Author Archive for J

Enforcing Postponed Possession Orders

Published
by
J
on 14 November 2008
in Housing law
. 1 Comment

LB Wandsworth v Whibley [2008] EWCA Civ 1259.

If a postponed possession order is made and the landlord takes the view that the conditions of postponement have been broken, the application for a date for possession should be conducted on a summary basis and only on the basis of evidence submitted by the landlord… or so argued LB Wandsworth in this case. Unsurprisingly, they lost.

Mr Whibley is the secure tenant of LB Wandsworth. He was a man who cultivated and used cannabis and who had been convicted of the same. LB Wandsworth sought possesson of his property on the basis of his drug convictions and some minor rent arrears. In due course, after trial, a postponed possession order was made. For some reason (likely an administrative error on the part of the court) the PPO only referred to payment of rent and not to any conditions to do with the nuisance.

A few months after the possession order was made, Wandsworth received further complaints about the behaviour of Mr Whibley. The solicitor for Wandsworth wrote to him giving details of the complaints and asking for a response within 7 days, in particular, detailing whether or not he disputed the right of the council to seek to fix a date for possession.

Mr Whibley did not respond himself but, very sensibly, engaged Flack and Co, who informed Wandsworth that the allegations were disputed (in the interests of full disclosure, William Flack is a regular commentator on this blog and is a friend of NL).

Wandsworth then applied to the county court to fix a date for possession. They included a witness statement in support of their application but did not provide the court with a copy of the letter from Flack and Co. (Although nothing ultimately turned on that point, that strikes me as particularly sharp practice). They later added rent arrears as a second reason for seeking to fix a date.

Mr Whibley cross-applied, seeking to adjourn the hearing with directions or, alternatively, for any warrant to be suspended. It was made clear that he denied responsibility for any nuisance and that, on his case, the nuisance was caused by unwanted and uninvited ‘guests’ who had taken over his flat.

The DJ who heard the applications did not give possession as Wandsworth sought, but instead varied the original possession order so as to record the condition of postponement as regards nuisance and then gave directions. He did, however, give Wandsworth permission to appeal. Wandsworth accepted that invitation and appealed to the Circuit Judge. Their stated intention (both before the CJ and the CA) was to:

Secure a ruling that, save in quite exceptional cases… county courts should give summary judgment without hearing evidence on applications to set a date on a postponed possession order [10]

The Court of Appeal had no difficulty in disposing of this argument. Whilst it is possible to deal with rent arrears cases in this way, that is only because rent arrears are (usually) a matter of record. This was not (usually) the case in nuisance cases, where the conduct was often disputed. That being so:

It is not permissible for a tenant who has a possible answer to lose his or her home unheard [12]

The nature of any such hearing (the necessary directions etc) would vary from case to case, and courts would be alive to ensuring that nuisance tenants did not abuse this process, but the process still had to be fair to both sides. A summary procedure could not possibly be fair if there was any room for dispute about the factual allegations made by the landlord.

Wandsworth had relied on Southwark v St Brice [2001] EWCA Civ 1138 for the proposition that a landlord should not have to prove matters twice. However, as the Court of Appeal pointed out, that was not what would happen in a PPO. The landlord was alleging fresh breaches of the terms of the postponement. It should have to prove them in the usual way.

Of course, if a tenant did not dispute the allegations (whether to do with rent, nuisance or anything else) then a court could properly consider the matters on the papers and proceed in a summary fashion, but that was not the case here. Appeal dismissed.

Sometimes, you just feel like weeping. Social landlords do, in my view, have a very important role to play in progressing the law and in advancing the best arguments that they can. They can and should push the law where they see fit. But this argument was nothing of that sort. This just seems petty and vindictive.

Pour encourager les autres

Published
by
J
on 14 November 2008
in Housing law
. 0 Comments

Webb v Wandsworth LBC (Court of Appeal, November 12, 2008, extempore judgment and only noted in Arden Chambers Eflash 328)

Ms Webb was the secure tenant of LB Wandsworth. Between 2005 and 2006 her son was involved in a number of serious criminal and anti-social acts in the local area. In response, Wandsworth issued possession proceedings relying on Grounds 1 and 2, Sch. 2 Housing Act 1985. Shortly thereafter, an ASBO was made against the son. The son subsequently left the family home, although he would regularly return to visit his mother.

The possession trial came on in October 2007. There had been no ASB for a year and the son had been living elsewhere for 8 months. The Judge made a postponed possession order, apparently taking into account the fact that the son had been charged (but acquitted) of three breaches of the ASBO.

Ms Webb appealed to the Court of Appeal and contended that the three acquittals were irrelevant considerations. The Court unanimously upheld her appeal and quashed the possession proceedings. It was wrong in principle to take those matters into account.

Sedley LJ has, apparently, gone further and in his judgment, has stated that it is not permissible to use a possession order as a means of trying to force a tenant to exercise control over a third party.

It is, as you might imagine, the comments of Sedley LJ that appear to be the most interesting. I defend a fair few ASB cases and one of the things which most frustrates me is seeing my clients being demonised for the actions of their children/(drunken) partners. At a personal level, I hope the transcript of this judgment is as promising as the Eflash suggests it will be.

It’s the end of the world as we know it

Published
by
J
on 11 November 2008
in Housing law
. 5 Comments

Housing Minister Margaret Beckett dropped a bit of a bombshell yesterday.

The Government has (according to leaks in the Times) responded warmly to a CIH proposal to end secure and assured tenancies as we know them and replacing them with fixed term contracts which are reviewed every 3 or so years. The idea would be that, if, at the end of the review period you’re financially able to survive in the private sector (whether as a renter or a owner-occupier) you should be required to do so. In effect, social housing becomes a temporary stop-gap for people, save for those who are too vulnerable to survive in the private sector. The concern underlying this announcement is to try and get more people who are owed the full Part 7, Housing Act 1996 duty into accommodation.

Another Green Paper is promised in due course, where this proposal will be (one suspects) fleshed out. I wonder if another option might be to allow local housing authorities to build more houses?

