant on a weekly or monthly periodic tenancy. Once they are no longer resident, even if the tenancy continues (as a contractual tenancy or otherwise) they are not liable for Council Tax, but the landlord is.