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Housing case law update - May 2021

Michael Owen, Natalie Hurst and Jatinder Bhamber round up the latest court rulings and Ombudsman decisions of interest to housing associations and local authorities.

Aster Communities v Chapman and others [2021] EWCA Civ 660

Court of Appeal, 7 May 2021

The Court of Appeal has ruled that courts may impose certain conditions upon a landlord when permitting an application for dispensation from statutory service charge consultation requirements.

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The landlord (Aster Communities) owned several flats which were let on long leases. It carried out various works to the flats and subsequently sought to recover the cost of the works from the lessees through the service charge. Prior to the commencement of the works, Aster Communities conducted a consultation with the lessees under sections 20 and 20ZA of the Landlord and Tenant Act 1985, but failed to mention certain works (i.e. asphalt replacement) that were eventually carried out, meaning that the consultation process was defective. Aster Communities applied to the First-tier Tribunal for dispensation from the statutory consultation process for the omitted works. The First-tier Tribunal held that it could grant dispensation, but subject to Aster Communities (1) paying “reasonable” costs to the lessees so that they could obtain expert advice from a surveyor as to whether the asphalt replacement works were necessary; (2) paying the lessees’ “reasonable” costs for the dispensation application; and (3) accepting that it could not recover its legal costs through the service charge. Aster Communities appealed against the first two conditions, but the Upper Tribunal upheld the decision. Aster Communities appealed.

The Court of Appeal, in dismissing the appeal, held that the lessees needed expert advice, otherwise they would not understand the importance of the failure to consult – if the surveyor advised that the asphalt works were not necessary, then the lessees could challenge the service charges. It also held that the condition which required Aster Communities to pay the lessees’ costs of the dispensation application was similar to a condition previously imposed in Daejan Investments Ltd v Benson [2013] UKSC 14 and therefore was permissible.

The ruling highlights that landlords that want to apply to dispense with statutory consultation requirements should fully consider whether their lessees will be prejudiced as a result of their actions and be aware of the potential conditions that a court may impose upon them for doing so.

A copy of the judgment is here.

Allen v Ealing LBC [2021] EWHC 948 (Admin)

High Court, 20 April 2021

The High Court has held that a notice served under the Environmental Protection Act 1990 is valid when it is sent to the relevant local authority and it does not have to be addressed to the Secretary or Clerk.

A tenant (Ms Allen) of a flat owed by Ealing London Borough Council alleged that the property had suffered from an infestation of mice for several years. She wanted to bring a private prosecution against the Council and served notice by recorded delivery under section 82(6) of the Environmental Protection Act 1990. The letter was addressed to “The London Borough of Ealing” at the Town Hall, but not to the “Secretary or Clerk”, who were the individuals identified in section 160 of the Environmental Protection Act 1990. The letter was received and signed for, but was not passed to the Council’s housing litigation team. Ms Allen received no response and she subsequently issued legal proceedings.

The District Judge held that the notice had not been properly served. Ealing London Borough Council was a “body corporate” and the notice should have been addressed to the Secretary or Clerk at the Council. The Court had no jurisdiction to issue the summons. Ms Allen appealed.

The High Court, in allowing the appeal, held that the requirements of section 160 of the Environmental Protection Act 1990 were permissive, not mandatory. The notice did not have to be given to the Clerk or Secretary of a body corporate, or an “identifiable person or department in the Council”. The notice complied with section 160 and was validly served if it was delivered or posted to the principal place of business of the body corporate.

A copy of the judgment is here.

R (Elkundi) v Birmingham City Council [2021] EWHC 1024 (QB) (Admin)

High Court, 23 April 2021

The High Court has held that a local housing authority’s system for allocating accommodation to homeless applicants under the Housing Act 1996 regime is unlawful.

Four applicants, some of whom had health issues or a disability or were responsible for a family member with a disability, had made separate applications to Birmingham City Council for accommodation under the homelessness provisions in the Housing Act 1996.

Birmingham City Council accepted that it owed the four applicants a housing duty and they were placed on a “Planned Move List” (“PML”) – this was a list of housing applicants who needed to move from one type of temporary accommodation to another, divided into separate “queues” according to how many bedrooms were required. The fact that an applicant was on a PML did not mean that Birmingham City Council accepted that the applicant’s current accommodation was unsuitable. When a property became available, it was offered to the applicant who had been waiting the longest for that type of property, although an applicant could be prioritised if there were exceptional circumstances.

The four applicants issued judicial review proceedings against Birmingham City Council, alleging that they had been left for an unreasonable amount of time in unsuitable accommodation and, thus, the Council had breached its duty under the Housing Act 1996. Birmingham City Council deemed that the accommodation was suitable in the short term until alternative accommodation had been identified.

The High Court held that Birmingham City Council’s system for allocating accommodation to homeless applicants was unlawful and it had therefore breached its duty. It granted a declaration that the duty under the Housing Act 1996 is “unqualified, immediate and non-deferrable” and that the Council’s system of putting applicants who are owed the duty, and whose accommodation is currently unsuitable, onto a waiting list for temporary accommodation is “not a lawful means of performing the duty”.