More information from the BBC here and Inside Housing here.

Housing and Human Rights: Kay in the ECtHR

Published
by
J
on 5 November 2008
in Housing law
. 4 Comments

From the Garden Court bulletin:

The ECtHR has invited the observations of the UK government on the application made by Mr Kay to the ECtHR, following his defeat in the House of Lords in Kay v LB Lambeth [2006] UKHL 10. The Court has asked for observations on the question of whether or not Mr Kay had “the opportunity to have the proportionality of [his] eviction… determined by an independent tribunal in light of the relevant principles under Article 8.”

We’ll all need to keep an eye on this one!

ASBOs for all!

Published
by
J
on 31 October 2008
in Housing law
. 2 Comments

Birmingham City Council v (1) Shafi (2) Ellis [2008] EWCA Civ 1186

This is a complicated case, focusing much more on local government law than on housing law per se, but there are some significant implications for housing lawyers. We’ve already had one request to blog this case and I hope you’ll see why.

Section 222(1)(a) of the Local Government Act 1972 confers on local authorities in England and Wales the right and power to “prosecute or defend or appear in any legal proceedings and, in the case of civil proceedings… [to] institute them in their own name.” One of the effects of this is to allow a local authority to seek injunctive relief in circumstances where, prior to 1972, the Attorney General had exclusive jurisidiction to do so. In practice, the Attorney (and local authorities) tend to use that power in two distinct categories:

(a) to seek an injunction in aid of the criminal law;

(b) to prevent a public nuisance.

See, by way of example, Stoke-on-Trent City Council v B&Q Retail [1984] 1 AC 754 (an injunction in aid of the criminal law to prevent unlawful Sunday trading) and Nottingham City Council v Zain [2001] EWCA Civ 1248; [2002] 1 WLR 607 (an injunction to prevent a public nuisance caused by an alleged drug dealer).

During summer 2007, Birmingham City Council, together with the West Midlands Police and West Midlands Probation service, launched a concerted legal campaign against what they contended were dangerous criminal gangs operating in their area. They sought ASBOs against those alleged gang members who were under 18 and s.222 injunctions against those who were over 18. The orders were broadly similar in all cases in that they sought to prevent the defendants from entering large parts of Birmingham; meeting certain named individuals or carrying out acts of violence. Sometimes (as in this case) additional clauses were sought so as to prohibit the wearing of clothing of a certain colour (said to be the colour of the gang) or being in any group larger than two.

At trial, HHJ Macduff QC (as he was then, now Macduff J) accepted the broad thrust of the council’s case on the facts. He found that there were such gangs operating in Birmigham and that they had engaged in violent, criminal activity. He found that both defendants were members of one such gang, although he did not find that the defendants themselves had acted in a criminal or violent manner.

He rejected the applications for the injunctions. He found that there was a complete code to deal with anti-social behaviour and that code was contained in the Crime and Disorder Act 1998. He found that the availability of the ASBO as a remedy meant that he no longer had jurisdiction to make an injunction under s.222. If he was wrong about that, he went on to hold that, before he would make any injunction, he would require it to be proved, to the criminal standard of proof, that the individual defendants had themselves acted in a criminal or violent manner. He granted the council permission to appeal on all points.

The Court of Appeal dismissed the appeal. The Judge had been wrong to see the question as one of jurisdiction. However, he had been right to focus on the availability of the ASBO as an alternative remedy. Parliamant had, in enacting the Crime and Disorder Act 1998, created a self-contained code for dealing with ASB. It contained checks and balances and had a detailed body of case law. The common-law powers of the local authority, through the vehicle of s.222, should not be used, save in exceptional cases. It would be wrong in principle (save in exceptional cases) for a court to grant an injunction where the subject matter of the complaint or the terms sought could be adequately dealt with by an ASBO.

The Court of Appeal then divided (Rix LJ and Clarke MR for the majority, Moore-Bick LJ in the minority) on the standard of proof to be applied in those exceptional cases where an injunction might be appropriate. The majority thought that the Judge was right to require a criminal standard of proof, by analogy with the ASBO regime. The minority felt that this would introduce uncertainty into the law dealing with all injunctions as it was impossible to categorise local authority injunctions against criminal or nuisance behaviour as a discrete category of injunction.

There is a general point here for housing lawyers. Why does this logic not hold good for ASBIs under ss153A-E? They have the same characteristics as s.222 injunctions. If s.222 is not to be used where an ASBO might be available, why should an ASBI be any different? If an ASBI is to be used then, if an ASBO would have been available, surely, as a minimum, the standard of proof should be the criminal standard.

Birmingham have indicated that they intend to petition the House of Lords.

Varying an ASBO - an (un)appealing option

Published
by
J
on 31 October 2008
in Housing law
. 1 Comment

We here at NL still haven’t decided how much ASB law to cover on the blog. On the one hand, only possession proceedings and s.153A-E Housing Act 1996 injunctions could be said to be ‘true’ housing law. But, on the other, ASB remedies are, to a very significant extent, conferred on public sector landlords, with the clear implication that they’re to be used as one of the range of remedies against/for the benefit of ones own tenants. If readers have any strong views about whether we should include more or less ASB cases, please let us know. We can’t guarantee to blog everything, but it’d be interesting to know what you want to read about.

Ashley Langley v (1) Preston Crown Court (2) West Lancashire DC (3) The Secretary of State for Justice [2008] EWHC 2623 (Admin) concerns the routes of appeal from an order varying an ASBO.

The claimant, Ashley Langley, was made subject to a “stand alone” ASBO under s.1(1) Crime and Disorder Act 1998 in February 2004. It was to run until 19 August 2007. On 17 August 2007, West Lancashire DC applied to vary the order, so as to extend it for another two years. This application was granted by the Chorley Magistrates’. They found that Mr Langley had been convicted of a number of breaches of the original ASBO and that he had been convicted of an offence of violence. The order was necessary to protect the community.

