Making out of borough offers

Jeremy Ogilvie-Harris and Hannah Taylor look at how conscientious and lawful out of borough offers of accommodation under Part 7 of the Housing Act 1996 can be made.

The familiar pressures and difficulties of finding accommodation for applicants under Part 7 Housing Act 1996 (‘the 1996 Act’) has led to London-based local authorities (‘LAs’) searching for and offering accommodation outside of their areas. However, given the impact on applicants of being offered accommodation hundreds of miles from where they been living, it is important that LAs get their duties in this context right. Since the Supreme Court decision in Nzolameso v City of Westminster [2015] UKSC 22, the courts have frequently revisited the question of when an out of borough offer would be lawful.

This article focuses on the operation of sections 206 and 208(1) of the 1996 Act in the context of out of borough offers and how the courts have interpreted this. It is structured into three sections. First, we set out an overview of the legislation and case law in this area. Second, we analyse the developments in the recent case law and the key principles that can be taken from it. Finally, we provide some practical tips on how and when local authorities can make lawful offers of out of borough accommodation.

Section 1: Overview of the law

Overview of the Legislation and Statutory Guidance

In discharging their duties under the 1996 Act, local housing authorities are under a duty, imposed by section 208(1), to “so far as reasonably practicable […] secure that accommodation is available for the occupation of the applicant in their district”. Section 206 of the 1996 Act provides that a local housing authority may only discharge their duties under the 1996 Act by securing “suitable” accommodation, through one of a number of routes. The ordinary tests for suitability will apply in this context: e.g. affordability (see Paley v London Borough of Waltham Forest [2022] EWCA Civ 112) and compliance with the public sector equality duty (see Webb-Harnden v London Borough of Waltham Forest [2023] EWCA Civ 992).

Article 2 of the Homelessness (Suitability of Accommodation) (England) Order 2012 (‘the Suitability Order 2012’) makes it a matter of statutory obligation for local housing authorities to take the location of the accommodation into account when determining whether accommodation is suitable. To determine whether the location of the accommodation is suitable the local housing authority must take into account a range of factors, including the distance of the accommodation from the local authority’s area, the significance of disruption that would be caused to the household, and the proximity of the offered accommodation to medical and support facilities, local services, amenities and transport.

Further guidance on out-of-borough placements is provided in the Homelessness Code of Guidance (“the Guidance”), which housing authorities are required to have regard to in accordance with s.182(1) of the 1996 Act. We do not intend to set this out in full here, but we refer review officers and lawyers to §§17.48-17.68 with a particular emphasis on §17.51.

Overview of the case law

The leading case on sections 206 and 208(1) and out of borough offers is Nzolameso. The appellant was a single mother of five children, and she had serious health problems. Westminster City Council offered her temporary accommodation in Bletchley, near Milton Keynes, which she rejected as unsuitable. Baroness Hale DPSC held “[r]easonable practicability” imports a stronger duty than simply being “reasonable” (at §19). If it was not reasonably practicable to place an applicant in borough, the LA should “try to place the household as close as possible to where they were previously living” (ibid). Applying this test, she found that the Council did not make any inquiries before the decision was taken to assess whether it would be practicable for the family to move out of Westminster. Further, there was no evidence about the accommodation available in or near to Westminster and why that had not been offered to the applicant. There was also no evidence of the Council’s policy in how it decided to offer out of borough accommodation, or that the Council was even aware of their obligation to offer accommodation as close as possible to Westminster if accommodation in Westminster was not possible. In the circumstances, Westminster had not complied with their legal obligations towards the appellant under the 1996 Act.

In giving “guidance” as to how LAs can make lawful out of borough offers, Baroness Hale DPSC emphasised the importance of:

1. Producing evidence of what resources were available to the LA and how it decided that that accommodation should or should not be offered to the particular applicant (at §38).
2. Having procurement and allocations policies so that these could be referenced in decision letters to evidence compliance with sections 206 and 208(1) of the 1996 Act (at §39).

