Nominations agreements and the Equality Act

I was excited to see R(Z) v Hackney LBC & Agudas Israel HA (2019) EWHC 139 (Admin), because it is the first case in which the thorny issue of “nomination” rights and, potentially, the concept of a “true void” have arisen for full decision by a court of record (of which I know anyway), and before the Divisional court (Lindblom LJ & Sir Kenneth Parker) too.  However, the decision turns very much on the Equality Act issues raised, and the facts, including that Agudas Israel HA is a very small player in Hackney with an average of 12-13 lettings pa, and the evidence concerning the particular community it serves (the Orthodox Jewish Community in housing need).  This was not a case where the HA refused to accept a nomination, but where a household in the highest possible housing need, with a need for a four bedroom property in Hackney, and subject to a direct offer of such a property.  Agudas Israel HA let at least six four bed properties during that period, but not to Z and her family, despite Agudas Israel being a partner in the Hackney’s allocation scheme and Hackney having nomination rights over 75% of the family sized true voids.

The case is also notable for what, in retrospect, can be seen as the meticulous preparation of evidence by Agudas Israel, which demonstrated the particular housing needs of the Orthodox Jewish community in Hackney, especially to larger accommodation (“the average number of occupants of Orthodox Jewish households in Stamford Hill was 6.3, in contrast to the average for the whole of Hackney of 2.43, and for the UK of 2.38”); levels of anti-semitic incidents nationally and locally; particular religious needs around community; particular needs within the home, which were stretched (less persuasively, as far as the Divisional Court was concerned) to food preparation in the home.  This evidence provided responses to the issues raised as a result of the direct discrimination against non-members of the Orthodox Jewish community under the Equality Act.

The principal issue dealt with by the Divisional court related to s. 158, EA, which deals with conditions that justify taking positive action in relation to “persons who share a protected characteristic suffer a disadvantage connected to the characteristic”; principally where it is a proportionate means of achieving the aim of “(a) enabling or encouraging persons who share the protected characteristic to overcome or minimise that disadvantage, (b) meeting those needs, or (c) enabling or encouraging persons who share the protected characteristic to participate in that activity”.  Counsel for Z argued that the Orthodox Jewish community did not suffer any disadvantage “connected to the characteristic”, and that that allocations arrangements were not proportionate.

However, given the evidence:

… it appears to us to be self-evident why in practice AIHA allocates each of the properties, which at the margin becomes available, to members of the Orthodox Jewish community. Given the limited availability to, and pressing demand from, that community, if AIHA were to allocate any of its properties to non-members, it would seriously dilute the number of properties available to Orthodox Jews, and would fundamentally undermine its charitable objective of giving “primary” position, in a meaningful, as distinct from formalistic, sense to Orthodox Jews. (74)

Further, given the disadvantages and needs of the Orthodox Jewish community, which are “many and compelling”, the arrangements were justified as proportionate.

Given that decision, the next part of the judgment which concerns s. 193 (the exemption for charities) is obiter, albeit persuasive given that the Divisional Court heard full argument on the point. The submission was that this exemption did not apply to Agudas Israel HA because the exemption “does not apply to race, so far as relating to colour”.  Given that members of the Orthodox Jewish community are predominantly white, the argument was that the allocation arrangements “have the effect of discriminating indirectly against persons who are not of the white race” so that the charity exemption did not apply.  this objection was, however, brushed aside by the Divisional Court, holding that it applied to those with the specific protected characteristic in the charitable instrument (Agudas Israel HA’s was to member of the Orthodox Jewish community).

The challenge to Agudas Israel fell away, leaving the challenge to Hackney, but these grounds essentially fell away once Agudas Israel HA’s scheme had been justified:

Provided that AIHA is acting lawfully in the relevant respect, Hackney simply has no legal right or power, even if it were so minded, to insist that AIHA jettison its lawful arrangements, and to make allocation decisions without regard to those arrangements. AIHA has a “duty to co-operate”, but it has not been suggested, nor could it be sensibly suggested, that AIHA would act “unreasonably” in so far as it insisted, as it currently insists, on applying arrangements that are perfectly lawful under the 2010 Act. AIHA is co-operating with Hackney in a manner that is consistent with its own lawful arrangements.

Assuming this matter goes forward, which one might think that it will unless it becomes academic, there are interesting arguments which may open up about amenability of HAs to JR (see (131)) and whether Agudas Israel was providing a system of allocation of social housing, without any relevant entitlements, or a service of providing housing accommodation – here the Divisional Court, at (50), offered a different opinion to that of Garnham J in R(XC) v Southwark LBC (2017) EWHC 736 (Admin), at (58), which is a point to note going forward, albeit obiter.

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