Mr Langley appealed to the Crown Court against that variation. The issue was whether or not the Crown Court had jurisdiction to hear the appeal.

There was no doubt that, in the magistrates’ court,  there was an automatic right of appeal against the making of an ASBO, whether that ASBO was interim or final, (s.4(1) Crime and Disorder Act 1998), but the position as regards a variation of an existing order was less clear.

The Divisional Court held that:

(a) an ASBO which was made by and varied in the county court could be appealed to the High Court or Court of Appeal, as appropriate and with permission; (CPR 52)

(b) an ASBO made on conviction in and then varied by the Crown Court could be appealed to the Court of Appeal (Crminal Division), but only with the leave of that Court; (ss9 and 50 Criminal Appeal Act 1968)

(c) an ASBO made in the magistrates’ court (whether on conviction or a free standing application) and then varied cannot be appealed to the Crown Court. The defendant can only seek judicial review or to have a case stated.

The common feature of all the routes of challenge was that they did not permit a re-hearing on the facts, but were confined to errors of law. This did not even come close to amounting to a violation of Art. 6.

It would be an abuse of process, save in the most exceptional case, to attempt to get around these restrictions by seeking to appeal the original ASBO out of time.

The point that this case does not deal with (and, to my mind, the far more important point) is the different appeal rights from the making of the ASBO. In the magistrate’ court, a stand alone ASBO is subject to an automatic right of appeal to the Crown Court for a complete re-hearing. In the county court, one needs permission to appeal and the appeal will usually be confined to a point of law. Given that the ASBOs have the same effect in each case, this difference is hard to explain or justify.

Taking your time

Published
by
J
on 27 October 2008
in Housing law
. 0 Comments

Yorkshire Bank Finance Ltd v Mulhall & anor [2008] EWCA Civ 1156

How long does a creditor who has the benefit of a charging order have to enforce that charge? In particular, if a creditor allows more than 12 years to pass after securing the charging order, can the debtor apply to have it set aside?

Mr & Mrs Mulhall had provided a guarantee to the bank in respect of some company borrowings. The company defaulted and the bank sought to enforce the guarantee. Judgment in default was obtained, followed by interim and final charging orders. The final order was made on 25 June 1991.

In January 2007, Mrs Mulhall applied to set aside the charging order. One of her arguments was based on the failure of the bank to take any steps to enforce the order for c.16 years. The Deputy District Judge and Circuit Judge both dismissed her application, but permission for a second appeal to the Court of Appeal was given Mummery LJ.

Her argument was based on s.20(1) Limitation Act 1980. This provides that “no action shall be brought to recover… any principle sum of money secured by a mortgage or other charge on property… after the expiration of 12 years from the date on which the right to receive the money accrued.” The right to the money had accrued, at the latest, when the final charging order was made.

The Court of Appeal disagreed. Section 20(1) did not apply to charging orders and, by analogy with Ezekiel v Orakpo [1997] 1 WLR 340, there was no limitation period for the enforcement of charging orders.

I know at least one other member of the NL team has come across creditors seeking to rely on ‘old’ charging orders, so this decision from the Court of Appeal does at least give us a clear answer. Shame about the result though.

Second time around

Published
by
J
on 23 October 2008
in Housing law
. 0 Comments

Truro Diocesan Board of Finance Ltd v Foley [2008] EWCA Civ 1162

In March 1987 Mr Foley became the tenant of a property owned by the predecessor in title of the Board. In 2000, the Board sought possession of the property. They contended that Mr Foley was a protected shorthold tenant (within the meaning of s.52 Housing Act 1980). Mr Foley resisted the proceedings and contended that he was in fact a Rent Act tenant.

The proceedings were settled on 20 September 2001. It was agreed that Mr Foley was a protected shorthold tenant. It was further agreed that Mr Foley would give up possession of the property within 6 days, spend a minimum of 24 hours out of possession and, on 27 September 2001, that he would be granted an assured shorthold tenancy of the same property. That assured shorthold tenancy would be for a fixed term of 5 years. This agreement was contained in a deed. Mr Foley duly gave up possession.

In April 2006, the Board served a notice under s.21 Housing Act 1988, seeking possession on the last day of the five year term. Mr Foley again defended the proceedings and, again, claimed that he was a Rent Act tenant. His defence failed in the county court and he appealed to the Court of Appeal.

Mr Foley argued that in general terms, it has not been possible to create new Rent Act tenancies since 15 Jan 1989, when the assured tenancy provisions of the Housing Act 1988 came into effect. However, this general rule is subject to exceptions. One of those exceptions is found in s.34(1)(b) Housing Act 1988. That provides that:

(1) A tenancy which is entered into on or after the commencement of this Act cannot be a protected tenancy unless…

…

(b) it is granted to a person… who, immediately before the tenancy was granted, was a protected tenant or a statutory tenant and is so granted by the person who at the time was the landlord… under the protected or statutory tenancy

Mr Foley relied on s.45 Housing Act 1988. This provides that, except where the context otherwise requires, a tenancy includes an agreement for a tenancy. Hence, the settlement order of 20 September 2001 was, actually a grant of a new tenancy and, by virtue of s.34(1)(b), it was a protected tenancy.

The Court of Appeal, with some reluctance, did not accept this argument. They took the view that the “context otherwise require[d]” that, in s.34, a tenancy could not include an agreement for a tenancy. The language of s.34 as a whole suggested that it was dealing with tenancies which had actually been granted and not merely agreed.

Mr Foley had a second string to his bow though. He argued that the settlement of 20 September 2001 was itself a tenancy, following Walsh v Lonsdale (1882) 21 Ch D 9. At this time, he satisfied the requirements of s.34(1)(b).

The Court of Appeal was similarly reluctant to reject this argument, but reject it they did. One had to consider the actual intentions of the parties at the time that they entered into the settlement on 20 September 2001. They intended that the new tenancy arise on 27 September 2001, not 20 September 2001. Hence this point failed as well.

