Pinnock & Beyond! – a note from the Past

Since the Court of Appeal decision in Weaver v London & Quadrant (2009) which decided that most social landlords were public bodies for the purpose of Human Rights law, especially when it came to Article 8 (the right to a home) it has been clear that there were going to have to be changes in how all the mandatory grounds of possession – those that didn’t depend on the discretion of a judge – were handled, in order to avoid challenges on public law grounds. It was argued that if a judge didn’t make the final decision because his hands were tied by the legislation the landlord’s decision to issue the proceedings could be challenged as a breach of (usually) article 8.

The standard required for the landlords, however, are not too rigorous – you just have to have a fair procedure and not make unreasonable decisions.   But what is “unreasonable” and in particular does it incorporate the Human Rights concept of “proportionality”? It might be reasonable to try and recover possession of your house if the tenant is in arrears of the rent, but is it proportionate if he is only a few pounds over the 2 month limit for Ground 8 HA claims and he’s lived there for 20 years?

Up until now this has been a distant threat anyway as these sort of challenges have had to be made by way of Judicial Review applications in the Administrative Court, and  few tenants can afford to do that. The worst that might happen in the County Court possession case was that if such an application was made the court might adjourn the hearing pending the result of an application for permission for JR, which was rarely granted.

Well, things are set to change. The Supreme Court decided on 3rd November in Manchester CC v Pinnock [2010] UKSC 45 that in a claim over a demoted tenancy the County Court had jurisdiction to decide the proportionality point – was the decision to go for possession disproportionate, bearing in mind the landlord’s other duties and requirements? This should be decided summarily and the objection dismissed unless it clearly had merit. If it had then this might mean that a claim which was otherwise irresistible resulted in an extended period before possession, or a suspended order, or even the claim being dismissed.

Does this matter? There are very few claims involving demoted tenancies. The Supreme Court declined to give general guidance, pointing out that it would shortly hear Salford v Mullens covering introductory tenants and homelessness non-secure tenants and others and that would be a better case to use for guidance. The case was due to be heard on 23/24 November but the decision may be some time off, and the final details must wait until then.

However, there is some clear guidance that can be given at this stage to avoid potential problems in the future. And it is all good practice in any event:

  • The claims most at risk in the social housing area are
    • Ground 8 HA 88 (2 months rent arrears)
    • S 21 HA 88 (ending ASTs – used for intermediate and introductory tenancies)
    • Notices to quit or forfeiture brought by fully mutual housing associations, where there is no security of tenure
    • Homelessness licences, demoted tenancies
    • Claims against trespassers.
  • In each case the landlord should
    • Gather information about the facts – how much rent is in arrears, and why? What does the tenant do? Have they any children? Are there disabilities etc? And record this.
    • A manager should decide how to proceed and set down the reasons for their decision in writing.
    • If circumstances change significantly a manager should review the decision and again record their decision and reasons in writing.
  • It may help to have written guidance but ultimately somebody must be allowed to look at the bigger picture and make a decision which they feel they can justify. This must include being proportionate, and taking into account the effect that the decision will have on the tenant as well as the extent of the fault – the amount of the arrears, the degree of disturbance or whatever.
  • Some cases are easy – a Ground 8 claim against a shared ownership tenant with a mortgagee is virtually always justified, as the mortgagee will pay up and the tenant’s home is not seriously at risk. And there are very few times when it is unreasonable to remove squatters. Here the paperwork can be pretty simple.
  • But other cases need proper detailed recording if you are to avoid the risk of having the claim upset, or seriously delayed, by a successful challenge in the County Court. And it may be easier in some cases to proceed under a discretionary ground (eg Ground 10) when it is the Judge who has to make the decision.

There are likely to be some changes in court procedure to take this into account and maybe more guidance, which we will pass on as soon as possible.

And those in the know suspect that something similar may spread into the private landlord field, as Human Rights make little distinction when it comes to such basic things as having a home.

[Post prepared 23.11.10]

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Pinnock on Steroids

Hounslow v Powell; Leeds v Hall; Birmingham v Frisby [2011] UKSC 8

The Supreme Court has heard three more claims in relation to various types of possession claims where the tenants are not secure and has decided that the Article 8 ECHR right to a home means that the court has a power to consider a proportionality defence to a possession claim. This means that all social landlords will have to revise their procedure for bringing possession claims and expect a far higher level of scrutiny from the courts.

The cases involved introductory tenancies under part V of the Housing Act 1996 or homelessness licences under part VII. This follows on from Manchester v Pinnock (2010) which related to demoted tenancies. The details do not matter in themselves: what is important is that it now seems almost certain that all possession claims by public bodies (which following Weaver v L & Q include most social landlords) are going to be covered, including Ground 8 claims (8 weeks arrears of rent).

In the future it appears that possession claims are going to divide into two groups:

  • Discretionary claims – eg Ground 10 arrears of rent  – where the court has to be satisfied that it is reasonable to make an order. The court has a discretion, and makes the decision. These cases are not affected, as the court already decides, as a matter of course, on the proportionality of an order.
  • Mandatory claims, where the court has no discretion on making the order, provided that the Landlord has followed the correct procedure. This includes the mandatory grounds 1-8 of Housing Act 1996, s21 claims for possession of assured shortholds, and claims for possession of demoted tenancies, introductory tenancies, homelessness licences, and other similar claims, including the new mandatory grounds at the end of the fixed term tenancies being proposed by the government.

In Mandatory claims the court will be able to decide whether making an order is proportionate, and if it is not can decline to do so, even if there are no other grounds to refuse.

The procedure is meant to be:

  1. The court only considers proportionality if it is raised by the Defence;
  2. The court must consider that the issue is seriously arguable;
  3. The court then decides if making an order for possession is a proportionate means of achieving a legitimate aim – eg to vindicate the Landlord’s property rights, or enable the landlord to allocate and manage its housing stock.
  4. Any decision must set out a reasoned judgement on how a fair balance is being struck.

