Archive for March, 2009

Southwark v Austin: Request for information

Published
by
NL
on 30/03/2009
in Housing law - All, Succession, Tolerated trespasser and secure-tenancy
. 0 Comments

We’ve been contacted by the solicitor for Mr Austin of Southwark v Austin. There is to be an application for permission to go to the House of Lords (or Supreme Court? depending on timing, I suppose). As part of this, they’re looking for indicators of the scale of the issue involved in the case.

So the request is:

Please would anyone who has, or has had, a possession case acting for an occupier who would have been a successor tenant if the deceased (ex) tenant had not been a tolerated trespasser at death, contact the solicitor for Mr Austin, Charlotte Collins at charlotte.collins@anthonygold.co.uk (and I gather, the sooner the better.)

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Kay in the ECtHR

Published
by
J
on 30/03/2009
in Housing law - All
. 0 Comments

The Statement of Facts, together with the Question posed by the ECtHR is now online.

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New search tools

Published
by
NL
on 28/03/2009
in Various (non-housing)
. 0 Comments

The previous live search form that sat in the column to the right was getting a little creaky. The archives on this site are quite large now and it just wasn’t returning the results properly, and/or there were too many for it to handle adequately. Sometimes I couldn’t find what I was looking for, although I knew it was there.

So, I’m trying out some new search tools.

The search box to the right will return posts which contain all of the terms you put in, of any length, although not necessarily as a complete phrase. If you want the exact phrase, put it in quote marks “like so”. If there are more than one page of results, they are now easier to navigate.

The new ‘Advanced Search’ page – see the tab at the top of the site – will return results with the search terms highlighted and has an number of other ways to refine your search. The ‘help’ link on that page will tell you more. A couple of annoyances, though. It won’t search for terms less than 4 characters long, unless searched as ’string’; and you can’t specify the exact phrase with quote marks – although searching for the phrase as ’string’ is meant to return posts with the exact phrase only, it actually returns all posts which contain each word. The advanced search is still a distinct improvement, though, I think.

All comments, views and suggestions welcome.

By the way, the old Law Search google customised search page has been taken down. I hadn’t updated its database in a long time and it was far too general to be useful. So that has gone for good.

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If you missed it…

Published
by
NL
on 26/03/2009
in Housing law - All, assured-tenancy and secure-tenancy
. 0 Comments

There was a piece broadcast on Radio 5 live about illegal subletting, I think it was on last Sunday, 22 March. It is available as a podcast until Sunday 29 March here or can be played/downloaded as an mp3.

Many thanks to Ruth, the producer, for the link.

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A dutiful cousin

Published
by
Francis Davey
on 26/03/2009
in FLW case note, Housing law - All and Trusts and Estoppel
. 5 Comments

The House of Lords have again considered the nature and extent of proprietary estoppel in Thorner v Majors [2009] UKHL 18. Regular readers will recall we discussed their decision in Yeoman’s Row Management Limited (Appellants) and another v Cobbe (Respondent) [2008] UKHL 55 in August last year.

Picture this: a large farm in Somerset owned by Peter Thorner. Peter is a man of few words and very indirect in conversation. He might say to you “What are you doing tomorrow?” but what he would really mean is “Would you come along and help me tomorrow”. 

David Thorner was the claimant. His father was Peter’s cousin. David worked very hard for many years on Peter’s farm and was given to understand that he would inherit the farm on Peter’s death.

As you might expect Peter communicated this understanding in his typically terse and indirect way. For example in 1990 Peter handed David two assurance policies on his life saying “That’s for my death duties”. In context the trial judge found that this was a clear indication that David should inherit the farm.

The trial judge found that Peter had given an assurance that David would inherit the farm; it was reasonable for David to rely on those assurances and he had in fact done so to his detriment. That meant that there was a proprietary estoppel in David’s favour.

The Court of Appeal allowed an appeal on the principal ground that the trial judge had failed to make a finding that Peter intended David to inherit. David appealed and the matter to the House of Lords. The personal representatives of Peter’s estate took two further points: first that Peter’s representations were not sufficiently clear and unequivocal and second that over the many years during which David worked on the farm, some land was sold and other land acquired: there was therefore no identifiable property on which the estoppel could operate.

The House of Lords allowed David’s appeal. The view of Lord Walker (with which Lords Rodger and Neuberger agreed) was that assurance on which a proprietary estoppel is based only needs to be “clear enough”. What is enough will depend hugely on context. Such an assessment was best left to the trial judge and the Court of Appeal should not have tried to second guess his findings.

Lord Walker did not deal with the question of intention directly (although it is clear that in his view Peter’s subjective intention was not relevant). Lord Neuberger addressed the point directly: if the statements made by Peter were reasonably understood by David to be an assurance that he would have the farm and David acted reasonably in relying on them to his detriment, Peter’s subjective intention was “not really germane”. 

