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||Neutral Citation Number:  EWCA Civ 922
||Case No: B5/2009/0715 & 0715A
IN THE HIGH COURT OF JUSTICE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM SHEFFIELD COUNTY COURT
HIS HONOUR JUDGE BULLIMORE
SE355037 & 8SE52475
||Royal Courts of Justice
Strand, London, WC2A 2LL
||30 July 2010
B e f o r e :
LORD JUSTICE WARD
LORD JUSTICE ETHERTON
LORD JUSTICE SULLIVAN
|| Sheffield City Council
||- and –
||(1) The Personal Representatives of June Wall
(2) Mr Steven Wall
(3) Mr Robert Ingham
(4) Mrs Theresa June Butler
(Transcript of the Handed Down Judgment of
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Mr Jan Luba QC and Mr Adam Fullwood (instructed by Howells LLP) for the appellant
Mr Bryan McGuire QC and Mr Tom Tyson (instructed by Sheffield City Council Legal Department) for the respondent Sheffield City Council
Mr Jonathan Karas QC and Mr Ben McCormack (instructed by Norrie Waite and Slater) for Mr and Mrs Ingham
Hearing dates: 24th and 25th March 2010
HTML VERSION OF JUDGMENT
Crown Copyright ©
Lord Justice Ward:
- The issue in this appeal is who is entitled to occupy a council house owned by Sheffield City Council. Mr Steven Wall, who was a foster son and also the personal representative of the late Mrs June Wall, who died on 21st June 2003, contends that he was and is entitled to occupy the property as her successor under the provisions of sections 87 and 113 of the Housing Act 1985. As such, he argues that the Court should grant him possession of the property as against Mr and Mrs Ingham who have resided there since April 2005 on the basis that they were also granted a secure tenancy by the Council and they contend that the Court should uphold their tenancy in their favour. The Council supported them. On 3rd March 2009 His Honour Judge Bullimore sitting at the Sheffield County Court found in favour of Mr and Mrs Ingham and made orders accordingly. Now Mr Wall brings this appeal. This is the judgment of the Court to which each member has contributed. We pay tribute to and express our gratitude for the succinct but cogent submissions urged upon us by Mr Jan Luba Q.C. for Mr Wall, Mr Jonathan Karas Q.C. for Mr and Mrs Ingham and Mr Bryan McGuire Q.C. for Sheffield City Council.
The factual background
- It is an unusual story. In 1967 Steven Wall was placed with Mrs June Wall by the Sheffield City Council as her foster-child. He was a few months old at the time. It became a long-term foster placement. Mrs Wall cared for Steven (if we may sometimes refer to him in this familiar way) as her child and brought him up as her child, treating him as she treated her own older children as members of one family. Steven and Mrs Wall had a very close and loving relationship as mother and child. Steven always considered himself to be her child for he looked to her for love, care and support and in return treated her as his mother. This relationship endured until her death after a long illness during which Steven was her primary carer. For whatever reason Steven was never formally adopted but, as Mr Luba graphically submits, Steven knew no other mother or to put it another way, he was nobody else's child.
- On 6th October 1986 Mrs Wall was granted a secure tenancy of 18 Oldfield Terrace in Sheffield on the express basis that the occupants of this two-bedroomed house would be herself and her "son", Steven.
- Meanwhile in 1985, when he was aged 19, Steven had embarked on an undergraduate study of law at Hull University, whence he successfully graduated in 1988. Following his graduation, Steven again took up residence with Mrs Wall. He was away between 1996 and 1999 studying for a B.A. degree in Insurance at the London Metropolitan University but although away during term time, his home was with his "mother" in Sheffield.
- In September 1999 he won a two year training contract with DLA, solicitors in Sheffield. As part of that training he was transferred to the London office on 1st September 2001 on a six month contract. Because of his work in London he entered into a tenancy agreement to rent a flat in Brentwood, Essex. In November 2001 he was admitted as a solicitor. His work in London ended on 28th June 2002 and he moved back with all his belongings to live at the property with Mrs Wall.
- Sadly Mrs Wall was diagnosed to be suffering from cancer and her condition inexorably worsened. Steven devoted himself to caring for her. He was her primary carer throughout this illness. On 21st June 2003 she died. Steven had been back home a week short of 12 months.
- On 29th October 2003 a notice to quit was served on him and the Public Trustee and on 29th December 2003 the Council issued a claim for possession of the property out of the Sheffield County Court on the ground that there was no person qualified to succeed to the tenancy and that a valid notice had been served. Steven contended that he was entitled to the tenancy and had in fact succeeded to it and that the notice to quit could not in those circumstances validly have terminated that tenancy.
- On 15th December 2004 the claim for possession came before Mr Recorder Ake who found that the Council was estopped from denying that Mr Wall was a member of Mrs Wall's family for the purposes of section 113 of the Housing Act 1985 but that he had not resided in the property for the 12 months prior to her death. He therefore ordered that possession be given up on or before 12th January 2005.
- Mr Wall appealed but, despite appealing, he did not seek a stay of execution of the order and in fact vacated the premises as he was ordered to do. On 15th February 2005 the order for possession was formally executed and on 4th April 2005 the property was re-let to Mr and Mrs Ingham under the terms of a secure tenancy agreement. They have lived there ever since.
- On 23rd March 2006 the Court of Appeal set aside the order for possession and remitted the matter to the County Court for re-hearing, urging all parties to explore the possibilities of compromise.
- No settlement has proved possible. Mr Wall applied to have the matter restored and the Council then changed its position and informed him that it no longer disputed his assertion that he satisfied the residence requirement for succession. Mr Wall then applied to join Mr and Mrs Ingham and issued his own claim for possession against them.
- Those issues came before His Honour Judge Bullimore on 30th September 2008 and on 3rd March 2009 he dismissed the Council's claim against Mr Wall for possession, but likewise dismissed Mr Wall's claim for possession as against Mr and Mrs Ingham. He made no order for costs as between the Council and Mr Wall, save for the public funding assessment of Mr Wall's costs. He ordered Mr Wall to pay Mr and Mrs Ingham's costs but adjourned the assessment of those costs and directed that the order should not be enforced without leave of the Court, Mr Wall being legally aided. He dismissed Mr and Mrs Ingham's claim that the Council pay their costs.
