Austin v London Borough of Southwark [2010] UKSC 28

It has been a long story for Mr Austin and a long, long, long story for the tolerated trespasser. But this Supreme Court judgment should be the last time the Supreme Court is troubled by the legacy of Thompson v Elmbridge Borough Council [1987] 1 WLR 1425 and Burrows v Brent London Borough Council [1996] 1 WLR 1448. Further, it is, in many ways, an epitaph for the ‘anomalous’, ‘dubious’, ‘oxymoronic’ concept of the tolerated trespasser – and ‘all of this nonsense’ could have been avoided (quotes from Baroness Hale, on which more below). This is a judgment worth reading in full, but I’ll do what I can.

Our report of the Court of Appeal judgment is here, but briefly the facts are that Barry Austin was the brother of the late Alan Austin, who was a Southwark secure tenant. In 1987 a suspended possession order was made against Alan Austin in the then form N28, ‘not to be enforced’ if arrears of £3192.96 were paid within 28 days. The order was breached, so on any evaluation, Alan Austin was a tolerated trespasser from 1987. Southwark did not enforce the Order and there was no indication that Alan had been informed that he was a tolerated trespasser then or subsequently. In 2003, on his account, Barry Austin moved in with his brother to care for him as he was by then seriously ill. In February 2005, Alan Austin died. In September 2006 Southwark served Notice to Quit on Barry Austin and then began possession proceedings in January 2007. It came as a complete surprise to Barry that there had been a possession order and certainly that his late brother was a tolerated trespasser.

Barry Austin applied to the County Court to be appointed to represent Alan’s estate in the 1986 possession proceedings under CPR 19.8 and, if appointed, to apply for an order under s.85(2)(b) Housing Act 1985 postponing the date of possession such that Alan’s tenancy would have existed at the date of his death and Barry would have, on his account, succeeded to the tenancy. The application failed at first instance, on appeal to the High Court and, as our previous report sets out, on appeal to the Court of Appeal. There were a number of issues on each appeal, but the principal issue was the Court of Appeal judgment in Brent London Borough Council v Knightley (1997) 29 HLR 857, that the right to apply for a postponement of an order for possession was not an interest in land capable of being inherited, and was therefore a personal right that ended with the death of the tenant/tolerated trespasser. Although Barry Austin had not alleged direct inheritance, but instead sought appointment for the estate of Alan Austin, Knightley was held to be fatal for that application and any arguments raised on ‘property’ under Article 1 Protocol 1 ECHR in its support.

So, to the Supreme Court.
Barry Austin raised as grounds of appeal:
i) a secure tenancy does not end on breach of a conditional suspended possession order but endures until the order for possession is executed. (The Knowsley argument, paralleling the finding on assured tenants on Knowsley Housing Trust v White, link to our report)
ii) Brent v Knightley was wrongly decided, such that the right to apply under s.85 Housing Act 1985 survived the (ex) tenant’s death
iii) Such a right to apply is a possession under article 1, Protocol 1 of the European Convention on Human Rights
iv) To hold that the right to apply did not survive death would be in breach of Art 1 Protocol 1
v) the deceased person had an interest in a claim for the purposes of CPR 19.8

Southwark maintained that Burrows v Brent and Brent v Knightley were rightly decided and that, for the reasons given in the Court of Appeal no right to apply arose and so no interest in a claim under CPR 19.8

Lord Hope’s lead judgment, with which Lords Brown and Kerr agree, is that LB Brent v Knightley was wrongly decided. The details of the reasoning are set out below. But what is remarkable is the assessment Lord Hope (and indeed Baroness Hale) make of the judgments in Thompson and Burrows.

On issue i) Lord Hope finds that the argument wholly revolves around the interpretation of s.82(2) Housing Act 1985, which as originally enacted read:

Where the landlord obtains an order for the possession of the dwelling-house, the tenancy ends on the date on which the tenant is to give up possession in pursuance of the order.

Thompson and Burrows had found that this meant on the date specified for possession in the possession order, or as per Thompson, where there was a breach of the terms of the order suspending enforcement. As we all know, Harlow DC v Hall later meant that on the then wording of Form N28, the tenancy ended on the date of possession in the order regardless of breach of terms. However, in Knowsley v White, Lord Neuberger had taken the view, albeit obiter, that it was entirely possible for an alternative interpretation of s.82(2) to be made, such that the date the tenancy ended was the date ‘on which the tenant was to give up possession’, i.e. on enforcement, bringing it into line with the interpretation of Housing Act 1988 for assured tenants in that case. The House of Lords did not pursue this interpretation in Knowsley, largely because Counsel for all parties (including Jan Luba QC) submitted that the then Housing and Regeneration Act would remedy this issue via the replacement tenancy, and in view of the may thousands of cases that had already been based on Thompson et al.