Otherwise where would all those reasonablys have come from?

On the question of the identity of the property, Lord Walker made a useful distinction between promissory and proprietary estoppel. Promissory estoppel is based on an existing legal relationship (such as a contract) whereas proprietary estoppel relates to land (either owned by or about to be owned by the person estopped). His Lordship adopted an explanation by Hoffman LJ (as he then was) in Walton v Walton that proprietary estoppel looks backwards from the moment when the promise falls due to be performed. Of course at that moment (Peter’s death) it was quite clear what the extent of the farm was.

The backward looking nature of proprietary estoppel also explains what would happen if Peter had sold the farm in his lifetime (perhaps in order to pay for medical expenses or out of a wish to resile from his promise as happened in Gillett and Holt [2001] 1 Ch 210). If Peter had tried to go back on his assurance, the court could look back from that moment and decide if an equity had arisen and how best to satisfy it.

Lord Hoffman elegantly encapsulated the backward looking nature of proprietary estoppel by quoting Hegel: “The owl of Minerva spreads its wings only with the falling of the dusk”. 

Lord Scott allowed the appeal but took a different path. His view was that proprietary estoppel is merely a species of promissory estoppel. Furthermore proprietary estoppel could only operate in situations (such as Crabb v Arun Distrinct Council) where there was a representation that the promissee would gain an immediate or more or less immediate interest in the property. His reasoning was that Peter’s assurances must have been conditional in the sense that he was able to freely deal with the farm (selling parts off though adding others). What if Peter had needed to sell the farm to fund nursing care at the end of his life? Surely (His Lordship seems to have assumed) Peter would have been free to do so. Thus Peter’s assurance was a conditional one and “it is an odd sort of estoppel that is produced by representations that are, in a sense, conditional”.

Instead Lord Scott felt that this was a case where a remedial constructive trust would be better deployed to do equity (and therefore justice). It would seem that a remedial constructive trust would result in the same outcome as that deduced by the other Lords of Appeal on the basis of proprietary estoppel. As a result Lord Scott also allowed the appeal.

I am quite unconvinced by Lord Scott’s approach. Proprietary estoppel is a very well established principle which allows a court to do justice where someone has reasonably relied to their detriment on assurances that they would have an interest in land. The equity can be satisfied in whatever way the court  looking backwards thinks best.

It seems to me that Lord Scott in classifying proprietary estoppel as a species of promissory estoppel is thereby forced to cut down its flexibility. That in turn forces him to look elsewhere for a means to do justice and he finds in the remedial constructive trust a mechanism for justice. Unfortunately the remedial constructive trust is a much less well understood tool for the English lawyer.

If its effects are much the same as those classically understood for proprietary estoppel, why use it? If not, what are the differences? It seems to me that a trust and an equity are different things and Lord Scott’s approach would be a difference of substance not merely of classification, but I cannot tell for certain.

The case contains some very useful and careful discussion of proprietary estoppel and is well worth reading if one finds oneself acting for Somerset farmers.

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Improvements, rent and former long leaseholders – a nasty loophole

Published
by
Francis Davey
on 25/03/2009
in FLW case note, Housing law - All, Leasehold and shared ownership and assured-tenancy
. 0 Comments

The recent case of Hughes v Borodex Ltd [2009] EWHC 565 (Admin) illustrates a pitfall that may face the very small number of former long leaseholders who have become assured tenancies as a result of the Local Government and Housing Act 1989 (“the 1989 Act”).

Mrs Hughes had been the tenant under a lease that was originally granted for a term of 39.25 years (less 3 days) on 25 March 1964. The tenancy was kept alive by the 1989 Act (which requires the landlord to serve a notice to bring most long residential leases to an end after the term has expired).

In due course the respondent landlord did serve a notice proposing that a new assured tenancy start on 28 February 2004. The rent was not agreed and a reference to the Rent Assessment Committee (“RAC”) was made under provisions of Schedule 10 of the 1989 Act. A rent was set at £1,668 per month.

The process by which an RAC assesses a new rent under Schedule 10 is very similar to that followed under s.14 of the Housing Act 1988 (“the 1988 Act”) with which some readers will be familiar. S.14(2) requires the RAC to disregard “relevant improvements” which are (subject to some conditions) improvements made by the tenant either under the tenancy in question or under some previous assured tenancy up to a maximum of 21 years before. The landlord should not get more rent because the tenant did the house up.

Schedule 10 imports most of s.14 but changes the definition of “relevant improvement” to mean any improvement carried out during the long residential tenancy. Just as one might expect.

The flaw in this neat scheme is that, under the new assured tenancy, the landlord may, in the course of time serve a s.13 notice to increase the rent. Any challenge to that rent will result in a determination under s.14 under which the RAC will not be able to take into account the improvements made by the tenant during the long lease.