The principles arising from Nzolameso have been developed and clarified in subsequent case law. In Alibkhiet v Brent LBC [2018] EWCA Civ 2742, Brent had a policy dealing with which applicants would be prioritised for accommodation either in-borough or in Greater London. It was accepted that Mr Alibkhiet was not in any of the priority categories, and he was offered accommodation in the West Midlands. On appeal to the County Court, Brent exhibited a spreadsheet showing details of the available properties at the time the offer to Mr Alibkhiet was made. Two properties, one in borough and one in an adjacent borough, were available at the time that Brent offered of the flat in the West Midlands to Mr Alibkhiet.

The Court of Appeal held that the courts should be wary of taking an overly technical approach to decision letters which risks “judicializing” welfare services (§§36-38). If there was available accommodation in borough, it does not follow that the authority must offer it to an applicant, because the LA may retain units for future applicants who, for example, are in an emergency situation (§46(ii)). In principle, where a LA had a lawful policy on out of borough placements, which was implemented correctly in an individual case, the decision would be lawful (§§47-48).

The Court of Appeal continued that, in some circumstances, it may be necessary for the LA to consider whether accommodation would become available such as where a development approaching completion may provide suitable accommodation (§75). However, it was not incumbent on the LA to wait on the off chance something might become available (§75), nor to carry out an extensive search in every estate agent in every town or city between London and the Midlands (§80). On the facts, it was lawful for Brent not to offer the properties in Greater London to Mr Alibkhiet because on a correct application of their policy, he did not qualify for priority for housing in Greater London (§66-67) and they had not erred in offering accommodation in the Midlands.

In Abdikadir v Ealing LBC [2022] EWCA Civ 979 the court found that Ealing had a lawful policy for out of borough placements and a lawful acquisitions policy which required the council’s acquisition officers to “focus on zone 1 and zone 2 areas first … Acquisition officers liaise with accommodation providers and check relevant websites on a daily basis for new supply” (§50). However, Ealing had failed to properly evidence or explain in any of their decision letters, nor at appeal, whether they had investigated the availability of private sector property and had thereby failed to evidence compliance with their policy (§57). Accordingly, Ealing could not demonstrate that it had complied with sections 206 and 208(1) of the 1996 Act.

Zaman v Waltham Forest LBC [2023] EWCA Civ 322 was held to be analogous to Abdikadir. The court found that Waltham Forest’s “Accommodation Acquisitions Policy” was lawful but, again, the Council provided insufficient evidence to show that the policy had been followed. The argument that, once an applicant was categorised as being an “out of London” case, they could be placed anywhere in the UK was firmly rejected by the Court of Appeal because of the operation of section 206 of the 1996 Act and the Suitability Order 2012 (§46(iv)). The court held that regardless of having a policy, it was necessary to show compliance with the Nzolameso principles. Waltham Forest had provided insufficient evidence that the Council sought accommodation any closer than Stoke-on-Trent in a context in which a Freedom of Information request revealed that around 40% of Zone C properties being offered by Waltham Forest were located in Stoke-on-Trent (see §51). In the absence of this evidence, and where the review officer “did not say that the Procurement Team prioritised properties closer to the borough or give any reason for so many Zone C properties being as far away as Stoke-on-Trent” (§52), the decision was unlawful.

In Moge v Ealing LBC [2023] EWCA Civ 464, Snowdon LJ found that a local authority plainly should not have to give “chapter and verse on each and every internet search and property inquiry that its officers made to find accommodation as close as possible to an applicant’s previous home or place of work” and that the level of detail required to show compliance will depend on the facts of the particular case (§122). The Council applied to adduce a fresh witness statement on appeal to evidence how the Council’s officers complied with their acquisitions policy, and the application was very narrowly allowed. Thus, on appeal, the information adduced to evidence compliance with the acquisitions policy comprised a witness statement describing in general how its officers search for available accommodation; the fact that the Council’s officers did find an earlier property in Ealing before the instant offer was made; and email chains that showed that the officers had compiled a list of available properties in Ealing and surrounding boroughs. In this case, the court found that “albeit by a narrow margin” (§121), the evidence provided was sufficient to show that Ealing complied with their duty to find accommodation as close as possible to Ealing. The evidence was only “just” sufficient to show it had lawfully complied with its acquisitions policy (§130).