Lord Hope is more than prepared to entertain Lord Neuberger’s view of s.82(2), noting that it is

a remarkable fact that a conclusion about the meaning of section 82(2) which, admittedly with the benefit of hindsight, is so obviously unsatisfactory and conceptually confusing should have been reached with so little reasoning. [para 20]

(that’s a lack of reasoning in Thompson and then in Burrows). In Thompson it was little more than a one sentence assertion and in Burrows there was no attempt at reasoning beyond noting the result in Thompson.

The context of s.82(2) in the Act tends to favour Lord Neuberger’s interpretation, in view, for instance of the continued right to buy under s.121 which only a secure tenant can have, s.118. However, the question then is should the Supreme Court hold Thompson and Burrows as wrongly decided?

At issue is the Practice Statement of 26 July 1966 on the then House of Lords overturning its own judgments. The Practice Statement remains relevant for the Supreme Court. In this case, Lord Reid’s observations in R v Knuller (Publishing, Printing and Promotions) Ltd [1973] AC 435 were pertinent:

I have said more than once in recent cases that our change of practice in no longer regarding previous decisions of this House as absolutely binding does not mean that whenever we think that a previous decision was wrong we should reverse it. In the general interest of certainty in the law we must be sure that there is some very good reason before we so act. … I think that however wrong or anomalous the decision may be it must stand and apply to cases reasonably analogous unless or until it is altered by Parliament.

Not only was the decision in Thompson of long standing, and as such had been relied upon in many thousands of county court cases, but the Housing and Regeneration Act 2008 had substantially addressed the problems of the tolerated trespasser regime. Apart from the factual situation in this case, the only remaining effect of the tolerated trespasser period was the absence of liability on the landlord’s part for covenants – specifically the repairing covenant – during the period of tolerated trespasser status prior to the replacement tenancy. Parliament’s deliberate decision not to revive or retrospectively reinstate tenancies had to be respected. Lord Hope considered the evidence of the consultation process in this regard. To declare Thompson wrongly decided would be to undo the will of Parliament in the HRA 2008.

On issue ii) there is nothing is s.85 Housing Act 1985 that prevents the right to apply from being ‘transmitted’. The right is conferred by statute and so statute governs its limitations, rather than common law.

In Knightley, Aldous LJ in the High Court had found the right was ‘incapable of being inherited’, This was not the same as ‘incapable of being transmitted’ as Longmore LJ had mistakenly found in the Court of Appeal. The distinction is that between common law and statute. Further:

Addressing himself, in para 54, to the terms of the statute, Longmore LJ said that Parliament plainly intended that the person who would otherwise be entitled to a secure tenancy if it had been revived should not be able to revive it in his or her own name. To hold that the deceased’s estate can apply to revive it for the purpose of enabling that person to obtain a secure tenancy would be to circumvent, if not flout, that intention by means of a legal device. I have to confess that I do not follow this reasoning. It seems to confuse the provisions about succession on the death of the tenant under a secure tenancy with the situation that section 85 is dealing with, which is the exercise of powers by the court on the making of a possession order. [para 37]

The powers in s.85 are exercisable ‘at any time before the execution of the order’. There is no limitation on death, whereas s.87 to 90 deal expressly with the death of the tenant but do not contain any provision limiting the application under s.85. A number of situations in which the s.85 right could be exercised were imaginable, for example:

where the tenant has died before the possession order has taken effect to end the tenancy. There would seem to be no reason why the deceased’s personal representative should not be able to seek the exercise of the power to postpone giving effect to the possession order, for example to enable the deceased’s affairs to be put in order and any licensee or sub-tenant to be re-housed. Another example of a case where one would expect the personal representative to be able to apply would be where the deceased tenant, having made good a previous default, has applied for the date for possession to be postponed but dies the day before his application is to be heard. [para 38]

If the s.85 powers were exercisable after the tenant’s death in the circumstances envisaged in s.90(3) or by a spouse in occupation at tenant’s death when possession proceedings are brought by s.85(5), then it was clearly envisaged that the s.85 powers did not end with the tenant’s (or tolerated trespassers’) death.

For these reasons Knightley was wrongly decided.

Issues iii) and iv) therefore did not require deciding.