The legislative background
- Section 79 of the Housing Act 1985 ("the 1985 Act") defines a secure tenancy as a tenancy under which a dwelling house is let as a separate dwelling when the "landlord condition" and the "tenant condition" are satisfied. Section 80 provides that the landlord condition is satisfied when the interest of the landlord belongs to a Local Authority, as here. Section 81 provides that the tenant condition is satisfied when a tenant is an individual and occupies the dwelling house as his only or principal home.
- A secure tenancy cannot be brought to an end by the landlord save by the landlord obtaining an order of the Court for possession of the dwelling house and the execution of that order: see section 82(1) and (1A). The Court will not entertain proceedings for possession unless the landlord has served a notice on the tenant complying with the provisions of section 83 of the Act. No order for possession may be made save on one or more of the grounds identified in Schedule 2 to the Act. There is power to stay or suspend execution of the order or postpone the date of possession as the Court thinks fit.
- Section 87 lies at the heart of this appeal:
"87 Persons qualified to succeed secure tenant
A person is qualified to succeed the tenant under a secure tenancy if he occupies the dwelling-house as his only or principal home at the time of the tenant's death and either —
(a) he is the tenant's spouse or civil partner, or
(b) he is another member of the tenant's family and has resided with the tenant throughout the period of twelve months ending with the tenant's death;
unless, in either case, the tenant was himself a successor, as defined in section 88."
- Section 89(2) was also raised in argument:
"(2) Where there is a person qualified to succeed the tenant, the tenancy vests by virtue of this section in that person ….
(3) Where there is no person qualified to succeed the tenant, the tenancy ceases to be a secure tenancy …"
- Section 113 is also vital. It provides:
"113. Members of a person's family
(1) A person is a member of another's family within the meaning of this Part if—
(a) he is the spouse or civil partner of that person, or he and that person live together as husband and wife or as if they were civil partners, or
(b) he is that person's parent, grandparent, child, grandchild, brother, sister, uncle, aunt, nephew or niece.
(2) For the purpose of subsection (1)(b)—
(a) a relationship by marriage or civil partnership shall be treated as a relationship by blood,
(b) a relationship of the half-blood shall be treated as a relationship of the whole blood,
(c) the stepchild of a person shall be treated as his child, and
(d) an illegitimate child shall be treated as the legitimate child of his mother and reputed father."
- We are also concerned with the European Convention on Human Rights. As is now well known Article 8 of the ECHR provides that:
"(1) Everyone has the right to respect for his private and family life, his home and his correspondence.
(2) There shall be no interference by public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection or health or morals, or for the protection of the rights and freedoms of others."
Article 14 states that:
"The enjoyment of the rights and freedoms set forth in this Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status."
- Section 3 of the Human Rights Act 1998 states:
"(1) So far as it is possible to do so, primary legislation and subordinate legislation must be read and given effect in a way which is compatible with the Convention rights. …"
The first ground of appeal: was Mr Wall qualified to succeed to the tenancy on the ground that he fell within the meaning of "another member of the tenant's family" for the purposes of sections 87 and 113 of the Housing Act 1985 read together with ECHR Articles 8 and 14?
- If the question depends only on the construction of section 87 then it admits of a clear answer. Mr Wall as the tenant's de facto adopted son was undoubtedly a member of her family. The reasoning that applied in Brock v Wollams  2 K.B. 388 would apply here. As Lord Denning said at p. 396:
"It seems to me that "members of the tenant's family" within s. 12, sub-s. 1 (g) of the Act of 1920, include not only legitimate children but also step-children, illegitimate children and adopted children, whether adopted in due form of law or not."
- This extended meaning given to the expression "member of the tenant's family" was exemplified by Fitzpatrick v Sterling Housing Association Ltd  1 AC 27 where the surviving partner in a stable and permanent homosexual relationship was accepted as a member of the deceased tenant's family within the meaning of paragraph 2(2) of Schedule 1 to the Rent Act 1977. Lord Slynn of Hadley said at p. 38:
"Given, on the basis of these earlier decisions that the word is to be applied flexibly, and does not cover only legally binding relationships, it is necessary to ask what are its characteristics in this legislation and to answer that question to ask further what was Parliament's purpose. …
The hall marks of the relationship were essentially that there should be a degree of mutual inter-dependence, of the sharing of lives, of caring and love, of commitment and support. In respect of legal relationships these are presumed, though evidently are not always present as the family law and criminal courts know only too well. In de facto relationships these are capable, if proved, of creating membership of the tenant's family. If, as I consider, this was the purpose of the legislation, the question is then who in 1994 or today (I draw no distinction between them) are capable in law of being members of the tenant's family."
- Lord Slynn was, however, careful to say at p. 34:
"In other statutes, in other contexts, the words may have a wider or a narrower meaning than here."
More pertinently he pointed out at p. 32:
"There are differences between this legislation and the Housing Acts dealing with public sector housing …
The language chosen for this purpose was the undefined expression "family". This expression is not a term of art; that is, it is not a technical term with a specific meaning. It is a word in ordinary usage, with a flexible meaning. The statutory succession provisions have been amended several times, but to this day "family" has remained unamended, undefined and unparticularised. Parliament has left it to the courts to determine in any given case whether a particular individual falls within the description … (We have added the emphasis.)
Family is a word with several different meanings. … The present context is statutory protection of the occupancy of a dwelling house that is a family home. On the death of the tenant his family cannot be evicted without further ado.
Herein lies the key to the meaning of family in this context. The key is the statutory juxtaposition of membership of the tenant's family and residence with the tenant. The legislation seeks to provide a measure of protection for members of the family who are sharing their lives together as a single family in one home."