Birmingham City Council has said that it will appeal the ruling.

A copy of the judgment is here.

Keshwala v Bhalsod [2021] EWCA Civ 492

Court of Appeal, 15 April 2021

The tenants leased a shop that included living accommodation above it. The tenants planned to open a hairdressing business in the property and paid significant sums of money to refurbish the premises in 2018. One of the tenants, entrusted to pay the rent by the other, mistakenly paid £500 less in rent in June 2018. An invoice for rent from the landlord's property agents in September 2018 made no reference to the outstanding £500 but, later that month, the landlord effected forfeiture by re-entry pursuant to the terms of the lease using the services of bailiffs. The second tenant then became aware that there had been a shortfall in the rent and that there had been a re-entry. He arranged for the prompt payment of the outstanding £500. In February 2019, the landlord re-let the commercial and residential parts of the property in separate leases and the tenants issued a claim for relief from forfeiture. However, the County Court refused to grant relief due to the tenants' delay in making their application. The tenants appealed.

The High Court, in allowing the appeal, held that an application for relief that is brought within six months is to be taken as having been brought with “reasonable promptitude”. A delay within the six month limit did not amount to the kind of “exceptional circumstances” that was necessary for a landlord to show when asking the Court to refuse relief. The landlord appealed

The Court of Appeal, in allowing the appeal, held that there is no legal principle that an application for relief from forfeiture made within the six-month deadline is deemed to have been made with sufficient promptness. Consequently, an application can be dismissed for lack of promptness even if it is made within six months. A tenant applying for relief from forfeiture must act with due diligence, keep the landlord informed of their intentions and explain any delay.

A copy of the judgment is here.

Moss v Royal Borough of Kingston Upon Thames [2021] EWHC 1032 (Admin)

High Court, 23 April 2021

The High Court has held that a local authority had acted unlawfully in refusing a request to inspect its financial records under the Local Audit and Accountability Act 2014.

Under section 26 of the Local Audit and Accountability Act 2014, Mr Moss had submitted a request to inspect various documents, including invoices and supplier contracts, relating to the Royal Borough of Kingston upon Thames' housing stock. Royal Borough of Kingston upon Thames spent two weeks collating 400 documents, but refused to provide certain documents as they contained personal information, such as the names of tenants, and commercially confidential information. It then said that it would not spend more time on the request, arguing that that it was unlikely that Parliament had intended to allow an individual to inspect every document within the scope of section 26, irrespective of the considerable time and money involved in complying with the request. Mr Moss contested this.

The High Court held that that Royal Borough of Kingston upon Thames had acted unlawfully in refusing to fully carry out Mr Moss’ request. It held that (1) there was no provision in the Act for a local authority to refuse to process a document inspection request based on the time it would take, and that (2) section 26 of the Act does not contain a proportionality-based control mechanism, which suggests that Parliament intended that the right to scrutinise a local authority's financial documents should not be curtailed by the length of time it takes the local authority to comply.

The decision is likely to impose a significant time and cost burden on local authorities.

A copy of the judgment is here.

Investigation into a complaint against Medway Council (reference number: 20 004 585)

Local Government and Social Care Ombudsman, 23 February 2021

The Local Government and Social Care Ombudsman has found that Medway Council let down a mother and her teenage son when dealing with their homelessness.

A mother (Ms E) and her teenage son became homeless at the end of 2018. The Council placed them in temporary accommodation while it dealt with their homelessness application. The Council subsequently decided that Ms E was intentionally homeless in February 2019, but she was not evicted from temporary accommodation as the Council had child protection duties. There was no written agreement (licence or tenancy) for the temporary accommodation.

In July 2020, Medway Council asked them to leave the temporary accommodation, resulting in Ms E and her son sleeping in a tent. Ms E contacted Medway Council to say she was homeless and, as asked, filed a change of circumstances form. However, Medway Council took no action. In September 2020, Ms E contacted Medway Council, with the help of the charity Shelter, but she was told that it would not provide her with temporary accommodation (as Ms E was previously intentionally homeless) and that she should find her own private rented accommodation. Ms E complained to the Local Government and Social Care Ombudsman.

The Local Government and Social Care Ombudsman told Medway Council to review the case, and Ms E and her son were placed in Bed and Breakfast accommodation. They were subsequently moved to a self-contained two-bedroom property. The Ombudsman found that Medway Council had been at fault in the way that it had dealt with the family and that it had failed in its duties to a vulnerable teenager who was sleeping rough. It recommended, amongst other things, that the Council pay compensation to the family and provide refresher training for staff in its housing allocations and housing options teams.

A copy of the decision is here.

Michael Owen is Head of Housing Management, Natalie Hurst is an associate and Jatinder Bhamber is a Chartered Legal Executive at Capsticks.

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