This happened to the Claimant and a new rent of £2,340 per month was assessed by an RAC on 7 May 2008 now disregarding the Claimant’s improvements during the long tenancy. The new rent is of course sufficient to push the annual rent over £25,000 per year taking the Claimant’s tenancy outside the security of tenure in the 1988 Act.

Her statutory appeal against the RAC’s decision failed because the High Court found, as I have indicated, that there is no statutory provision to permit the RAC to consider her improvements. Various inventive arguments were offered in support of her appeal but as far as I can see it was doomed to fail.

This is a classic example of the kinds of personal tragedy and injustice that result when governments try to draft legislation in the messy and complex way that has been their usual practice in housing law for at least as long as I have been alive. The Claimant will suffer the consequences.

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A Weaver v L&Q interlude.

Published
by
NL
on 25/03/2009
in FLW case note, Housing law - All and assured-tenancy
. 2 Comments

While we wait for the Court of Appeal judgment in Weaver v London & Quadrant – the case was heard in the last week of February, I believe – we have a judgment along the way, specifically on Weaver’s application for a protected costs order (PCO). It is tempting to see this as something of a parable or synecdoche of the practical frustrations of bringing housing cases, and perhaps of the approach of certain large RSLs.

So, Weaver v London Quadrant Housing Trust [2009] EWCA Civ 235.

As all will recall, L&Q were declared to be a public body for the purposes of the Human Rights Act (and also judicial review) in the JR hearing, while Ms Weaver’s challenge to the Notice seeking Possession under Ground 8 and consequent possession order was dismissed. L&Q specifically requested that the finding that it was a public body be in the form of a declaration so that it could appeal, and appeal it did. The Equality and Human Rights Commission are seeking to intervene in the appeal, and had, at this point only permission to make written representations.

Ms Weaver was legally aided. On the appeal, the Legal Services Commission, in its infinite wisdom, decided that it would only fund Ms Weaver on condition that it would not be liable for L&Qs costs, of L&Q won the appeal. (Why on earth the LSC reached this conclusion when this would appear to be the very archetype of a case that has broader public interest and relevance is beyond me, but then much of the LSC’s decision making is beyond me).

If Ms Weaver was to proceed, she had to apply for a PCO to the effect that she (and the LSC) would not be liable for L&Q’s costs if they won. L&Q, for reasons best known to themselves, opposed the application.

It should be noted – particularly for future use – that it is open to the court when granting leave to appeal to set costs conditions, including, for example, that the costs of the appeal be wholly borne by the appellant, CPR 52.37. That did not happen in this case. No costs conditions were set, apparently because everyone assumed that the LSC would fund such a major case.

Now, we enter a strange parallel world [wobbly screen effect] of L&Qs grounds of opposition, a stance described by Elias LJ as possessed of ‘a considerable air of unreality’ [para 7] and by Toulson LJ as causing him to be ‘puzzled by what the Trust has hoped to achieve’ [para 17].

L&Q maintained that the application did not meet the criterea for a PCO as set out in R(Corner House Research) v SSTI [2005] 1 WLR 2600 at para 74.

To begin with, those rules applied to applicant (or appellants), whereas Ms Weaver was the respondent in this appeal. The Court of Appeal noted that this was an unusual case, where the Corner House principles would not precisely apply, but this was common law jurisdiction and open to development. There was no doubt that in principle an application for a PCO was open to a respondent.

In his skeleton, but not at the hearing, Christopher Baker for L&Q argued that if one had regard to the financial resources of the applicant and respondent, it was not necessarily fair and just to make the PCO, because L&Q was a charitable and non-profit making body. The Court noted that it was ’sensible’ that L&Q chose not to pursue that argument, give the evident disparity in financial resources.

L&Q then contended that Ms Weaver had a private interest in the outcome of the case, while Corner House restricts a PCO to those with no private interest. Pressed on what the private interest was, L&Q asserted that Ms Weaver would have the benefit of public law protection as an assured tenant. The Court of Appeal was not prepared to accept that this qualified as a private interest. In Goodson v HM Coroner for Beds & Luton [2005] EWCA Civ 1172, the Court accepted that a private interest that will apply to the population or a section of the population as a whole would qualify, and that was the case here. The appeal was being conducted in the public interest at the behest of the trust, not to assert the respondent’s private interest. The possession order would stand anyway.