Mr Foley then sought to argue that the 24 hours between the surrender of his old tenancy and the grant of his new tenancy were irrelevant when considering whether or not “immediately before the [new] tenancy was granted” he was a protected tenant. The Board relied on Dibbs v Campbell (1988) 20 HLR 374 and Bolnore Properties Lrd v Cobb (1996) 29 HLR 2002, as authority for the proposition that the 24 hr break between the tenancies was sufficient to mean that the new one did not follow immediately after the old one. Again, the Court of Appeal rejected Mr Foley’s argument (albeit by 2 to 1 - Sir John Chadwick dissented on this point).

The Human RIghts Act 1998 did not help him either. Kay v Lambeth LBC [2006] 2 AC 465 made clear that it was only an exceptional case where domestic law would not provide sufficient protection for Art. 8 purposes. Although Kay was about social housing, the logic applied equally to the private sector. McCann v UK (App. No. 19009/04) took matters no further and, in light of the criticism of that case by Lords Scott and Hope in Doherty v Birmingham CC [2008] UKHL 57, it added nothing to the general law as set out in Kay.

So - a clean sweep for the Board. There probably isn’t much of lasting value in this case - the facts are so unusual and there are so few protected tenants left. However, the discussion of Kay, Doherty and McCann might have some wider impact. This was the first time that the Court of Appeal grappled with Doherty and they’ve clearly decided that it adds nothing to Kay. Landlord lawyers will no-doubt seize on paras 33 and 34 to do down human rights arguments but I don’t think anyone would seriously contend that this is the end of the road for McCann based arguments.

Andrew Arden QC and Iain Colville, instructed by Michelmores LLP for the Board

David Watkinson, instructed by Cartidges for Mr Foley

Mortgages, sale of property and human rights

Published
by
J
on 12 October 2008
in Housing law
. 6 Comments

Horsham Properties Group Ltd v (1) Paul Clark (2) Carol Beech and GMAC RFC Ltd (Third Party) and The Secretary of State for Justice (Intervener) [2008] EWHC 2327 (Ch)

Now this is a complicated little case which, I suspect, will give rise to more questions (and litigation) than it answered.

Mortgages: a very short introduction

Prior to 1970, if A granted B a mortgage over A’s land then, unless the mortgage contract provides otherwise, B was entitled to recover possession of it at any time. There is no need for A to default under the terms of the contract or do anything like that. B’s right to possession arose immediately and the court had no power to refuse B’s claim for possession, save for a very limited discretion to adjourn to allow A to sell the property or otherwise raise the money to pay off the mortgage - see, for example, Citizens Permanent Building Society v Caunt [1962] Ch 883.

This, as will be immediately apparent, is not a good thing. Unless borrowers could negotiate some contractual protection, it left them at the mercy of (unscrupulous) lenders and it made a mortgage a very unattractive method of financing the purchase of property. The Payne Committee of 1968 recommended giving the court powers to adjourn or suspend possession proceedings on terms relating to the repayment of the mortgage by installments.

This report gave rise to the Administration of Justice Act 1970 (and, indirectly, the Administration of Justice Act 1973.) The effect of those Acts is that, in respect of residential property, where possession is sought by a lender, then the court has the power to suspend the possession order on terms that the defendant pay the mortgage plus a sum off the arrears. The court has a very wide discretion at this stage and should ask itself whether the arrears can be repaid over the remaining term of the mortgage (see Cheltenham & Gloucester Building Society v Norgan [1995] EWCA Civ 11). In practice, this is the most significant right available to borrowers who find themselves in financial difficulties and, in most cases, is sufficient to keep a borrower in their home.

The facts

Mr Clark and Ms Beech had purchased a property with the benefit of a loan from GMAC, which was secured on the property as a mortgage in the usual way. During the course of the mortgage, Mr Clark and Ms Beech fell into arrears.

The mortgage provided that, if the mortgage fell into arrears, GMAC could appoint a receiver, which they duly did. Then, again pursuant to the mortgage contract, the receiver sold the property at auction. (Although GMAC appeared to be relying on their contractual powers, it should be noted that s.101 Law of Property Act 1925 would have provided another way of achieving a similar result. This becomes important later on.)

The property was purchased by Horsham Properties Group Ltd (”Horsham”).

At this stage (a) the sale of the property had raised sufficient monies to discharge the mortgage and (b) Mr Clark and Ms Beech were still in occupation of the property.

Having purchased the property, Horsham then issued trespasser proceedings against Mr Clark and Ms Beech, seeking to recover possession of the property. The effect of this was to bypass all the protections contained in the Administration of Justice Acts, something which had been found to be perfectly lawful by the Court of Appeal in Ropaigealach v Barclays Bank [2000] QB 263.

The arguments

Ms Beech argued that the Ropaigealach decision had to be re-examined in light of the Human Rights Act 1998. In particular, she argued that:

(a) the power to appoint a receiver and / or sell the property should be interpreted as arising only once the court had sanctioned such a step; or

(b) the protection of the Administration of Justice Acts should continue to apply even where the claim for possession is brought by someone who has purchased the property from a mortgage company.

She framed these arguments in the light of Article 1 of the First Protocol (”A1P1″) to the European Convention on Human Rights (right to peaceful enjoyment of possessions) and argued that, if they were rejected, there should be a declaration of incompatibility.

The decision

The Court (Briggs J) had no difficulty in accepting that, in losing the right to pay off the mortgage, one had lost a “possession” within the meaning of A1P1. However, he did not find that there had been any deprivation of that possession by the State. He gave two reasons for this:

(a) the current situation had arisen because of the contractual provisions (and an admitted default by Mr Clark and Ms Beech) and not because of any State action; however

(b) the position would have been no different if GMAC had relied on its various statutory powers (s.101 Law of Property Act 1925) since those statutory powers did not interfere with any right, but merely created a ‘default’ position which the parties were free to alter as they saw fit.

