Tenant wins battle with city council over allocation of housing disrepair case to fast track

A Senior Circuit Judge has backed a tenant in a dispute with Bristol City Council over whether her housing disrepair claim should be allocated to the fast track.

Neil Smith, of 8PP Barristers & Associates, who is acting for the claimant, said that while a county court level judgment is not a binding precedent, the matter had been reserved to HHJ Blohm KC to provide guidance to judges in the Bristol County Court when dealing with similar cases.

Smith said this decision “provides crucial support for claimants facing similar allocation arguments from landlords and local authorities”.

This was because it found internal complaints procedures (ICPs) do not override a tenant’s right to litigate and are not relevant to issues surrounding allocation decisions, which should not be influenced by a landlord’s financial position.

The decision also suggested that local authorities can be subject to specific performance orders for outstanding repairs even where they are either willing to, or are trying their best to carry out repairs, and that repair costs should be assessed objectively based on market value rather than the actual cost to a particular landlord.

For social landlords, particularly councils, the judgment “signals a warning that attempts to avoid fast track allocation will face strong judicial scrutiny,” Smith said.

“Attempting to, but failing to carry out repairs, is not enough to avoid an order for specific performance and this should be taken as the position for allocation purposes.”

He said the ruling strengthened the case for fast track allocation in disrepair claims exceeding £1,000 in value where there is a live claim for specific performance at allocation stage.

The court’s rejection of the council’s financial hardship arguments suggested broader public policy concerns will not outweigh claimants’ rights in track allocation decisions, he added.

The tenant had complained of serious disrepair at her property.

Bristol argued tenants must complete their internal complaints process (ICP) before issuing proceedings, and contended that courts should not order specific repair where the landlord is making efforts to fulfil its obligations.

The council also said the financial burden of allocating cases to the fast track should be taken into account, citing a significant rise in housing disrepair claims.

HHJ Blohm KC said: "The failure of the claimant to engage with ICP (if this is correct) is not a matter that is pertinent to allocation. If a litigant does not engage with appropriate Alternative Dispute Resolution (‘ADR’), then the other party may apply for an appropriate stay for the process to be worked through. That is what happened in this case, and the court directed accordingly.

"If a party still considers that the process has not been carried out and should be further proceeded with, than a further application may be made. That has not occurred in this case and hence the matter has proceeded to allocation. If a party has wrongly refused to entertain ADR, then that is a matter that the court can and will take into account in determining and assessing costs at the conclusion of the case."

The judge continued: “The broader argument is I think this. The scheme for funding litigation in the fast track is such that specialised solicitors who deal with similar claims in bulk can make significant sums of money in fees by acting for tenants who have disrepair claims, usually funded on a CFA backed by after the event insurance. This is similar to the model used by solicitors acting for other multiple individual claimants in for example PPI or motor finance claims.

“The difficulty with this type of claim is that what is sought is not simply monetary compensation (although that is a not insignificant part of it) but actual performance of obligations where the resources of local authorities as housing providers is necessarily limited, and where the claims appear to multiply as fast as they can be generated by word processor. In these circumstances there may be a policy benefit in slowing down the claims by requiring them to go through the ICP as well as in reducing the litigation costs that come from a finite pot of money.”

HHJ Blohm KC suggested that the difficulty with this argument is that a stay can be sought where the litigation is premature, but where a stay has been granted or is not sought, that is no longer material; the claimant is entitled to proceed with her case. “Allocating the case to the small claims track where the claim is, considered on its own merits, appropriate for allocating to the fast track, would in my view be wrong. If claims such as those should not be subject to the fast track costs regime or not subject to litigation, then that is a matter for Parliament or the Rules Committee to deal with. There is an argument that it is only the availability of legal assistance by such means that confers a timeous remedy on those without means who need it. That is not for me.”

He concluded that the effect of allocation on the housing function of the defendant council is not a matter that should ordinarily have weight in respect of an allocation decision.

The judge earlier said there was no existing authority to support Bristol’s position that a contracting party, who was trying but failing to perform its contractual obligations, was immune from an order for specific performance

He also held that allocation decisions between the two tracks should be based on legal and factual merits, not budgetary or public policy concerns, with repair costs based on open market estimates.