Section 2: Analysis

There is, therefore, a two-part test to apply when determining whether to offer a household accommodation that is out of the borough. First, is it reasonably practicable to secure accommodation within the borough? Second, if it is not reasonably practicable, has the LA sourced and offered accommodation which is as close to the borough as possible?

Nzolameso set a high watermark as to what LAs would be required to do to establish that they had lawfully offered accommodation out of borough. However, it is important to note that the Supreme Court was faced with a case where Westminster had provided insufficient evidence or explanation as to why the applicant had been offered accommodation outside the borough. In particular, Westminster provided “no evidence of their policy in relation to the procurement of accommodation […], nor of the location of that accommodation, nor of the instructions given to the temporary lettings team as to how they are to decide which properties are offered to which applicants” (at §8). This was, really, a decision on adequacy of reasons (see Abdikadir at §§36-37).

In one sense, Nzolameso, read in conjunction with the recent R. (on the application of Imam) v Croydon LBC [2023] UKSC 45 case, demonstrates a trend in homelessness law for the courts to require LAs to provide an evidence base in justification of their decisions, where the issue is allocation of scarce resources (see e.g. Abdikadir at §39). However, there is a key difference between Imam and Nzolameso: the evidential requirements for avoiding a mandatory order are more exacting that those for justifying a decision to offer accommodation out of borough. The courts in an appeal under s.204 of the 1996 Act of a decision to offer accommodation out of borough are applying principles of judicial review (Runa Begum v Tower Hamlets LBC [2003] UKHL 5 at §7) rather than deciding the matter for itself (Imam at §55). The County Court will be considering whether the out of borough offer was legal (i.e. in vires), rational (both in terms of relevant/irrelevant considerations and Wednesbury reasonableness), procedurally fair and adequately reasoned.

Accordingly, the recent case law has approached the question of compliance with section 208(1) of the 1996 Act applying public law principles. As Alibkhiet makes clear, the courts wish to avoid the judicialization of welfare services (at §36) and onerous duties are not intentionally being placed on LAs (at §38). Where the LA has a lawful policy and applied that policy correctly in an individual case, that decision is very likely to be lawful (at §48). It is for local authorities, with their particular expertise and knowledge, to determine how limited resources will be allocated. The cases in which the courts find out of borough placements to be unlawful are those where the LA has provided insufficient explanation or evidence as to whether there was accommodation closer to their borough.

Most LAs have since adopted procurement and allocations policies which create three areas of accommodation location. For instance, Waltham Forest has Zone A for in-borough accommodation, Zone B for Greater London and surrounding areas and Zone C for the rest of the UK. Westminster has Band 1 for Westminster and adjacent boroughs, Band 2 for Greater London, and Band 3 for the rest of the UK. However, while Nzolameso established that a LA should have a published policy explaining the factors that will be taken into account when deciding whether to offer accommodation out of borough, in Abdikadir, the Court of Appeal held that it is not sufficient simply to have a policy on how the Council will comply with their duty in s.208 of the 1996 Act: LAs must also adduce evidence to show that they lawfully applied the policy in the individual cases.

This requirement was emphasised again in Zaman. Crucially, where 42% of out of borough offers were in Stoke-on-Trent, this substantially undermined the argument that Waltham Forest had tried to procure accommodation closer to London and the evidence of the steps usually and in fact taken to source accommodation (provided in a witness statement during the section 204 appeal) was insufficient to demonstrate compliance with section 208(1). This can be contrasted with Moge where a similar witness statement was considered to be sufficient, albeit only just. There is a balance to be struck here between the courts recognising the difficulty, in resource-stretched councils, of requiring evidence of every internet search being undertaken with the importance of ensuring LAs are complying with their statutory obligations. To those following this area of the law, as noted by the Court of Appeal itself, the approach to evidence in section 204 appeals challenging compliance with sections 206 and 208(1) could be said to be unsatisfactory insofar as, due to the inherently subjective nature of public law determinations on sufficiency of evidence, there is a very fine line between a lawful and unlawful decision letter.