In case he was wrong about this, Briggs J went on to consider whether the ability of GMAC to sell the property without a court order was in the public interest. He found that it was - the power to sell without a court order was an integral part of the economic basis for mortgage lending, without which, the mortgage market would not exist. There was no need for an individual assessment of the proportionality of exercising this power in any given case because the appropriate bargain had already been struck and relied, by analogy, on Lord Scott in Quazi v LB Harrow [2004] 1 AC 983.

The suggestion that the protection of the Administration of Justice Acts should apply, regardless of who was bringing the possession claim, was dismissed in very short order. Those powers could only apply so long as a mortgage remained in force. The sale of the property at auction had raised sufficient monies to discharge the mortgage. If there was no mortgage then there was no scope for the Acts to apply.

A possession order was made.

The good, the bad and the ugly

There is some (but not much) good news in this case. It is very encouraging that no-one seemed the slightest bit surprised to be dealing with a Human Rights Act 1998 argument in the context of a dispute between private parties under a private contract. If this case encourages practitioners to raise more HRA arguments in such cases then it can only be a good thing.

Briggs J was also heavily influenced by the fact that it was common ground that Mr Clark and Ms Beech had been in arrears and had broken the terms of their mortgage agreement. He expressly left open the possibility that he would come to a very different conclusion if the powers of receivership and sale had been used without such default having occurred.

The bad news is more obvious. This is quite a loophole for any lender who wants to get around the protections of the Administration of Justice Acts and in the current market, the temptation to do so will, one suspects, lead many more lenders to use this route. The importance of scrutinising your mortgage terms and conditions is plain.

As to the ugly nature of this case. Sadly, the discussion of the law of proportionality was some 4 years out of date. The idea that proportionality simply cannot arise on the facts of an individual case because it is presumed that all questions of proportionality have been dealt with at a higher level (whether in statute or in the market place) is, to put it mildly, one of hot topics in current human rights thinking.

The European Court of Human Rights has made clear in Connors v UK (2005) 40 EHRR 9 and McCann v UK (19009/04), that each person faced with eviction proceedings should be able to have a court assess the proportionality of the proposed eviction and, whilst the House of Lords haven’t quite gone as far as this yet, in both Kay v LB Lambeth [2006] UKHL 10; [2006] 2 AC 465 and Doherty v Birmingham CC [2008] UKHL 57, they made clear that the approach of Lord Scott in Quazi could not stand.

Starting on Monday

Published
by
J
on 4 October 2008
in Housing law
. 5 Comments

A big week for housing law next week. The House of Lords is hearing Knowsley Housing Trust v White [2007] EWCA Civ 404 (tolerated trespassers and assured tenancies in the context of a preserved Right to Buy) Porter v Shepherds Bush Housing Association [2008] EWCA Civ 196 (do assured tenancies give rise to tolerated trespassers at all) and Honeygan-Green v LB Islington [2008] EWCA Civ 363 (the revival of the Right to Buy with the revivial of a secure tenancy and the relevance of previous steps in the RTB process).

However, despite granting permission to appeal in the case of London & Quadrant Housing Trust v Ansel [2007] EWCA Civ 326, we are reliably informed that the case has settled and now won’t be dealt with.

So - having created the nonsense of tolerated trespassers in LB Brent v Burrows [1996] 1 WLR 1148, lets see if their Lordships can finally sort it out. Just in time for most tolerated trespassers to be abolished and have their tenncies restored by Sch. 11, Housing and Regeneration Act 2008.

Harvey v Bamforth - now with the benefit of a transcript

Published
by
J
on 20 September 2008
in Housing law
. 10 Comments

Harvey v Bamforth 8PA13344, HHJ Bullimore, Sheffield County Court, 8 Aug 2008

When we first commented on this case (here) we provoked quite a response. Thanks to to Mr Jones of Bury Walkers (who acted for Ms Harvey) we have now been provied with a transcript of the judgment. So - here is what it says.

Mr Bamforth was the assured shorthold tenant of a property owned by Ms Harvey. A deposit was paid to Ms Harvey via her letting agents. The deposit was lodged with TDS within 14 days of the start of the tenancy.

Rent arrears began to accumulate and, in January 2008 (the transcript says 2007, but I think that must be a typo) possession proceedings were issued. The proceedings were defended on the basis that the prescribed information (s.213(5) and (6), Housing Act 2004) had not been provided. It was accepted by the landlord that the prescribed information had not been provided within the time specified in s.213(5) and (6), but was said that it had been provided at a later date. However, it seems that the landlord withdrew the possession claim, leaving only a money claim for rent arrears.

Mr Bamforth then issued an application for the return of his deposit and for damages of three times the value of the deposit. His application was heard by a Deputy District Judge who ordered that the deposit to be returned pursuant to s.214(3)(b) HA 2004 and ordered damages of three times the value of the deposit pursuant to s.214(4) HA 2004. Both sums set off against agreed rent arrears. The DDJ granted permission to appeal.

Ms Harvey therefore appealed both the order for the return of the deposit and the damages award.

s.213 Housing Act 2004 provides (insofar as is material):

213 Requirements relating to tenancy deposits

(1) Any tenancy deposit paid to a person in connection with a shorthold tenancy must, as from the time when it is received, be dealt with in accordance with an authorised scheme.

(2) No person may require the payment of a tenancy deposit in connection with a shorthold tenancy which is not to be subject to the requirement in subsection (1).

(3) Where a landlord receives a tenancy deposit in connection with a shorthold tenancy, the initial requirements of an authorised scheme must be complied with by the landlord in relation to the deposit within the period of 14 days beginning with the date on which it is received.

(4) For the purposes of this section “the initial requirements” of an authorised scheme are such requirements imposed by the scheme as fall to be complied with by a landlord on receiving such a tenancy deposit.

(5) A landlord who has received such a tenancy deposit must give the tenant and any relevant person such information relating to—

(a) the authorised scheme applying to the deposit,

(b) compliance by the landlord with the initial requirements of the scheme in relation to the deposit, and

(c) the operation of provisions of this Chapter in relation to the deposit,

as may be prescribed.