On issue v) the proceedings in which application to be appointed on behalf of the estate would be made were the original possession proceedings, given that the right to apply under s.85 remained. (On a personal note, I claims small vindication on this point as I took this view from the start of the case). On this Lord Hope says:

I have to say that I regard this solution to his case to be preferable to the solution for which Mr Luba contended under the first issue. It is directed precisely to the situation that arises where a former tenant who has become a tolerated trespasser has died. Above all, it preserves the discretion of the court under section 85(2) to do what is just in all the circumstances. This is a protection for the landlord which would be entirely absent if the first solution were to be adopted. [para 40]

And then there is the only other substantive judgment by Baroness Hale, with whom Lord Walker agrees. Baroness Hale’s findings are the same as Lord Hope’s. The circumstances are not right to overturn Thompson and Burrows, but Brent v Knightley is wrongly decided. And the reasons given are similar. But what is notable about Baroness Hale’s judgment is the strength of her view that:

had it not been for Parliament’s intervention, it would have been the duty of this Court to set the matter right. There is no reason to believe that Parliament intended that such an anomalous status should arise as a result of the provisions of the 1980 and 1985 Housing Acts. There is little reason to believe that the full implications of their decision were apparent to the Court of Appeal when they decided Thompson v Elmbridge Borough Council [1987] 1 WLR 1425. That decision was assumed to be correct by the House of Lords in Burrows v Brent London Borough Council [1996] 1 WLR 1448 but it suited both parties for them to do so.[para 44]

The issue did not directly arise in Knowsley and:

Thus there is no House of Lords case which has addressed the issue full on and reached a reasoned conclusion about it. If there had been, it would have had to address all the conceptual and practical problems which have arisen since Thompson. [para 44]

Lest we were in any doubt about those consequences, the tolerated trespasser is described as an oxymoron.

These were not people whom the local authority were reluctant to have there and were waiting for the machinery of eviction to take its course. These were people whom the authority wanted to have there, provided that they could be persuade to pay most, if not all, of their rent. [para 45]

This situation would normally have given rise to a licence at least and most probably – Street v Mountford – a tenancy. But the House had relied upon the availability of a s.85 application, while no one had argued that the same policy result could have been achieved by over ruling Thompson.

It is unlikely that the Court realised the implications of its decision, particularly in view of the later Court of Appeal decisions in Harlow DC v Hall and Bristol City v Hassan. The effect a date for possession being given in old possession orders was surely usually accidental. A different construction of s.82(2) could have avoided all of this.

Were it not for the Housing and Regeneration Act 2008, it would be right for the court to ‘sort this matter out’.

The decisions in Thompson and the cases which proceeded on the unquestioned basis that Thompson was correct were not merely wrongly decided. They set the law on a course which was wrong in principle and wrong in practice. […] Even if some local authority landlords might have welcomed not being under a contractual obligation to repair properties for which the occupier was not paying the full rent, they would also have acknowledged that it could not be right for them to be able to charge the equivalent of the full rent which was calculated on the basis that they did have an obligation to repair. In such circumstances, it would ordinarily be our duty to recognise that the law had always been what we hold it to be. [para 54]

However, the only gaps remaining in the Housing and Regeneration Act 2008’s approach to the issue were the repairing covenant for the period of tolerated trespasserhood – for which the Court’s discretion to find the tenancy as continuous had been provided in the Act – and the circumstances of the present case, which overturning Brent v Knightley solved. So:

I would reluctantly dismiss the appeal on the first issue but happily allow it on the second. [para 56]

Barry Austin’s application under s.85 remitted to the County Court for decision.

Comment
It is perhaps understandable that their Lordships could not bring themselves to overturn the whole tolerated trespasser regime. Given the thousands, if not tens of thousands, of county court judgments based on it, the consequences could be very messy indeed. But the clear implication of the judgments is that the whole 20 year period was an error that should not have been made.

The practical result of this case should not be underestimated. We know of at least 10 cases stayed pending this judgment. Anecdotally, I know of at least another one that settled happily, but which would not have been contentitious at all on this result. Considering the tens of thousands of tolerated trespassers, there are likely to be significant numbers who died while having tolerated trespasser status and whose would-be successors now have a chance to apply to postpone possession and thereby succeed.

The process is that the estate, if there was a will, should apply under s.85 in the original possession proceedings to vary the date of possession. Or where the TT was intestate (more usual), the potential successor should apply under s.85 to vary the date of possession in the original possession proceedings. As Knightley is overturned, I don’t think there should be any need to first apply under CPR 19.8 to be appointed as representative first.

And, if anyone needed reminding, the last lacunae of the TT regime – the landlord’s repairing obligation – can be remedied (as things currently stand) by application under s.85 to vary the original possession order, which remains valid despite the replacement tenancy and/or by application under Schedule 11 of the Housing and Regeneration Act 208 for the replacement tenancy to be considered as continuous from the original tenancy. It is probably worth brandishing the passage of Baroness Hale’s judgment on repairs and charging mesne profits of full rent quoted above when doing so.

Congratulations to Charlotte Collins of Anthony Gold, who case this has been throughout, Desmond Rutledge and Jan Luba QC of Garden Court (for the latter not least for standing in front of the Supreme Court to argue that his own submissions on the then Housing and Regeneration Bill in Knowsley were wrong. That takes both courage and grace.)