- Lord Nicholls of Birkenhead sounded a similar warning at p.41, with the emphasis added by us:
"The language chosen for this purpose was the undefined expression "family". This expression is not a term of art; that is, it is not a technical term with a specific meaning. The statutory succession provisions have been amended several times but to this day family has remained unamended, undefined and unparticularised. Parliament has left it to the courts to determine, in any given case, whether a particular individual falls within the description."
- Lord Nicholls went on to say at p.41:
" Family is a word with several different meanings. … The present context is statutory protection of a dwelling house that is a family home. On the death of the tenant his family cannot be evicted without further ado.
Herein lies the key to the meaning of family in this context. The key is the statutory juxtaposition of membership of the tenant's family and residence with the tenant. The legislation seeks to provide a measure of protection for members of a family who are sharing their lives together as a single family in one home"
- These speeches force us to examine the purpose of the legislation and the context. The purpose of the Housing Act is essentially no different from the purpose of the Rent Act. That is certainly wide enough to embrace Mr Wall but the context remains important.
- That context is supplied in the Housing Act by section 113. Unlike the Rent Act cases analysed in Fitzpatrick, the Housing Act does define members of a person's family. A person is a member of another's family if he is that person's child which is an obvious inclusion. But section 113(2) goes further and narrows the meaning of the words in section 113(1)(b). There is a heavy emphasis on the blood relationship. Significantly the meaning of "child" is expanded to include a step child and illegitimate child. What it does not do is include foster child.
- In our judgment the words "a person is a member of another's family within the meaning of this Part if …" are to be construed to mean that he is only a member of the family if he can bring himself within its ambit. Thus "child" must be limited to the closed categories stipulated in section 113(2), namely blood relationships, step children and illegitimate children. When Parliament wished to extend the meaning to cover de facto relationships, it did so expressly, for example, by defining "spouse or civil partner" to include those who live together as husband and wife or as if they were civil partners. Absent such amplification there is in our judgment no room for extending the meaning of a "child" to cover a foster child. This definition of the terms distinguishes the Housing Act cases from the Rent Act cases and the flexibility afforded by Fitzpatrick does not apply in this case.
- Wandsworth London Borough Council v Michalak  EWCA Civ 271,  1 WLR 617 supports that conclusion. There an attempt was made to succeed to a secure tenancy not on the ground that Mr Michalak was a child but on the ground that he was a member of the tenant's family. There was no blood relationship: the tenant was the brother-in-law of the defendant's first cousin once removed. The defendant used to address the tenant by a Polish word which might be translated "uncle" which the judge took to be an affectionate form of address by a younger member of a family to an older member of the family who was distantly related to him. Brooke L.J. held:
"12. … In my judgment the editors of the Housing Law Reports were correct when in their introductory note to Harrogate Borough Council v Simpson they wrote at p. 205, in relation to s 50(3) of the Housing Act 1980:
"In defining the term ['member of family'] statutorily, Parliament clearly sought to distance itself from the case law which had grown up around the term under the Rent Acts: see now Rent Act 1977 section 2 and Sch 1, Part I. In that Act, the same term 'member of family' is used, but not defined, and reliance is placed on earlier judicial definitions."
14. It is clear to me that in abandoning the potentially open-ended phrase "member of the tenant's family" by inserting the explanatory section 113 which shows what type of relative is embraced by that phrase, Parliament intended to achieve certainty, a quality which is very desirable in the arena of local authority housing with which these statutory provisions are concerned. Although, as Mr Luba argued, a rigid list may lead to unfairnesses at the edges, its introduction leads to clarity and the avoidance of costly and time-consuming litigation as to who is and who is not a member of the tenant's family for this purpose. Section 113 makes the position clear."
The fact that that case concerned identification of 'members of the family' whereas our case concerns the meaning of "child" is in our judgment a distinction without a difference.
- We have great sympathy for Mr Wall who was to all intents and purposes Mrs Wall's son but he was short of that vital piece of paper – the adoption order – and without it he falls outside the definition of "child" in section 113 unless that has to be read and given effect in a way which is compatible with his Convention rights.
- There is no doubt that Mr Wall's Article 8 rights were engaged. We are prepared to accept for the purposes of the argument that the enjoyment of those rights is discriminated against on the ground of his birth or status as a foster child but the crucial question is whether such difference in treatment had an objective and reasonable justification.
- In Michalak the Court found that there was justification. Brooke L.J. held:
"41. It appears to me that this is pre-eminently a field in which the courts should defer to the decisions taken by a democratically elected Parliament, which has determined the manner in which public resources should be allocated for local authority housing on preferential terms. Parliament decided to continue to adopt the Rent Act concept of "a member of the tenant's family" when identifying who might succeed to a secure tenancy, but to introduce a measure of legal certainty, a concept prized by Strasbourg, when explaining with precision the type of close relative who should be entitled to be the first (and only) successor to a secure tenancy. It is understandable why Parliament wished a home not to be broken up on the death of a secure tenant when his wife or other very close relative was living with him as a member of his family at that time. It is equally understandable why Parliament decided that this privilege should not be extended to a more distant relative like Mr Michalak who was living at the secure tenant's home at the time of his death."
Mance L.J. said:
"63. … The reality is that Parliament has, in the provisions of sections 87 and 113, considered and determined the extent to which those residing with a secure tenant should be entitled to succeed to the benefits of a secure tenancy. Outside the categories of spouse and member of the tenant's family, as defined, others residing were not to succeed to any secure tenancy, and Parliament necessarily contemplated that the dwelling-house would become available once again to the relevant local authority for use in the ordinary way, as it should determine."