(6) The information required by subsection (5) must be given to the tenant and any relevant person—

(a) in the prescribed form or in a form substantially to the same effect, and

(b) within the period of 14 days beginning with the date on which the deposit is received by the landlord.

…

Section 214 Housing Act 2004 provides (again, so far as it material):

214 Proceedings relating to tenancy deposits

(1) Where a tenancy deposit has been paid in connection with a shorthold tenancy, the tenant or any relevant person (as defined by section 213(10)) may make an application to a county court on the grounds—

(a) that the initial requirements of an authorised scheme (see section 213(4)) have not, or section 213(6)(a) has not, been complied with in relation to the deposit; or

(b) that he has been notified by the landlord that a particular authorised scheme applies to the deposit but has been unable to obtain confirmation from the scheme administrator that the deposit is being held in accordance with the scheme.

(2) Subsections (3) and (4) apply if on such an application the court—

(a) is satisfied that those requirements have not, or section 213(6)(a) has not, been complied with in relation to the deposit, or

(b) is not satisfied that the deposit is being held in accordance with an authorised scheme,

as the case may be.

(3) The court must, as it thinks fit, either—

(a) order the person who appears to the court to be holding the deposit to repay it to the applicant, or

(b) order that person to pay the deposit into the designated account held by the scheme administrator under an authorised custodial scheme,

within the period of 14 days beginning with the date of the making of the order.

(4) The court must also order the landlord to pay to the applicant a sum of money equal to three times the amount of the deposit within the period of 14 days beginning with the date of the making of the order.

…

Ms Harvey contended that the power to order the return of a deposit and damaged pursuant to s.214(3) and (4) only arose if the court was satisfied that s.213(6)(a) had not been satisfied and that compliance with s.213(6)(b) was irrelevant for these purposes. So - the power to order the return of the deposit and damages only arises if the landlord has failed to provide the prescribed information in the prescribed form (or one in similar effect). It is irrelevant, for the purposes of s.214(3) and (4) when that information is provided.

HHJ Bullimore accepted this argument. In his judgment:

[t]he failure on the landlord’s part was not that ‘the prescribed information was not given’ but that it was not given within the fourteen days. The district judge… took the view that [s.213(6)(a) and s.213(6)(b)] were so closely connected that they only made sense if they were read together but I think that was an error. I think that the draftsman in dealing with proceedings relating to tenancy deposits in Section 214 was very clear in differentiating between the requirements of giving information and giving the information after a specified period.

There were, to his mind, sound policy arguments for this conclusion:

… they are very serious powers to be exercised against a landlord… one can well see that in the minds of the legislators, it was one thing to deal with a landlord who had not provided the prescribed information at all and to deal with it in that way with a landlord who had provided the prescribed information but had not done it within that short period laid down by the Act.

Accordingly, as the information had been given before the tenant made his application, the application should have failed. The appeal was allowed and the order for the return of the deposit and the damages was overturned.

A final word of caution. This was only a decision of a county court and one that was only argued on one side (Mr Bamforth didn’t appear at the appeal). It is not a binding decision and other judges are perfectly free to come to other conclusions. As to whether or not it is right - I’ll leave that to you all to comment on!

A shameless plug: HLPA Conference 10 Dec 2008

Published
by
J
on 20 September 2008
in Housing law and Legal Aid
. 0 Comments

The Housing Law Practitioners’ Association annual conference is being held on the 10th December 2008 at the Royal Institute of British Architects, London. Those of you who subscribe to Legal Action should already have had your application forms, but, for everyone else, details can be found here. The speakers include:

  • Rabinder Singh QC on equality and discrimination law after Malcolm;
  • Andrew Arden QC, Jan Luba QC and Caroline Hunter on current issues in homelessness;
  • Robert Latham and Christopher Baker on allocation schemes;
  • James Stark, Derek McConnell and Bob Lawrence (CLG) on possession proceedings;
  • Matthew Hutchings and Stephen Cottle on housing and human rights.

The conference lasts from 9am till 6pm, is fully catered and attracts 6 CPD points. A day of housing law. With food. And CPD points. What more could you ask for?

Harvey v Bamforth - request for further information

Published
by
J
on 26 August 2008
in Housing law
. 17 Comments

Harvey v Bamforth, Sheffield County Court, Estates Gazette, 23 Aug, 2008, pg 22.

The introduction of the Tenancy Deposit Scheme (”TDS”) was one of the more positive reforms to housing law in recent years. It has previously been discussed by NL here and here, by Housed here and here and by Landlord Law here, all of which are worth a read and, helpfully, save me from having to say much about the scheme.

In the Harvey case, it appears that the landlord had taken a deposit and had placed it in one of the prescribed schemes, but had failed to provide the prescribed paperwork to the tenant, detailing where the deposit was held, etc. The District Judge found this to be a breach of TDS provisions and awarded the mandatory damages of 3 times the value of the deposit. The landlord had, however, provided the relevant paperwork once the tenant issued proceedings.

The landlord appealed to the Circuit Judge (HHJ Bullimore), who reversed the decision of the District Judge. As best as I can tell, the Circuit Judge took the view that provision of the prescribed information at any stage prior to the hearing was sufficient to comply with the requirements of the TDS and, hence, that no damages were payable.

The landlord was funded by the Residential Landlords Association, whose press release can be found here. I’ve written to the RLA to see if there is a transcript but we here at the NL team would be very interested to hear from anyone who was involved with this case.

Having regard…

Published
by
J
on 24 August 2008
in Housing law
. 0 Comments

M & M Savant Limited v Brown and others LRX/26/2006

It is a shame that this case was decided in 2008, and not in 1998 when it would have had a much greater relevance. It contains a comprehensive analysis of s.20 Landlord and Tenant Act 1985 prior to the wide ranging amendments made by the Commonhold and Leasehold Reform Act 2002. Sadly, it is probably now only of interest to those (few) of us with a particular interest in leasehold property disputes.

