Knowsley v White etc. in more detail

Knowsley HT v White, Honeyghan-Green v LB Islington & Porter v Shepherds Bush Housing Association [2008] UKHL 70 –  for anyone who hasn’t read it yet.

There is lots to unpick here, so I’ll go case by case. It is made easier by there being pretty much one judgment, that of Lord Neuberger. The other substantial judgment, that of Lord Manse, will only be dealt with at the points of dissent.

Knowsley HT v White

Lord Neuberger advances three reasons for an assured tenancy ending only with the execution of the order.

First, ‘it would not otherwise be entirely easy to characterise the status of a tenant in occupation under the shadow of an order for possession’. ‘Tolerated trespasser’ is oxymoronic as a concept and the potential retrospective revival of tenancy presents further conceptual problems. [paras 79-81]

Second, the sheer uncertainty of the tolerated trespasser’s rights and obligations as against the landlord, as found in the case law, and the arguments over the precise terms of a possession order (see Bristol City v Hassan) where orders which appear to have identical effect turn out not to (Thompson v Elmbridge [1987] 1 WLR 1425 as against Harlow v Hall [2006] 1 WLR 2116, for instance). [para 82-83]

In addition, there is the effect on the rights of third parties, e.g. of a a visitor against the landlord under the Defective Premises Act 1972 – which depends on the landlord being under an obligation to the tenant for repair. Here Lord Neuberger throws in the intriguing suggestions that:

It is fair to say that I would incline to the view that it would have such a duty. The suspended order will be on terms that the landlord is entitled to payment for the tenant’s current occupation at a rate which assumes it is liable for repair (either under the terms of the tenancy or pursuant to section 11 of the Landlord and Tenant Act 1985). [para 83]

This looks like a strong suggestion that payment of mesne profits at the same rate as the rent incurs a contractual obligation to repair in the same express and implied terms as the tenancy agreement. And no other judgment dissents from this. (Ooooh. I so want to try this out).

The third reason is that s.9 of the 1988 Act means that the Court retains wide powers to vary or discharge the order. This points to the fact that the tenancy does not end until those powers are at an end. S.9 of the 1988 Act mirrors very closely the wording of s.100 of the 1977 Act, rather than an assumed parity with s.85 of the 1985 Act. There is no equivalent in HA 1988 to s.82(2) of the HA 1985 [paras 85-88]

Logic means that the conclusion also applies to assured tenancies subject to outright possession orders, Artesian Residential Developments v Beck [2000] QB 541 overruled.

Of course, the first two reasons apply equally to the tolerated trespasser regime under Housing Act 1985. Given that Thompson and Hall relied on s.82(2) HA 1985, there is a logical distinction between the two acts. That said, had the point not been determined in Burrows, Lord Neuberger would have reached the same conclusion on the 1985 Act and take ‘the date on which the tenant is to give up possession in pursuance of the order’ in s.82(2) as being the date of execution. The question, it appears was open to consideration, but counsel for all parties apparently suggested that, in view of the Housing & Regeneration Act 2008, and the sheer number of cases involved, it was too late. [paras 90-92]

Proleptic discharge of possession orders (Honeygan-Green & also Porter)

Marshall [2002] HLR 428 held that a suspended possession order could not include a proleptic order such that the possession order was discharged when the arrears and costs were paid, on the basis that the power under s.85(4) HA 1985 could only be exercised in the light of the circumstances prevailing at the time. [para 94]

Lord Neuberger overturns this, based on Payne v Cooper [1958] 1 QB 174, which was not before the Court in Marshall. The analysis proposed by James Stark in Helena Housing v Molyneux is expressly adopted.  [para 98]. In any case CPR 3.1(2)(a) may well mean that  it would be open to the Court to make such an order in any event. [para 100]

The terms of the proleptic discharge and the suspension do not have to be the same (Lord Mance dissenting). To insist that a discharge can only be achieved via a s.85(4) complete compliance with the order is too take an overly technical view. If a proleptic order is possible and the Court can vary the terms of the order retrospectively, then it would be surprising if the court could not proleptically order discharge on different terms to the suspension [para 102]. Again, Payne v Cooper is cited in support.

While an application via s.85(2) is open to those who have breached the terms of the order, this involves expenditure and effort as well as uncertainty for the tenant, who is unlikely to even know how to approach this. [para 106]. The Court is to consider would be a fair proleptic condition of discharge [para 108] but Lord Mance’s suggestion of ‘substantial compliance’ (see para 13 on)  is too uncertain – conditions for an SPO should be taken strictly (and the landlord can apply for a warrant on breach – but if the landlord’s application is unreasonable, costs consequences could follow).

Lord Mance’s dissent is based on a reading of Payne v Cooper (which involved an outright possession order converted to an SPO) pointing out that Payne did not involve a situation where the tenant had failed to meet the conditions of the order. Lord Mance saw nothing in Payne that gainsaid the Burrows analysis of s.85(4) and so argued that there was no power to make a proleptic discharge order on other terms than complete compliance with the conditions of the order [paras 21-24].