- Mr Luba does not dispute that certainty could be a justification but he asked rhetorically whether the administrative convenience of certainty is proportionate to the discrimination suffered. He observes that there are uncertainties inherent in sections 87 and 113, such as the issue of whether the person claiming to be the successor resided with the tenant throughout the period of twelve months ending with the tenant's death and he points with justification to round one of the present battle where this Court reversed the Recorder's findings in that respect: see the judgment of 23rd March 2006,  EWCA Civ 495. Deciding whether persons who are living together as husband and wife or as if they were civil partners throws up its own problems: see for example Fitzpatrick. The uncertainties involved in deciding whether a foster child has such a close loving and long-standing relationship as to be treated as if he were an adopted child is but another example of the landlord (and perhaps later a court) having to undertake a difficult factual enquiry. We see the force of those submissions but the fact remains that council housing is a precious and limited resource, the management of which is vested in and is to be exercised by the local housing authority by virtue of section 21(1) of the 1985 Act. It is for the authority concerned to decide who is to be qualified to be allocated housing accommodation by it and the allocation schemes determine the priorities and procedures to be followed in allocating housing accommodation.
- We therefore agree with Moses J., as he then was, in R. (On the application of Gangera) v Hounslow London Borough Council  EWHC 794 (Admin),  HLR 68 who said this at :
"It is plain that Parliament had to strike a balance between security of tenure and the wider need for systematic allocation of the local authority's housing resources in circumstances where those housing resources are not unlimited. The striking of such a balance is pre-eminently a matter of policy for the legislature. The court should respect the legislative judgment as to what is in the general interest unless that judgment was manifestly without reasonable foundation."
In our judgment the exclusion of foster children is objectively justified. It follows that the legislation is compatible with Mr Wall's Convention rights and there is, in those circumstances, no need to extend the ordinary and natural meaning of the words of the statute. Most unfortunately for this particular foster child, he does not qualify for succession to the tenancy and we reject the first ground of his appeal.
The other grounds of appeal
- Our decision on the first ground of appeal makes it unnecessary to decide the remaining grounds of appeal. As amended, with our permission, those other grounds are as follow.
" The learned judge erred in law in failing to hold that a secure tenancy vests at the moment of death in the person entitled to succeed to the tenancy and that the deceased's tenancy in the instant case vested in Mr Wall on the deceased's death if he qualified as a successor.
 The learned judge erred in concluding that the effect of the order for possession made by Recorder Ake was to determine the secure tenancy that arose by virtue of his [Mr Wall's] succession following the death of Mrs Wall.
 Had he properly directed himself, the learned judge ought to have held that by virtue of his superior title, viz the undetermined secure tenancy which vested in him on his mother's death, Mr Wall was entitled to possession as against the present occupiers."
- Those grounds address the legal complications arising in a situation in which an authority, which has let property on a secure tenancy, believes that the occupier has not succeeded to the tenancy, obtains vacant possession of the property following a possession order against the occupier, and then purports to re-let the property on a new secure tenancy to another person, but the possession order is subsequently set aside on appeal. There are various possible factual variations of those circumstances, which raise the same legal complications, most obviously where an authority considers that it is entitled to terminate a secure tenancy on one of the statutory grounds, obtains an order for possession against the tenant, and then purports to re-let the property on a new secure tenancy, but the possession order is subsequently set aside. We heard argument and received written submissions both before and after the oral hearing on the legal consequences of such circumstances, and consider that it would be helpful to highlight briefly the legal difficulties that arise, not only to assist if there should be a further appeal but also as a warning of the need for particular care in circumstances where a possession order against a person claiming to be and to remain a secure tenant is being challenged by an appeal or a proposed appeal. We shall not comment on all the detailed arguments of counsel, but only recount sufficient to provide a fair analysis.
- There is no legal difficulty or dispute so far as concerns the second ground of appeal. All parties before us were agreed that, if Mr Wall was Mrs Wall's "child" within section 113(1)(b) of the 1985 Act, there was an automatic statutory vesting of Mrs Wall's secure tenancy in Mr Wall on her death. That was the effect of section 89(2)(b) of the 1985 Act, bearing in mind that it was not disputed that, at that time, Mr Wall satisfied the residence requirements of section 87 of the 1985 Act, and the landlord condition and the tenant condition in sections 80 and 81 respectively of the 1985 Act were also satisfied. Insofar as Judge Bullimore found otherwise, his decision on that point was not correct.
- The effect of the possession order, the re-letting of the Property, and the subsequent setting aside of the possession order on appeal, give rise to difficult legal issues.
- The Council and Mrs and Mrs Ingham say the position is clear: the possession order terminated Mr Wall's secure tenancy. They rely on the decision of this Court in Brent LBC v Botu  33 HLR 14. The facts of that case were that Brent granted a secure tenancy to the defendant. While the defendant was remanded in custody Brent obtained, in his absence, a possession order against him on the ground of rent arrears. On his release from prison on bail, the defendant discovered that the order had been made. Before his application to set aside the possession order was heard, Brent secured execution of a warrant for possession and re-let the premises to a Mr Ahmed. The judge then set aside the possession order, but refused an application for an order for reinstatement of the defendant in the premises. Brent provided the defendant with a tenancy of another property. The defendant claimed damages against Brent for breach of covenant for quiet enjoyment from the date the order for possession was made until the grant of his new tenancy. He also claimed against Mr Ahmed in trespass, but he later decided not to proceed with that claim. The judge held that Brent had breached the covenant for quiet enjoyment from the time when the possession order was set aside until the provision of alternative accommodation, but rejected the claim in respect of the period prior to the setting aside of the possession order. Brent appealed to the Court of Appeal and the defendant cross-appealed against the finding there was no breach of covenant during the earlier period. Judge LJ (as he then was) gave the leading judgment, with which the other two judges agreed.
- Counsel for the defendant and (doubtless for that reason) Judge LJ apparently proceeded on the assumption that, but for the order setting aside the possession order, the defendant's secure tenancy would have been finally determined by the possession order. This appears from the following two passages in Judge LJ's judgment:
"13… In summary, the question for decision before Hornby J., and before us, is whether the setting-aside order had the effect of resuscitating the secure tenancy which the original possession order, and subsequent execution by eviction, had apparently brought to an end."
"16… As Mr Short accepted, without a successful appeal against the order, or a stay pending appeal, or an order to set it aside, the plaintiff's secure tenancy had been brought to an end and the order for possession enforced by his eviction. The setting aside order, and its effects, provided the significant features of his argument."