Mr Brown and the other respondents were the leaseholders of various flats in a block of flats in London, NW7. In 2005, they had applied to the Leasehold Valuation Tribunal in response to a service charge dispute with their landlord. In particular they contended that the Appellant had not complied with the consultation requirements set out in s.20 Landlord and Tenant Act 1985.

Prior to the Commonhold and Leasehold Reform Act 2002, s.20 Landlord and Tenant Act 1985 provided that:

“(1) Where relevant costs incurred on the carrying out of any qualifying works exceed the limit specified in subsection (3), the excess shall not be taken into account in determining the amount of a service charge unless the relevant requirements have been either –

(a)complied with, or

(b)dispensed with by the court in accordance with subsection (9); and the amount payable shall be limited accordingly.

(2)In subsection (1) ‘qualifying works’, in relation to a service charge, means works (whether on a building or on any other premises) to the costs of which the tenant by whom the service charge is payable may be required under the terms of his lease to contribute by the payment of such a charge.

(3)The limit is whichever is the greater of –

(a) £25, or such other amount as may be prescribed by order of the Secretary of State, multiplied by the number of dwellings let to the tenants concerned; or

(c)£1000, or such other amount as may be so prescribed.

(4)The relevant requirements in relation to such of the tenants concerned as are not represented by a recognised tenants’ association are -

(a) At least two estimates for the works shall be obtained, one of them from a person wholly unconnected with the landlord.

(b) A notice accompanied by a copy of the estimates shall be given to each of those tenants or shall be displayed in one or more places where it is likely to come to the notice of all those tenants.

(c) The notice shall describe the works to be carried out and invite observations on them and on the estimates and shall state the name and the address in the United Kingdom of the person to whom the observations may be sent and the date by which they are to be received.

(d) The date stated in the notice shall not be earlier than one month after the date on which the notice is given or displayed as required by paragraph (b).

(e) The landlord shall have regard to any observations received in pursuance of the notice; and unless the works are urgently required they shall not be begun earlier than the date specified in the notice.

(5) The relevant requirements in relation to such of the tenants concerned as are represented by a recognised tenants’ association are -

(a) The landlord shall give to the secretary of the association a notice containing a detailed specification of the works in question and specifying a reasonable period within which the association may propose to the landlord the names of one or more persons from whom estimates for the works should in its view be obtained by the landlord.

(b) At least two estimates for the works shall be obtained, one of them from a person wholly unconnected with the landlord.

(c) A copy of each of the estimates shall be given to the secretary of the association.

(d) A notice shall be given to each of the tenants concerned represented by the association, which shall

(i) describe briefly the works to be carried out,

(ii) summarise the estimates;

(iii) inform the tenant that he has a right to inspect and take copies of a detailed specification of the works to be carried out and of the estimates;

(iv) invite observations on those works and on the estimates, and

(v) specify the name and the address in the United Kingdom of the person to whom the observations may be sent and the date by which they are to be received.

(e) The date stated in the notice shall not be earlier than one month after the date on which the notice is given as required by paragraph (d).

(f) If any tenant to whom the notice is given so requests, the landlord shall afford him reasonable facilities for inspecting a detailed specification of the works to be carried out and the estimates, free of charge, and for taking copies of them on payment of such reasonable charge as the landlord may determine.

(g) The landlord shall have regard to any observations received in pursuance of the notice and, unless the works are urgently required, they shall not be begun earlier than the date specified in the notice.

(6) Paragraphs (d)(ii) and (iii) and (f) of subsection (5) shall not apply to any estimate of which a copy is enclosed with the notice given in pursuance of paragraph (d).

(7) The requirements imposed on the landlord by subsection (5)(f) to make any facilities available to a person free of charge shall not be construed as precluding the landlord from treating as part of his costs of management any costs incurred by him in connection with making those facilities so available.

(8) In this section ‘the tenants concerned’ means all the landlord’s tenants who may be required under the terms of their leases to contribute to the cost of the works in question by the payment of service charges.

(9) In proceedings relating to a service charge the court may, if satisfied that the landlord acted reasonably, dispense with all or any of the relevant requirements.

(10) An order under this section -

(a) may make different provision with respect to different cases or descriptions of cases, including different provision for different areas, and

(b) shall be made pursuant to statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.”

The Court of Appeal, in Martin v Maryland Estates Ltd [1999] L&TR 541 had held that s.20(9) was not a general dispensing power, but contemplated a two stage process. Before considering whether or not to dispense with any or all of the consultation requirements, the court had to be satisfied that the landlord had acted reasonably in all the circumstances in which s.20 had not been complied with.

In 2003, the landlord had obtained estimates from contractors in respect of major structural works. The estimates were not disclosed to the leaseholders, who were merely given a summary of the proposed prices. The estimates were, however, available for inspection at the offices of the managing agents, some 8-10 miles away from the property.

In May 2003, solicitors for Mr Brown wrote to the managing agents and pointed out that s.20 required them to provide a copy of the actual estimates or display them in one or more places where they were likely to come to the notice of the leaseholders. The description of the works was also said to be inadequate. The managing agents responded by enclosing copies of some of the estimates, but did not deal with the substantive objection that the requirements of s.20 had not been complied with, indeed, it appears that they did not give any consideration to the objections and had confirmed a contractor to start the necessary works before the statutory consultation period concluded, thus making it rather difficult to see how they could have “had regard” to the observations received from leaseholders.

The LVT concluded that the consultation requirements had not been complied with. However, under s.20 as it then read, the LVT had no jurisdiction to consider whether or not the landlord should be granted dispensation from the requirements of s.20 (although it does now have that jurisdiction). At the time, that jurisdiction was vested in the county court. Unfortunately, the mere fact that it lacked jurisdiction to consider these matters did not prevent the LVT from making a series of findings of fact about the circumstances in which s.20 was not complied with and making clear that, in the view of the LVT, dispensation should not be granted.

The appellant applied to the county court for dispensation and appealed to the Lands Tribunal against the decision that s.20 had not been complied with. The President of the Lands Tribunal granted permission for the appeal to be heard and directed that it be heard with the application for dispensation, before a Member of the Lands Tribunal who was also a Judge of the county court.