However, we have considerable doubts on how this will operate in practice, in a busy housing list before a harassed District Judge or Deputy. Already anecdotal evidence seems to indicate that some Defence lawyers raise proportionality in every case, and ask for an adjournment so they can plead it, while Judges frequently raise these points themselves, and seem to consider that this is the same test as Discretionary claims, which it is not.

Perhaps there will be further guidance, or alterations to the rules to try and sort things out. However, until things sort themselves out the clear guidance must be to treat all possession claims as discretionary and prepare the evidence accordingly. Why is it proportionate or reasonable to make an order? And consider whether it might be better to bring the claim under one of the truly discretionary grounds – such as Ground 10 rather than Ground 8, and sidestep the problem.

Declaration of Presumption of Death

“If somebody goes missing for at least 7 years a court can declare them dead.”

Well, not exactly. They can make various orders on the basis that they are dead – eg payment out of life insurance and unit trust monies. Many professionals are vaguely aware of this. However, it is extremely uncommon in practice, and when it does it is useful to have clear guidance on what to do.

This is provided by the Bayes-Walker case [Bayes-Walker v Bayes-Walker  [2010] EWHC 3142 Ch] involving an RAF Sergeant who went missing from his base in Cyprus and was last heard of in Israel. Mr Justice Warren gives a checklist in less than 3 pages of transcript setting out everything you need to know. And so when you are approached you can get it right first time.

_________

Note: this does not apply to the far more common case of the death in an accident when the body cannot be found. If there is clear proof that the person was say on the aeroplane that crashed then a coroner can certify death in the normal way. You don’t have to wait for 7 years.

Nor does it prevent say a divorce occurring on the basis of 5 years separation, or even unreasonable behaviour by not contacting the spouse for some shorter time. Subject of course to the problems of service in both cases.

Are wills any use following Ilott v Mitson?

NOTE – This piece is about the 2011 CA case. For the 2015 CA case see here. For the 2017 SC appeal see here.

Melita Jackson died in 2004 leaving some £486,000. She was a widow and had an only daughter, Heather Ilott, aged in her 40s, who had 5 children, a husband who only worked part-time, and who relied very largely on state support. Even a small part of her mother’s estate would have been very useful to her. But Melita left all her money to three animal charities, and cut out her daughter entirely.
As you might imagine, there was a considerable history of antagonism between mother and daughter, which started when the daughter eloped at the age of 17. Melita had not supported animal charities during her lifetime, and by all accounts didn’t like animals particularly.

The Proceedings
Heather issued proceedings against the charities under the Inheritance (Provision for Families and Dependants) Act 1975, on the grounds that the will didn’t provide “reasonable financial provision for her…maintenance” under s1 of the Act.
The District Judge allowed her £50,000 – about 10% of the estate, expressed as capitalised maintenance. This is hardly news – DJs make all sorts of decisions, and the charities were left with over £400,000, so they could live with this. However Heather wanted more and appealed to the High Court Judge. The charities cross-appealed on the grounds that no award should have been made at all, and succeeded. So off to the Court of Appeal for an authoritative decision.
This came out on 31.3.11 and the CA decided that:
• An adult child is entitled to reasonable provision for maintenance, even if they are estranged and capable of work, and comments to the contrary in the leading case of re Coventry are incorrect.
• In particular they don’t need to be owed a “moral obligation”.
• The decision is very largely one for trial judge in the case, based on a value judgement.
• The court needs to look at matters as a whole and the absence of other calls on the estate was a factor.
• The amount of the award was another matter. The parties were sent back to the High Court to decide the appeal on the amount with strong indications that they may get the DJ’s decision again.
The case is reported as Ilott v Mitson & Land [2011] EWCA Civ 346

The Comments
The charities, and some commentators, have made a lot of fuss on the basis that if all wills that exclude children can be rewritten then nobody is going to know where they are. At least in the old days this wasn’t going to happen for adult children. It is going to bring a lot of uncertainty and gold-digging. Charities will lose millions. It is hardly worth writing a will. The charities are considering a further appeal to the Supreme Court.
Others point out that there is a restriction to “maintenance” so it can only apply of the child needs to be maintained. It isn’t a free-for-all asking for a legacy in all cases. And the award is quite modest even here, and doesn’t look like it is going to be increased by much. The Act replaced earlier legislation that excluded claims by adult children unless they were disabled or unable to work, and the change was presumably meant to make a difference to the result. Spouses have always been able to able to ask for reasonable provision that is not limited to maintenance, and the sky has not fallen.

Who is right? – Guidance
This is an unusual case. If a testator wants to exclude a child from their will they ought to consider:
• Setting out reasons in the will or elsewhere – here there was an explanatory letter but it contained major inaccuracies and was not believed to be true by the DJ.
• Giving reasons for giving more to other beneficiaries: if one brother needs more because of his financial problems it may be reasonable to give the other less..
• Making a gift sufficient to cover maintenance, if not equality with others
• If they are going to give all or much or the estate to charities then at least choose charities they have a connection with.
• Considering lifetime gifts – a will, and the Act can only deal with what is left at death. But a gift made with the intention of avoiding an Inheritance claim can be set aside.
The converse applies if such a will is to be challenged. Important points are:
• Consider what is needed for reasonable financial maintenance.
• Does the claimant need an on-going subsidy for basic living expenses?
• Explore what other assets the claimant has, or might expect to get.
• Look at the evidence of reasons given by the testator very carefully.
These all require particular care from professional advisors, both in the preparation of the will, and in considering potential challenges. Falling down on either of these may give rise to a negligence claim. It requires specialist advice.