- Judge LJ first attacked the logic of the defendant's contention that the secure tenancy was "resuscitated" when the possession order was set aside. He said:
"18… the logical conclusion of Mr Short's argument would be that these premises were the subject of two secure tenancies under the 1985 Act, each simultaneously providing identical, but mutually contradictory rights between two separate individuals. This would be a nonsense. The effect of the statutory provisions governing Mr Ahmed's tenancy is such that the priorities between the conflicting claims cannot be determined simply by asking which of the tenancies came first, and jumping to the conclusion that the second tenancy must have taken effect subject to the plaintiff's, at best, dormant entitlement to revive his tenancy by a successful application to set aside the original order, or a successful appeal. The decision not to proceed with the claim for trespass against Mr Ahmed was right. He enjoyed an immediate right to possession of the premises. He also enjoyed the benefit of the covenant of quiet enjoyment. Despite Mr Short's argument, I cannot envisage the basis on which Brent could possibly owe an obligation to the plaintiff concurrently to abide by the same covenant of quiet enjoyment in respect of the same premises."
- Judge LJ then turned to authority. He first referred to Hillgate House Limited v Expert Clothing Service & Sales Ltd  1 EGLR 65. In that case the landlord obtained an order for possession on the ground that the tenant's lease was forfeited. The landlord went into possession pursuant to the order. The order was subsequently reversed by the Court of Appeal, and, in a second action, the tenant, Hillgate House Ltd, claimed damages arising from the taking of possession by the landlord during the period between the judgment at first instance and the judgment of the Court of Appeal. The following preliminary issue was ordered:
"Can an action for trespass, and/or breach of covenant for quiet enjoyment, and/or derogation from grant, be maintained by a tenant against his landlord who has entered on to demised premises and excluded the tenant therefrom following the making of an order for possession in forfeiture proceedings by a High Court judge whose decision is subsequently reversed by the Court of Appeal?"
- Sir Nicholas Browne-Wilkinson V-C answered that question in the negative. Judge LJ quoted the following from the judgment of the Vice-Chancellor:
"Once the Court of Appeal had spoken, the true position which had existed throughout was disclosed ... On analysis what the plaintiffs are claiming in this case is that the acts done by them, the tenants, and by the landlords, directly pursuant to the order of the trial judge, themselves constitute a breach of legal duty which gives rise for the first time to a cause of action. In my judgment, that cannot be right. ... When an order is in force, and so long as it is in force, it is to be obeyed and is in law correct. It is true that it may be all subsequently altered on appeal; but unless and until it is altered, it is an order of the court and acts done under it are lawful."
"Since the landlords were acting under an order of the court, any interruption was lawful at the time it took place and cannot retrospectively be made unlawful."
- Judge LJ said that Hillgate was indistinguishable. He then said that his conclusion was further reinforced by the decision in Isaacs v Robertson  AC 97, itself referred to and relied on by the Vice-Chancellor in Hillgate. Judge LJ said:
" The principle described by Lord Diplock as "short and well established" is that an order "made by a court of unlimited jurisdiction ... must be obeyed unless and until it has been set aside by the court". Later, when he recorded the distinction between orders set aside on application to the court which made them and those set aside by an appellate court, he did not suggest that these distinctions had any relevant bearing or imposed any gloss on the principle. This is entirely consistent with the familiar field of interlocutory injunctions granted ex parte. An injunction may be discharged by an application to the court which made the original order. If that court decides that the injunction should not be discharged then, if necessary, the issue is resolved in the Court of Appeal. The order must be obeyed unless and until it is discharged."
- Judge LJ added:
" … Where, as here, the interests of a third party become involved, emphasis is added to what the Vice Chancellor identified as "the risk of very great confusion. People must be entitled to act in pursuance of a court order without being at risk that they are thereby acting unlawfully. Public policy requires it"."
- In relation to Mr Ahmed's tenancy, Judge LJ said:
"… Certainly Mr Ahmed's tenancy, lawful at its outset, was not rendered "null and void" by the setting aside order, and to my mind, while he enjoyed the rights of the tenant at the premises, including the benefit of the covenant of quiet enjoyment, the plaintiff did not."
- The assumption underlying the analysis of Judge LJ, and therefore his starting point - that, subject to the effect of the setting aside of the possession order, its effect was to terminate the defendant's tenancy – is difficult to reconcile with conventional principles of property law. The same is true of his further apparent conclusion that, where there is a secure tenancy, there can never be another tenancy in respect of the same premises.
- A secure tenancy is a contractual tenancy, in the present case a periodic tenancy, which has the benefit of statutory security of tenure if the conditions in the 1985 Act are satisfied. In the graphic words of Mr Luba, it is a contractual tenancy "cloaked" with statutory protection. This is clearly articulated in the speech of Lord Hoffmann in Birmingham City Council v Walker  UKHL 22,  2 AC 262, with which the other members of the Judicial Committee agreed. He analysed the history and nature of a secure tenancy, by reference to the predecessor provisions to Part IV of the 1985 Act contained in the Housing Act 1980, and contrasted a secure tenancy with a Rent Act statutory tenancy. He said:
" The secure tenancy, like the statutory tenancy in the private sector, can be terminated only by an order of a county court made on one of a list of specified grounds. But the technique by which secure tenancies are integrated into the ordinary law of landlord and tenant is very different from that which was used in the Rent Acts more than 60 years earlier. The old legislation had left untouched the landlord's right to determine a contractual tenancy by notice or otherwise in accordance with its terms and the general law. It provided that, on such termination, the tenant acquired a new interest which is now called a statutory tenancy. The 1980 Act, on the other hand, preserved the contractual tenancy. It merely added statutory incidents to that tenancy which overrode some of the contractual terms. These overriding provisions include the provisions which prevent it from being terminated except by an order of the court on the statutory grounds."