The Lands Tribunal rejected the appeal. It was very difficult to see how s.20(4)(b) could be satisfied by merely telling the tenant where the information could be inspected but, even if that was sufficient, on the facts of this case, the information was not displayed in a place where it was likely to come to the attention of all the tenants, but was only available in an office, some 8 to 10 miles away. This defect was not cured by the managing agents later sending some of the documentation to one of the leaseholders. The effect of this defect was that there had been no proper compliance with s.20(4)(b), with the result that the statutory consultation period had not started to run.

It was not appropriate to grant dispensation from the consultation requirements. This should have been a relatively simple consultation exercise and there was no reason to give any degree of latitude to the landlord. The managing agents had acted unreasonably in, effectively, ignoring the letter sent by Mr Brown’s solicitors - “[w]here a landlord receives a letter from solicitors for a tenant being a letter which correctly asserts that the landlord is failing to comply with the consultation requirements and gives reasons as to why the landlord is failing and what the consequences of such failure may be, then if a landlord merely carries on regardless and commences the works without first properly carrying out the consultation requirements I consider such a landlord acts unreasonably…” Accordingly, the landlord had not acted reasonable and, hence, the jurisdiction to dispense with the consultation requirements did not arise.

Even if it had arisen, it would have been wrong to exercise it in favour of the landlord. The leaseholders had lost an important opportunity to comment on the proposed works and contractor and this was not something that the court should overlook.

The reforms contained in the 2002 Act have deprived much of this case of any lasting significance. The Lands Tribunal has already indicated that, under the new consultation provisions, a much more generous approach will be afforded to landlords and dispensation more easily granted (see LB Camden v Various Leaseholders at Grafton Way LRX/185/2006 and Auger v LB Camden LRX/81/2007). What is of use, however, is the discussion about what it means to “have regard” to observations received from leaseholders. This obligation to has been retained in the new s.20 consultation procedures and seems to import an obligation to actively consider and respond to any observations received. It may be that leaseholders can find something useful in this case when seeking to challenge a landlord which appears to have had little regard to their observations.

Surely your best point is…

Published
by
J
on 10 August 2008
in Housing law
. 2 Comments

Swanlane Estates Ltd v Woods and others LRX/159/2007 (.pdf)

This case concerns the not uncommon situation of a court or tribunal (in this case, a Leasehold Valuation Tribunal) taking a point which the applicant / claimant had not expressly pleaded and the respondent / defendant then losing the case on that very point.

Mr Wood and a number of his fellow leaseholders applied to the Leasehold Valuation Tribunal (LVT) for a determination of their service charge liabilities for the years 2004 – 2007. The extent of the challenge was described as “request fully detailed itemised dated of each charge on list (this had not been forthcoming) assess what should be covered by buildings insurances establish which work actually carried out, and by whom. Proof of what has been paid to whom.” A list of disputed items was also attached.

Some of the items related to costs had clearly been incurred at least 18 months before being demanded. This was important because, by virtue of s.20B Landlord and Tenant Act 1985, a landlord must demand service charges within 18 months of incurring them or he is not entitled to recover anything from the leaseholders in respect of the expenditure in question. However, Mr Wood made no express reference to a challenge under s.20B.

The landlord filed a statement in reply, setting out its factual response to each disputed item. It also contended that there had been compliance with s.20 Landlord and Tenant Act 1985, more commonly known as the consultation requirements (i.e. that the leaseholders had been properly consulted in respect of the disputed items). If the consultation requirements are not complied with, the amount of money which the landlord and recover by way of service charges is severely limited, unless the LVT can be persuaded to grant the landlord dispensation from the consultation requirements.

At the hearing, the LVT took two points which Mr Wood had not raised himself. Firstly, they suggested that a number of the disputed items fell foul of s.20B in that they had not been demanded within 18 months of being incurred and, secondly, that the landlord had not properly complied with the consultation requirements contained in s.20. The landlord was given a short adjournment of 30 minutes in order to produce evidence relating to these points. The evidence which was produced did not satisfy the LVT and, as a result, the service charges of Mr Wood and the other leaseholders were reduced by £71,019.18.

The landlord appealed on two grounds. Firstly, it was said that the LVT was wrong in law to take points which had not been pleaded. Secondly, it was said that the LVT had not afforded the landlord a fair hearing in that it had not allowed the landlord sufficient time to respond to the points.

The first ground of appeal failed. The Lands Tribunal concluded, in very robust terms, that the LVT was entitled to raise the points that it did. It is quite right that the LVT clarify the issues between the parties, particularly where one side is not legally represented. It was quite possible that the leaseholders were not aware of the rights which Parliament had conferred upon them. The LVT was not required to sit in silence and find the applicants liable for service charges when the LVT had good reason to query as to whether the charges were legally due. Whilst there was no obligation on a landlord to disclose documents on matters which had not been pleaded, a prudent landlord which was certain that it had complied with the law would have disclosed all relevant documents relating to both the s.20 consultation point and the s.20B point.

The second ground of appeal, however, succeeded. The LVT had erred in law by only allowing 30 minutes for the landlord to produce the relevant documents. It should have granted an adjournment to the next day in order to allow the landlord to address the point and find the relevant evidence.

The case was remitted to a differently constituted LVT with directions for the disclosure of the relevant notices and for the leaseholders to file written submissions as to whether or not they had received the notices.

It is not uncommon for a leaseholder to challenge their service charges in the most general terms, often with only a basic understanding of the relevant law and it is very encouraging to see the Lands Tribunal encouraging the LVT to take a robust approach to such cases and to make sure that all relevant matters are dealt with, regardless of whether the leaseholders have expressly raised the point. Landlords will consider that this represents further evidence of the alleged pro-leaseholder bias of the LVT but, as the Lands Tribunal pointed out, a well organised and prudent landlord should have access to the relevant paperwork and should be able to disclose it without too much difficulty. Now, just to find a well organised and prudent landlord… it can’t be that hard, can it?