What isn’t at all clear is what form of words will count as a proleptic discharge. Those in Honeygan-Green’s order would – ‘upon payment of the arrears in full claim do stand dismissed’. Those in Porter’s order wouldn’t – ‘when you have paid the total amounts mentioned, the plaintiff will not be able to take any steps to evict you as a result of this order’. It is impliedly suggested that ‘this order will cease to be enforceable’ would not be sufficient for a proleptic discharge, and this is the form of most N28 and indeed N28A possession orders. So application under s.85(2) or (4) would still be required, unless the tenant waits for a replacement tenancy under H&RA 2008.

Porter v Shepherds Bush HA

The Swindon v Aston trap – paying off all arrears and costs on a breached SPO, or one that provides it is ‘unenforceable’ on such paying off, making it unvariable – falls for the reasons already given. Marshall is wrong on the limits of s.85(4) and Swindon v Aston is wrong on s.85(2).

There is nothing in s.85(2) which expressedly or impliedly prevents a tenant from making an application under s.85(2) after paying off the arrears and costs. If anything, the wide powers of s.85 indicate that the tenant should have such a right.

Honeygan-Green v Islington

While a person must be a secure (or assured) tenant throughout the period from service of the s.122 HA 1985 Notice through to completion, as approved in Bristol City Council v Lovell [1998] 1 WLR 446, the re-instatement of a tenancy on discharge of a possession order entitles the tenant to renew the right to reply on the notice. To argue that the right to buy pursuant to a s.122 notice is lost when the tenancy is determined by a possession order and that it cannot be retrospectively re-instated by the retrospective revival of the tenancy produces unacceptable results under s.122(2) and flys in the face of s.122(1) (‘obliged to give up possession’). It also offends against the  Lambeth LBC v Rogers (1999) 32 HLR 361 principle of retrospective  revival. [paras 114 -117]

So, an SPO suspends but does not end the right to buy, which is only extinguished on execution. Otherwise, even a tenant on the brink of completion who was subject to a vexatious bankruptcy petition would lose the right.

As Rogers means that the tenancy is revived retrospectively as if it had always been, and in view of the conclusion on assured tenancies, there is no reason to apply a considerably more penal regime on secure over assured tenants in this regard. [paras 121-122]

This may give the tenant a certain advantage – in both a rising and falling market, but there is no power to impose conditions on regaining the RTB under the possession order, s.85(3)(b) does not extend that far. [para 126]

However, the landlord can still serve notices under s.140 and s.141 during the period of trespasserhood, and if the tenant does not (as he cannot) complete in the time specified in the s.141 notice, the s.122 notice is treated as withdrawn.

And there we are. There is much else in there, of course, and the suggestion that their Lordships were prepared to sweep away the whole tolerated trespasser regime – assured and secure – is fascinating.  I am already wielding this judgment, both in headline and in nuance, and I’m sure the same is true of all of us. I can’t wait to see what the Court of Appeal make of this changed landscape in the remaining tolerated trespasser cases. I understand, for instance, that written submissions on this judgment were requested by the Court of Appeal in LB Southwark v Austin, in which we await the handing down of the CoA judgment.

Now if only we’d had this Lords decision about 10, or 20 years ago…

Credit to:

On White, solicitor Tony Fearnley of Keoghs and Nicholls, Lindsell and Harris, Counsel Adam Fullwood and Jan Luba QC

On Porter, solicitors Sharpe Pritchard/Olivr Fisher, Counsel Miles Croally and Richard Drabble QC

On Honeygan-Green, solicitors Wilson Barca, Counsel Adrian Jack and Richard Drabble QC again

About Giles Peaker

Giles Peaker is a solicitor and partner in the Housing and Public Law team at Anthony Gold Solicitors in South London. You can find him on Linkedin and on Twitter. Known as NL round these parts, and still is Nearly Legal on Google +.
Posted in assured-tenancy, Housing law - All, right-to-buy, secure-tenancy, Tolerated trespasser and tagged , , , , .

2 Comments

  1. Lord Neuberger was (when he was merely David Neuberger QC) counsel for Mrs Burrows in LB Brent v Burrows. I suspect he saw this judgment as an attempt to expunge one of the biggest disasters of his professional life. It certainly reads as a much more melancholy judgment than his Lordship usually writes.

    The next question is “where do we go from here?” The assured tenancy amendments contained in the H&RA 2008 do not – presumably – need to come into force, although the amendments to secure tenancies do.

    What are the pros and cons of secure tenants (and / or landlords) allowing their position to normalise via the H&RA 2008 rather than making an application to resurrect their tenancy? I’ve heard Jan Luba QC express the view that the latter is preferable but I’ve not yet heard his reasoning.

  2. Revival offers continuity of tenancy which a replacement doesn’t. So disrepair, RTB, transfer qualification may be issues, but I haven’t seen Jan Luba’s reasons either. When I have time I’m going to sit down with the Act and think.

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