In this context, two key issues are likely to arise in appeals under s.204 of the 1996 Act:

1. Has the LA provided evidence to show that it was not reasonably practicable to procure and offer accommodation in their borough (section 208(1) HA 96)?
2. Has the LA provided evidence to show that it procured and offered accommodation as close by to their borough as possible (the Suitability Order 2012 point)?

Section 3: Tips for making lawful offers of out of borough accommodation

The starting point is that LAs should have up to date procurement and allocations policies in relation to Part 7 accommodation. These should be informed by the LA’s legal obligations under the 1996 Act, Children Act 2004, Equality Act 2010 and Human Rights Act 1998, its estimation of the required housing needs in its area and its practical experience of finding accommodation in-borough and out-of-borough. It should be clear from reading the policies what the criteria will be for the allocation of accommodation in-borough or out-of-borough. These policies should be referred to and applied in decision letters. Unless an allocations policy provides for it, the availability of Part 6 accommodation is generally irrelevant to the tests under sections 206 and 208(1) in this context (Moge at §137).

It is unlikely to be lawful if LAs only procure out of borough accommodation that is very far from its district, as was successfully argued in Zaman. Not only does this approach carry litigation risk, it risks applicants refusing offers placing financial strain on social services (who have to step in to assist households with children) and carries social costs. Accordingly, when London LAs are procuring accommodation, they should divide the UK up into “concentric circles”. By this, we mean that the “out of Greater London” area should be divided up by regular intervals in distance from, or by connectivity to, the LA’s area. Searches for available accommodation should be made in each of these areas. These searches should be recorded (see below). This will allow the LA to evidence that it has looked for/procured accommodation as close as possible to its district.

It is unlikely to be sufficient to state in a decision letter or witness statement the general or usual practice of procuring accommodation in the absence of evidence of actual steps taken. It will be easier to justify a decision to offer out of borough accommodation if the LA has maintained a record of the accommodation that was available at the time of offer, how that accommodation was identified, and why the non-offered accommodation was not considered appropriate to the individual applicant. Practically, this can be done by keeping a spreadsheet for each household which sets out the available accommodation, the bedroom size and location, whether the accommodation would be affordable and, if not, why not, and any other reasons that that accommodation was not offered to the applicant (e.g. because it was being offered for a higher priority household or was reserved for emergency cases). This can be drawn on during the section 202 review to give evidence and explanations which evidence compliance with sections 206 and 208(1) of the 1996 Act.

It is important to note that if a decision is challenged, it is critical that evidence of compliance with the LA’s policies is provided at an early stage. In Moge, Ealing waited until the appeal from the County Court decision to adduce evidence that they complied with their acquisition policies, and the court’s reluctance to grant this application for fresh evidence was clear: it was only “just” allowed (§108). Further, the content of the evidence itself was only “just” sufficient (§130). There is no guarantee that a respondent LA in a section 204 appeal will be permitted to rely on late evidence retrospectively demonstrating compliance.

A practice which can be effective is for the review officer to check available accommodation on the date of review request and date of minded to letter. While, where a final offer has been made, there is no legal requirement to continually check whether there is available accommodation at the date of review (see Alibkhiet at §75), it is good practice to do so and can provide strong evidence of compliance. If an applicant is in out of borough temporary accommodation, there is a continuing obligation to consider suitability and, therefore, a legal obligation to consider the circumstances at the time of the review: Waltham Forest London Borough Council v Saleh [2019] EWCA Civ 1944.

Finally, as in all cases, LAs need to consider the particular needs of a household and whether, in light of those needs, the location of the offered property is suitable. These are the usual considerations such as affordability, the Suitability Order 2012, and the public sector equality duty.

Jeremy Ogilvie-Harris and Hannah Taylor are pupil barristers at Cornerstone Barristers.