House of Surprises

If 2009 was the year of surprises for housing lawyers, 2010 will partly be spent getting over them. Major judgments in the House of Lords brought an end to some areas of challenge, confirmed others and opened up an entirely new problem in homelessness cases. But a question remaining for 2010 is whether the Supreme Court will tackle the difference in opinion between the English courts and the European Court of Human Rights on possession and a proportionality defence.

Allocation schemes and irrationality

The first shock of the year from the Lords came in R (Ahmad) v LB Newham [2009] UKHL 14. The issue was Newham’s allocation scheme, which had been found to be unlawful by the High Court and the Court of Appeal. Newham allocated 75 per cent of properties via a choice-based letting scheme, which had three bands: reasonable preference, existing tenants transfer and everyone else. The other 25 per cent were direct offers for additional preference, multiple needs (both tightly defined as acute cases) under-occupation transfers, decants and special schemes.

The Court of Appeal held the scheme was unlawful as it didn’t allow for cumulative need (a combination of ‘reasonable preference’ factors). Also, the scheme allowed for those with no reasonable preference to take priority over those with one, via the direct offer part of the scheme. This followed some fairly well-settled precedents.

The House of Lords overturned this judgment. It held that, in general, if a scheme complies with the requirements of section 167 of the Housing Act 1996, courts should not get involved in issues of how relative priority was determined. There may be exceptions, but these would involve “rare and extreme circumstances”. Newham’s scheme, although “rough and ready”, was not irrational in using waiting time as a prime determinant of priority within bands. In addition, reasonable preference does not mean absolute priority over everyone else. It is an issue of overall policy in disposal of housing stock, not an individual priority. Newham was entitled to strike the balance it did.

This effectively brings to an end the challenges to local authority allocation schemes as failing to comply with the requirements of part 6 of the Housing Act 1996, unless there is clear irrationality. In particular, the judgment removes cumulative need as a challengeable issue. Allocation schemes need do little or no more than address ‘reasonable preference’.

Another turning point was the case of Birmingham v Ali on suitable accommodation for homeless people.

When unsuitable accommodation remains suitable

In Birmingham v Ali (aka Birmingham City Council v Abdishakur Aweys & Ors [2008] EWCA Civ 48), the Court of Appeal had held that once a local authority had accepted that an applicant was homeless because it was no longer reasonable for them to remain in their current accommodation, the property could not be suitable for them to remain living in pending the offer of suitable accommodation.

Meanwhile, in Manchester City Council v Moran [2008] EWCA Civ 378, the Court of Appeal had held that a women’s refuge could be accommodation in which it was reasonable for the homeless applicant to remain, thus potentially meaning that a woman in a refuge would not be homeless unless evicted by the refuge. The appeals were joined by the House of Lords (Birmingham v Ali and Moran v Manchester [2009] UKHL 36).

To considerable surprise, in Birmingham v Ali, the Lords held that property which it was not reasonable to continue to occupy could still be suitable for the homeless household to stay in “for a short period”, on the basis that the test in section 175(3) of the Housing Act 1996 actually meant “not reasonable to occupy indefinitely”. How long that short period may be was not made clear, just that there will come a time when it is no longer suitable and the household would have to be found suitable temporary accommodation by the local authority.

This issue is certain to give rise to ‘are we there yet’ litigation on the point at which the homeless at home can no longer be expected to stay there. The Lords indicated that, in the face of such a claim, the court “should be slow to accept that this is so, as it is primarily a question for the authority”, but, for those who are unable to stay any longer, there may be no other option.

In Moran, the Lords also found that a women’s refuge will not be accommodation that it would be reasonable for the woman to occupy indefinitely unless there are clear facts indicating that circumstances are otherwise. So, a woman in a refuge will be homeless under section 175(3) of the Housing Act 1996. This is undoubtedly a good outcome for the refuges – but comes at some cost to the homeless at home.

Funding for children accommodation

In R (G) v Southwark [2009] UKHL 26, confessing itself rather surprised to have to deal with this issue, the House of Lords made clear that while a child of 16 or 17 years old may have priority need under the Housing Act 1996, if they are owed a duty under section 20 of the Children Act then they are expressly excluded from Housing Act 1996 eligibility. It is not enough for the local authority to provide accommodation and assistance under what are claimed to be other provisions, in this case section 17 of the Children Act and temporary accommodation under the Housing Act 1996.