" The method adopted by the 1980 Act to deal with transmissions is different. It reflects the fact that a secure tenancy is different in nature from a statutory tenancy. Whereas the statutory tenancy is unassignable, not an estate in land but a mere "personal right of occupation" (see Lord Greene MR in Carter v SU Carburetter Co  2 KB 288, 291), a secure tenancy is an orthodox estate in land which, subject to specific restrictions in the 1980 Act, can be assigned, held in joint names, pass by survivorship and be disposed of by will on death. Thus, while a statutory tenancy can pass from one person to another only in very limited circumstances (such as the statutory transmission on death or by a court order on divorce) a secure tenancy can in principle pass in any way permissible at common law. "
- The contractual aspect of a secure tenancy, which creates an estate in land, as distinct from its "cloak" of statutory protection, was also recognised by Arden LJ in the following statement in Austin v Southwark LBC  EWCA Civ 66,  25 EG 138:
" … There is no need for a successor to make an application under s 89. Any vesting is automatic. Where there is no successor, the tenancy does not automatically cease to be a secure tenancy at the death of the tenant. If there is no person who is qualified to succeed to the tenancy, it does not cease to be secure until that time specified in s 89(3) arrives. When it ceases to be a secure tenancy, it becomes a contractual tenancy only."
- Notwithstanding the forceful submissions of Mr McGuire to the contrary, Hillgate is no authority for the proposition that an improperly granted possession order, let alone one which was not made pursuant to one of the specified statutory grounds, of itself terminates a secure tenancy. In Hillgate the effect of the decision of the Court of Appeal, reversing the order for possession, was to recognise that the allegedly forfeited lease had never been forfeited, and the question was whether, that being so, the landlord could be sued for trespass and for breach of the covenant for quiet enjoyment in respect of the period between the making of the order for possession and the decision of the Court of Appeal. It was in that particular context that the Vice-Chancellor held that (1) no action for trespass would lie since the order for possession, until set aside, gave lawful possession to the landlord, and (2) there could be no action on the covenant for quiet enjoyment since the covenant only extended to unlawful interruption by the landlord and, until the possession order was set aside, the landlord's interruption was lawful.
- For those reasons, any rule of law that an order for possession, even if made without a proper lawful basis and even if not made after service of the statutory notice and on one of the statutory grounds for possession (see the 1985 Act ss.83 and 86), automatically and irrevocably terminates the secure tenancy, or at any event the contractual rights and property interest comprised in that tenancy, must be found by some implication in the 1985 Act itself. Such an implication is far from clear, and was not the subject of any analysis in Botu.
- If the order for possession did not automatically terminate Mr Wall's secure tenancy, the next question that arises concerns the effect of the purported grant of a secure tenancy to Mr Ingham, and then to Mr and Mrs Ingham jointly. Mr Luba accepts that, as between the Council and Mr and Mrs Ingham, the latter have the benefit of a secure tenancy by estoppel (see Epping Forest District Council v Pomphrett (1990) 22 HLR 475), but he submits that it had no effect whatsoever on Mr. Wall's secure tenancy. His case is that, so far as concerns Mr Wall's tenancy, the landlord condition in section 80 of the 1985 Act, and more particularly the tenant condition in section 81 of the 1985 Act, continued to be satisfied. Mr Luba contends that, although neither Mr Wall nor any of his possessions have been physically present on the Property since Mr and Mrs Ingham went into occupation, Mr Wall is to be treated as being in occupation because Mr Wall always intended to have possession and resume occupation of the Property, and that intention was always apparent from his appeal against the order for possession and then his claim for possession against Mr and Mrs Ingham. Mr Luba relied upon the principles which Etherton J articulated in Amoah v London Borough of Barking and Dagenham (2001) 82 P&CR DG 6.
- In that case Mr Amoah was granted a secure tenancy of a flat. He was sentenced to 12 years imprisonment for criminal offences. The council served notice to quit on Mr Amoah, and then instituted proceedings for possession on the ground that he had ceased to occupy the property as his only or principal home within section 81 of the 1985 Act. An order for possession was made. Etherton J allowed the appeal and set aside the possession order. Having reviewed a number of reported cases, including Brown v Draper  KB 309, Brown v Brash  2 KB 247, Gofor Investments Ltd v Roberts  20 RP&C 366, Brickfield Properties v Hughes  20 HLR 108, Notting Hill Housing Trust v Etoria  CLY 1912, Beggs v Kilmarnock and Loudoun District Council  SC 333, and Ujima Housing Association v Ansah  30 HLR 831, Etherton J summarised, as follows, the propositions established in those cases, adapting the wording and approach used by Asquith LJ in Brown v Brash:
"A. Absence by the tenant may be sufficiently prolonged or unintermittent to compel the inference, prima facie, of a cesser of possession or occupation. The question is one of fact and degree.
B. Assuming an absence sufficiently prolonged to have this effect:
1. The onus is on the tenant to repel the presumption that his possession has ceased.
2. In order to repel it he must at all events establish a de facto intention on his part to return after his absence.
3. While there is no set limit to the length of absence, the tenant must be able to demonstrate a 'practical possibility' or 'a real possibility' of the fulfilment of his intention to return within a reasonable time.
4. The tenant must also show that his inward intention is accompanied by some formal, outward and visible sign of this intention to return, which sign must be sufficiently substantial and permanent that in all the circumstances it is adequate to rebut the presumption that the tenant, by being physically absent from the premises for a prolonged period, has ceased to be in possession of it."
- Etherton J allowed the appeal on the ground that there was no evidence upon which the county court judge could reasonably rely as contradicting Mr Amoah's subjective intention to return. The property was the only home of Mr Amoah, and he had no other place to which to return. As to whether there was some formal, outward or visible sign of Mr Amoah's inward intention to return, sufficiently substantial and permanent to be adequate to rebut the presumption that, being physically absent from the property for a long time, he had ceased to be in possession of it: his furniture was there, a lady had been specifically designated by the council to caretake the property in his absence, and had been entrusted with keys to the property for that purpose, and she paid the rent.