In response to the Court’s concern that not making a PCO would result in the respondent have to take no further part in the case, and be acting reasonably in doing so, L&Q submitted that it was ‘not crucial that the applicant [Ms Weaver] be represented’ [para 14] as the divisional Court judgment set out the contending arguments in some detail. The Court of Appeal kindly avoided the obvious rejoinder – that in that case L&Q didn’t require representation either – and instead dismissed this out of hand. It was ‘important that this case be properly argued before the court’ and it is not an answer to say it could get by with the lower judgment [para 14]. In addition per Elias LJ:

There can be no doubt that this case is raising an issue of some public importance — of great importance, in particular, to the Trust. It is vital that there is proper representation for both sides before the court. If the claimant does not obtain the PCO that they seek, with the result that they are not represented before the court, then either the Equality and Human Rights Commission would have to take the burden of providing the necessary representation or the court would have to appoint an amicus. I have little doubt that if it had been appreciated when leave was granted that the court might have to appoint an amicus, permission would not have been granted on that basis. In any event it would now involve a delay to take the step. Perhaps the most important point is that, if either of those two bodies, the amicus or the intervenor, were to be running the arguments against the Trust in the appeal, then the Trust would, in any event, not be able to recover any costs against either of them [para 7]

Toulson LJ adds that:

The Trust might consider itself fortunate that it was not made subject to a condition requiring it to pay both sides’ costs of the appeal, since the appeal was being brought in order to establish a point of law of general importance to registered social landlords. [para 16]

Application for a PCO granted in terms that L&Q shall not recover any costs in the appeal against either the respondent or the LSC.

Is it just me, or is this not madness multiplied? – on the part of the LSC in the condition of its funding, certainly, and in then the extraordinary attempts by L&Q to oppose the application when, as the Court of Appeal points out, it was not going to gain anything, let alone the costs, in doing so. In fact, had L&Q been successful, thus requiring an amicus to be appointed, one imagines L&Q might well have faced a rather hostile court from the get go in the appeal hearing.

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Judicial Review costs

Published
by
NL
on 25/03/2009
in FLW case note and Housing law - All
. 0 Comments

Mendes & Anor v Southwark LBC (2009) CA (Civ Div) 24/03/09 [not on Bailii], is a useful case for those representing JR claimants. The report is on Lawtel.

Southwark had made an erroneous decision on Mr Mendes’ eligibility for housing assistance under Part VII. Mr Mendes applied for permission for judicial review. Before the matter went to hearing, Southwark conceded the error and that Mr Mendes was entitled to accommodation and Mr Mendes agreed to withdraw the JR by consent. At costs hearing, the Judge made no order for costs on the basis there was no good reason to award costs. Mr Mendes appealed.

Held: In this case Southwark had no answer to the claim as its decision was, as it conceded, wrong and it had applied the wrong test. The JR claim was not issued prematurely. It was clear Mr Mendes would have won the claim. The proceedings were compromised because the LA had reversed its decision and conceded the point. Costs were incurred reasonably and timeously. The Judge should have held there was no reason to make no order for costs. R (Scott) v Hackney LBC (2009) EWCA Civ 217 and R(Boxall) v Waltham Forest LBC (2001) 4 CCL Rep QBD (Admin) considered.

That is useful – a good clear statement that when the claim is conceded and the claim is properly brought, there has to be a reason for the claimant not to get costs.

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The end of tolerated trespassers delayed a bit.

Published
by
NL
on 24/03/2009
in Housing law - All, Tolerated trespasser and secure-tenancy
. 3 Comments

News just in – the government has announced that the date for the implementation of s.299 H&R Act 2008 – which brings in ‘replacement’ tenancies has been delayed from 6 April 2009, when we thought it was going to happen, to ‘early May’. This is apparently so that the Order on successor landlords can be scrutinised by Parliament and come into force at the same time. More detail on the successor landlords order and implementation dates to follow as and when.

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Now this is interesting…

Published
by
J
on 23/03/2009
in Housing law - All and Mortgage possession
. 4 Comments

The Observer had a very interesting article yesterday, which can be found here.

It concerned the complaint by Andrew Brown (not his real name) to the Financial Ombudsman Service. Mr Brown was a tenant of a housing association who was persuaded by a mortgage adviser to take out a mortgage and purchase the property (presumably under the terms of a preserved RTB). The mortgage had an attractive initial rate and then (can you tell what it is yet?) the interest rate shot up. Mr Brown was unable to service the debt and was ultimately repossessed.

The article suggests that he then complained to the FOS, arguing that the mortgage adviser had broken the Mortgage and Home Finance: Code of Business by failing to ensure that the mortgage was “suitable for the customer” and, more importantly, that the FOS found in his favour. The issue of compensation remained to be decided.

The facts of this case aren’t going to be a surprise to readers of this blog. There is copious evidence, both published and anecdotal, about the behavior of “off-high street” mortgage companies. I doubt that many people will go all the way to a complaint to the FOS (although, in the current market, who knows) but this does seem to present interesting new opportunities for defending possession proceedings. I know very few people who actually run arguments based on the MCOB, as they’re generally regarded as window-dressing for the industry but, perhaps, this might be about to change.

I have requested a copy of the decision from the FOS but, as yet, have not had a response. If any of you have a copy already, please do let us know.

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