Where a child is assessed as meeting the relevant criteria set out in R(A) v Croydon LBC [2008] EWCA Civ 1445, the section 20 duty arises and cannot be side stepped. There is no exercise of discretion in deciding under what power assistance is provided, just an evaluative duty. Social services may ask housing departments to assist in the discharge of the section 20 duty, but this cannot be classed as assistance under the Housing Act 1996.

While the House of Lords considered this finding unsurprising, in October the London Councils’ Leaders’ Committee noted that the case had significant national costs implications and requested that the local government association take this up with central government.

Housing associations as public bodies

The Supreme Court started its housing related decisions with a surprise as well. At the beginning of November 2009, the Supreme Court refused permission to appeal to London and Quadrant in R (Weaver) v London & Quadrant Housing Trust [2009] EWCA Civ 587.

The Court of Appeal had held that London and Quadrant, in its housing function, was carrying out a public function and was therefore a public authority for the purposes of the Human Rights Act 1998 and was susceptible to judicial review. This will have significance for any RSL or housing association that receives significant public funds.

The Supreme Court did state that this was clearly a suitable issue for them, but not the right case, so we await a further case on this issue reaching the Supreme Court. How significant this is for RSL tenants is currently open to question, given the decision in Ahmad, above, and the current position on human rights defences, considered below.

It is worth recalling that Ms Weaver’s challenge to the use of Ground 8 by London and Quadrant failed at first instance. However, challenges to decisions to remove live-in wardens from sheltered housing by housing associations may be strengthened, and the public law defence may be available to those facing summary (and possibly mandatory) possession proceedings.

More differences over the reach of human rights

As predicted last year, Doherty v Birmingham City Council [2008] UK HL 57 has not put an end to the issues over the apparent difference in approach between the House of Lords and the European Court of Human Rights on summary (and perhaps mandatory) possession claims.

The High Court and Court of Appeal set limits on the ‘extended’ gateway B public law defence in Doran v Liverpool CC [2009] EWCA Civ 146, Stokes v London Borough of Brent [2009] EWHC 1426 (QB) and Central Bedfordshire Council v Taylor & Ors [2009] EWCA Civ 613. There was a successful arguable public law defence in McGlynn v Welwyn Hatfield District Council [2009] EWCA Civ 285, on the basis that the council had failed to consider whether there had been significant breach of licence conditions in the year since a notice to quit was served.

The limits appear to be that personal circumstances will be considered, with length of occupation the prime issue, but some situations, like those that parallel Kay v Lambeth LBC, will not give rise to an arguable public law defence (Central Bedfordshire). Both the Court of Appeal and High Court were clear that the extended public law defence did not encompass proportionality or article 8 grounds.

Meanwhile, in Cosic v Croatia, Zehentner v Austria, and Paulic v Croatia, the ECtHR repeatedly reaffirmed the position set out in McCann v UK that the courts must be able to consider the proportionality of the decision to seek possession by the public authority.

Kay v Lambeth is currently with the ECtHR, but meanwhile the Supreme Court has just (6 November) turned down another opportunity to reconsider Kay v Lambeth by refusing permission to appeal in Central Bedfordshire Council v Taylor.

With Manchester CC v Pinnock [2009] EWCA Civ 852 (concerning possession of a demoted tenancy and partly concerned with the article 8 defence issue, awaiting permission to appeal to the Supreme Court) and other cases queued in the Court of Appeal, this one will run for a while yet.

Forthcoming regulation and statute

On 13 November, the Tenants Services Authority set out its response to consultation, preparatory to issuing guidance to RSLs. The TSA may yet end up issuing guidance to local authorities as well. The Equality Bill may address the situation left by Lewisham v Malcolm in the House of Lords, where only direct discrimination is of any effect, although its impact on housing, as currently drafted, will be limited.

Legal aid funding and costs

The new Legal Services Commission contract bidding round has been delayed; bidding will now take place in February 2010. The contracts will still require housing providers to also deliver either family provision or welfare benefits and debt advice. Consortium arrangements will need to be in place.

The Jackson costs review startled many by proposing that fixed costs for fast-track cases would include possession and disrepair cases. This is still under consultation, but fixed costs still remain a fixed idea for Jackson, with a potentially huge impact. As anyone acting for either tenants or landlords knows, disrepair cases are unpredictable and, given that repairs are usually at issue, they are fundamentally different from RTA PI claims.

Unfortunately, the Jackson review appears to be approaching disrepair in the same way as RTA claims, which will not be good news for those acting for either side.
Giles Peaker is a solicitor in the housing and public law department at Anthony Gold Solicitors. For further information email Giles or call 020 7940 4060.

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