- The facts of Amoah itself, like the facts of the cases cited in Etherton J's judgment and from which he drew the principles which he applied in Amoah, bear no relationship to those of the present case. In those cases, there were present on the premises possessions of the tenant or persons connected with him, which reflected the tenant's continuing presence despite his personal physical absence. In the present case, by contrast, Mr and Mrs Ingham have had and continue to have exclusive legal possession of the Property and sole physical occupation of it, to the exclusion of Mr Wall, and none of Mr Wall's possessions have remained on the premises since Mr and Mrs Ingham took up occupation. It is not legitimate to apply the principles derived by Etherton J from cases concerned with quite different factual scenarios, and which he applied in a factual scenario similar to those cases, to the entirely different factual setting of the present case. Without having to decide the point, we are therefore very doubtful whether Mr Wall would have continued to satisfy the tenant condition in section 81 of the 1985 Act after the grant of the tenancy to Mr Ingham.
- That still leaves, however, the issue of the inter-relationship between Mr Wall's continuing contractual, but statutorily unprotected, tenancy (assuming the Botu point in his favour) and Mr and Mrs Ingham's subsequently granted secure tenancy. On conventional principles of property law, when the grant of a tenancy is followed by the grant of another tenancy of the same property for all or part of the same term, the second tenancy is a concurrent or overriding tenancy and, for the duration of the concurrent term, an assignment of the landlord's reversion: see the following statement in para. 6.018 of Woodfall on Landlord and Tenant:
"6.018 Nature of Concurrent Leases
A concurrent or overriding lease is one granted subject to and with the benefit of a lease which is already in existence. The term of the concurrent lease begins before the expiration or other determination of the existing lease. Such a lease is said to take effect in reversion expectant upon the earlier term, which may be either shorter or longer than the concurrent term. Although the overriding lease does not carry with it the right to immediate physical possession of the property comprised in the lease, it does confer on the lessee the immediate right to the rents and profits of the land as from the beginning of the concurrent or overriding term. As from that date the concurrent term operates as an assignment of the reversion during such time as the two terms run concurrently.
Any number of concurrent terms may take effect as legal estates; for "term of years absolute" includes a term of years subject to another legal estate."
- There is a complication, however, as regards the necessary formalities for a concurrent lease. Since a concurrent lease is an assignment of the reversion for the duration of the concurrent term, the normal rule is that it must comply with the formalities for the assignment of reversions, and so will be void unless made by deed: Woodfall para. 6.019; Foa's General Law of Landlord and Tenant (8th ed) para. 28; Hill and Redman's Law of Landlord and Tenant paras. A and A. There is, however, a well arguable case that a concurrent lease for a term not exceeding three years to commence immediately at a full market rent can be granted without a deed. That is because section 54 of the Law of Property Act 1925 provides that a lease taking effect in possession for a term not exceeding three years (whether or not the lessee is given power to extend the term) at the best rent which can be reasonably obtained without taking a fine may be created by parol. That is expressed to be the better view by the editors of Woodfall at para. 6.019. It was the view urged upon us by Mr Karas. It should be noted that "possession" for this purpose does not mean actual occupation but rather legal possession, which includes the right to receive rent from the occupying tenant: Law of Property Act 1925 section 205(1) (xix). Mr Luba relies upon the judgment of James Munby QC (now Munby LJ) in Long v Tower Hamlets LBC  Ch 197 as authority to the contrary. That case, however, is not in point since it was concerned, not with the grant of a concurrent lease, but the grant or an agreement to grant a tenancy in the future.
- Mr Luba also relies on section 48 of the Landlord and Tenant Act 1987, which requires the landlord of premises to which that section applies, to provide the tenant with an address at which notices may be served, and provides that, if he fails to do so, any rent otherwise due from the tenant shall be treated for all purposes as not being due from the tenant to the landlord. Mr Luba says that no such notice has been served. We are doubtful whether those provisions preclude legal possession for the purposes of section 54(2) of the Law of Property Act 1925, but the point has not been the subject of oral submissions to us.
- At this point of the analysis - assuming that Mr Wall has a statutorily unprotected periodic tenancy originally granted by the Council, but now held under the concurrent lease granted to Mr and Mrs Ingham, so that they are the assignees of the reversion on Mr Wall's tenancy and his immediate landlords - on conventional property principles Mr Wall would be entitled to possession but his tenancy would be terminable by notice to quit served by Mr and Mrs Ingham. That it is their right to serve a notice to quit, rather than the Council, does not, however, appear to be consistent with Osei-Bonsu v Wandsworth LBC  1 WLR 1011.
- The facts of Osei-Bonsu were that the local authority granted the plaintiff and his wife a secure joint tenancy of a council house. The wife moved into bed and breakfast accommodation, complaining of the plaintiff's violence towards her. She secured an ouster injunction requiring the plaintiff to leave the property. He did so, but refused to surrender the tenancy. The wife then served a notice to quit on the local authority, but it was less than the 28 days required under the tenancy agreement and under the Protection from Eviction Act 1977. The local authority, however, treated the notice as valid and accepted it. The local authority then granted the wife a new tenancy of other premises. Shortly after the notice expired, the local authority formally repossessed the property. The ouster order was then discharged by consent. The plaintiff was refused readmission to the property, which the local authority then let to a Ms Jackson. The plaintiff commenced proceedings for a declaration that he remained a joint tenant of the property. The proceedings were dismissed, but the plaintiff successfully appealed to the Court of Appeal, as a result of which it became clear that tenancy had not been validly determined. The local authority then caused the wife to serve on it a second notice to quit giving the full 28 days required. Ms Jackson's tenancy ended, and the property was again relet. The plaintiff then brought proceedings for damages for trespass and for statutory damages. He obtained an order for damages and a declaration that he remained a tenant of the property. The local authority appealed. In the Court of Appeal Simon Brown LJ (as he then was) gave the leading judgment, with which the other members of the Court agreed.
