West Law Report

Tenancy ends only on delivery of possession

Posted in House of Lords (case), Times Law Report by mrkooenglish on December 20, 2008

From The TimesDecember 15, 2008

Tenancy ends only on delivery of possession
House of Lords
Published December 15, 2008
Knowsley Housing Trust v White
Shepherds Bush Housing Association v Porter
Islington London Borough Council v Honeygan-Green
Before Lord Hoffmann, Lord Walker of Gestingthorpe, Lord Brown of Eaton-under-Heywood, Lord Mance and Lord Neuberger of Abbotsbury
Speeches December 10, 2008

An assured tenancy subject to a possession order ended only when possession was delivered up.

A tenant who did not comply strictly with the terms of a suspended possession order but paid off all arrears and costs, so that the landlord could not enforce the order, was not prevented from returning to the court for a further order.

A secure tenant’s right to rely on a notice exercising her right to buy was suspended when a possession order was made and revived when the order was discharged.

The House of Lords so held when: (i) allowing Julie White’s appeal from the dismissal by the Court of Appeal (Lord Justice Buxton, Lord Justice Longmore and Sir Martin Nourse) ( The Times May 15, 2007; [2007] 1 WLR 2897) of her appeal from Judge Mackay, who, at Liverpool County Court on September 14, 2006, refused her application for a declaration that she remained an assured tenant pending execution of a suspended possession order, in circumstances where she sought to exercise her ostensible right, preserved under the Housing Act 1985, to buy the premises from the landlord, Knowsley Housing Trust; (ii) allowing Oslo Porter’s appeal from the Court of Appeal (Lord Justice Pill, Lord Justice Sedley and Lord Justice Longmore) ( The Times April 2, 2008) affirming Judge Simpson, at West London County Court, who, on December 22, 2006, upheld the district judge’s refusal to discharge the suspended possession order obtained by Shepherds Bush Housing Association in circumstances where Mr Porter did not comply with its terms but subsequently made full payment; (iii) dismissing Islington London Borough Council’s appeal from the Court of Appeal (Lord Justice Pill, Lord Justice Keene and Lord Justice Maurice Kay) ( The Times April, 28, 2008; [2008] 1 WLR 1350) which allowed Manelva Honeygan-Green’s appeal from Mr Justice Nelson ( The Times June 29, 2007; [2007] 4 All ER 818), who held that her right to buy ceased to be exercisable when the council obtained a suspended possession order and was not reinstated when, on full payment of arrears, her secure tenancy revived.

Mr Jan Luba, QC and Mr Adam Fullwood for Mrs White; Mr Edward Bartley Jones, QC and Mr Michael Singleton for Knowsley. Mr Ashley Underwood, QC and Ms Catherine Rowlands for Shepherds Bush; Mr Richard Drabble, QC and Mr Miles Croally for Mr Porter. Mr Andrew Arden, QC and Mr Iain Colville for Islington; Mr Richard Drabble, QC and Mr Adrian Jack for Ms Honeygan-Green. Mr Christopher Baker for the Secretary of State for Communities and Local Government, intervening.

LORD NEUBERGER referred to section 100 of the Rent Act 1977, section 85 of the Housing Act 1985, section 9 of the Housing Act 1988 and the provisions giving a secure tenant the right to buy under the 1985 Act.

A tenancy under the 1977 Act did not determine when the court made a possession order; so long as the tenant was in occupation, it continued until the order was executed: see section 2(1)(a).

Thompson v Elmbridge Borough Council ([1987] 1 WLR 1425) suggested a different position in relation to secure tenants under the 1985 Act, based on section 82(2): that the tenancy ended when the tenant breached the terms of the order.

Unlike those Acts, the 1988 Act gave no express indication with regard to an assured tenancy. Considering Part I of the 1988 Act and in particular section 9, which closely followed section 100 of the 1977 Act, his Lordship concluded that it ended only when possession was delivered up.

The invention of the tolerated trespasser under the 1985 Act led to difficulties and uncertainties as to his rights and obligations which would not arise on his Lordship’s construction of the 1988 Act.

Despite the different position of secure tenants, the correctness of Thompson should not now be reconsidered. In the face of discouragement from highly experienced counsel, it would be wrong to go back on the House’s previous approval of a long-standing decision, acted on in many cases, when amending legislation, under the Housing and Regeneration Act 2008, would prospectively have the same effect as a reversal.

In Bristol City Council v Hassan ([2006] 1 WLR 2582) a form of suspended possession order against a secure tenant was approved which would normally avoid the tenancy determining unless and until the court made a further order.

Contrary to the decision in Marshall v Bradford Metropolitan District Council ([2002] HLR 428), his Lordship concluded that it was open to the court, under section 85, to include a proleptic discharge provision in a suspended possession order.

Section 85(4), if read with the practicalities in mind, did not preclude the court from committing itself in advance to discharge, provided certain conditions were complied with, and neither the landlord, by applying for a possession warrant, nor the tenant, by an application under section 85(2), sought, in the meantime, reconsideration of the terms of the discharge provision.

That view was supported by Payne v Cooper ([1958] 1 QB 174) and Sherrin v Brand ([1956] 1 QB 403), apparently not before the court in Marshall. His Lordship rejected the conclusion in Marshall that discharge under section 85(4) could only be directed if the conditions of suspension, as referred to in section 85(3), were complied with.

Section 85, taken as a whole, common sense and the reasoning in Payne and Sherrin, supported the proposition that the court could also decide the extent to which compliance with the strict terms of the conditions would not be required in order for the order to be discharged.

The terms of a suspended order were to be literally applied and precisely complied with. If a tenant failed to do so, the landlord could apply for a warrant. But if the tenant then applied to the court for relief, the court might suspend or discharge the warrant, and might vary the order.

The order in Mr Porter’s case did not expressly direct proleptic discharge when all payment was made but it provided that the order could not be enforced once full payment was made. The effect of Marshall was that the tenant could not apply under section 85(4) for a discharge unless the terms of suspension had been strictly complied with.

The effect of Swindon Borough Council v Aston ([2003] HLR 610) was that a tenant in such a case could not apply for a variation under section 85(2) either. His Lordship considered Marshall wrong on that issue. So was Swindon; there was nothing in the 1985 Act to prevent a tenant in Mr Porter’s position making an application under section 85(2).

His Lordship rejected Islington’s argument that the right to buy pursuant to a notice served under section 122 of the 1985 Act was lost once a secure tenancy was determined under a possession order and that it could not be retrospectively reinstated when the secure tenancy retrospectively revived by subsequent discharge of the order.

Section 121 suspended a tenant’s ability to exercise or pursue the right to buy while any of the situations identified in that section obtained: but did not remove the right permanently.

Accordingly, the right to buy pursuant to a notice already served under section 122 was not permanently lost once the tenant was obliged to deliver up possession. It revived retrospectively once the possession order was discharged.

Lord Hoffmann and Lord Brown agreed; Lord Walker delivered a concurring opinion; Lord Mance delivered an opinion concurring in the result.

Solicitors: Keoghs & Nicholls, Lindsell & Harris, Altringham; Anthony Collins Solicitors LLP, Birmingham. Prince Evans, Ealing; Sharpe Pritchard, for Oliver Fisher. Louise Round, Islington; Wilson Barca, Upper Holloway. Treasury Solicitor.

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