- In the Court of Appeal argument over whether or not the plaintiff remained a tenant of the property turned on the validity and effect of the second notice to quit served on the local authority by the wife. It was contended for the plaintiff that the notice was ineffective because it had been wrongly served on the local authority when it should have been served on Ms Jackson to whom the local authority had let the property, and in whom, therefore, the local authority's reversion had become vested. Counsel for the local authority argued that the notice to quit was validly served on the local authority because the tenancy granted to Ms Jackson was void. He did not argue it was void because it was not granted by deed, a point that does not appear to have been argued at all, but on the ground that the subject matter of the contract was essentially and radically different from the subject matter which the parties believed to exist. It appears that both counsel were proceeding on the assumption that the grant of the tenancy to Ms Jackson operated as the grant of a concurrent or overriding lease (which Simon Brown LJ, presumably reflecting the submissions of counsel, mistakenly called the grant of a reversionary (i.e. future) estate (see Woodfall at paras. 6.024 and 6.025)). Simon Brown LJ said that he preferred the submission of counsel for the plaintiff that, as between the local authority and Ms Jackson, she had all the rights of a secure tenant, but as between her and the plaintiff he had the better title; and that the plaintiff could, therefore, have dispossessed her as a trespasser, albeit she could then have sued the local authority for damages for breach of their covenant for quiet enjoyment. He then said that it did not follow, however, that the plaintiff's counsel was correct in submitting that the wife's notice to quit had to be served on Ms Jackson rather than the local authority. He gave his reasoning as follows at page 1026D:
"There was no contractual relationship between the [plaintiff] and Ms Jackson. There was, however, such a relationship between the [plaintiff] and Wandsworth and that was what the notice to quit was designed to end. I would hold it effective for the purpose."
- That conclusion about the proper person on whom the notice to quit should be served is, on the face of it, surprising. It appears, however, that the Court of Appeal did not have the benefit of as extensive a review of the law as we have enjoyed. The conventional position is, as we have said, that the tenant under the concurrent lease becomes the landlord of an existing periodic tenant by virtue of the assignment of the landlord's reversion, and so is the person entitled both to give and to receive notices to terminate the existing periodic tenancy. That is clear as a matter of general principle since a notice to quit terminates not merely a contract but the property interest represented by the relationship of landlord and tenant: see generally Woodfall paras 17.227, 17.229, 17.235, 17.240. The notion that, long after the assignment of the landlord's reversion and the tenancy, the tenancy can be brought to an end by the service of a notice on or by the original landlord or the original tenant (as the case may be) is unorthodox. Indeed, so far as concerns the position in the case of an overriding or concurrent lease where there is an existing periodic tenancy, there is direct authority that the tenant under the periodic tenancy and the concurrent lessee are the only persons by and to whom a valid notice to quit can be given: Wordsley Brewery Company v Halford  90 LT 89 (Lord Alverstone CJ, Lawrence and Kennedy LJJ). That case was not cited to the Court of Appeal in Osei-Bonsu. All the parties to this appeal are agreed, therefore, that on this point Osei-Bonsu was decided per incuriam, and that, on the assumptions so far made, it is for Mr and Mrs Ingham rather than the Council to serve any notice to quit to terminate any periodic tenancy still held by Mr Wall. We understand that such a notice has been served by them.
- We have discussed these points, but have been careful not formally to decide whether (1) Brent LBC v Botu is, notwithstanding the analysis of Lord Hoffmann in Birmingham City Council v Walker, binding authority that a secure tenancy is automatically terminated in all respects on the making of a possession order even if that order should not have been made, and (2) the grant of a periodic tenancy which satisfies the requirements of the Law of Property Act 1925 section 54(2) can be a valid concurrent or overriding tenancy even though not granted by deed. These are important points, on which our own inclinations are apparent from what we have said. They do not need to be decided in the present case, however, in view of our decision on the first ground of appeal, and so any decision by us would be obiter. They are better formally decided in a case in which they need to be. The discussion will, however, both inform and act as a warning of the significant legal and practical difficulties that can arise in circumstances similar to those of the present case. For the sake of completeness, it should be noted that no issue as to damages for breach of any covenant for quiet enjoyment was raised on this appeal.
Mr and Mrs Ingham's cross appeal
- In their Cross-Appeal Mr and Mrs Ingham contended that the Judge's decision to dismiss their application for costs against the Council was wrong. Mr McGuire QC conceded that the Judge had erred in dealing with their application as an application under section 51 of the Senior Courts Act 1981 (power to make a costs order against a non-party), rather than as an application under CPR 44 for costs against a party to a claim, but he nevertheless submitted that the Council's conduct had not been such as to warrant an order that it should pay Mr and Mrs Ingham's costs.
- Mr Karas submitted that Mr and Mrs Ingham had been "dragged to Court in circumstances not of their own making. These circumstances were of the making of the Council as much as Mr Wall." While we readily accept that Mr and Mrs Ingham were dragged to Court through no fault of their own, they were dragged to Court because Mr Wall was seeking a possession order against them. Far from seeking any order against Mr and Mrs Ingham the Council has always been supportive of their position.
- Mr Wall did not apply for a stay of the possession order made in December 2004. In the absence of a stay the Council could not reasonably be criticised for re-letting the property to Mr and Mrs Ingham. The pressures on local authority waiting lists are such that local authority housing stock should not be allowed to remain vacant any longer than absolutely necessary. Although the Council was criticized for conceding that it was estopped from denying that Mr Wall was a member of his foster mother's family for the purposes of sections 113 and 87 of the 1985 Act, it did so only after Lord Justice Wilson had said that he felt
"sure that the recorder's conclusion that Sheffield was estopped from disputing otherwise was correct."
- While we sympathise with the position in which Mr and Mrs Ingham have found themselves through no fault of their own, there is no good reason why the Council, rather than Mr Wall, should be ordered to pay their costs.
- In the result Mr Wall did not succeed to the late Mrs June Wall's tenancy and his claim for possession against Mr and Mrs Ingham must be dismissed, as must this appeal. The cross appeal by Mr and Mrs Ingham is also dismissed.
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