Judicial Review may be used as London & Quadrant Appeal Dismissed

Article

19 June, 2009

The eagerly awaited judgment in the case of London & Quadrant Housing Trust v R (on the application of Weaver) & Equality & Human Rights Commission {2009} EWCA Civ 587 was provided on 18 June 2009.

The case has previously been the source of considerable discussion by landlords and housing practitioners alike. It was an appeal against the Divisional Court's earlier ruling that the Trust, as a provider of social housing, was subject to human rights principles when they elected to terminate the tenancy of Weaver (W) and thus the procedure of judicial review was held to be open to tenants in similar situations. The ruling of the Court of Appeal is significant in that the consequences may be a significant alteration in the operations of social housing providers, if they are in fear of being judicially reviewed at a later date.

Registered Social Landlords are traditionally funded by income acquired by the payment of rent by tenants, private borrowing and social housing grants. Although control over the RSL's housing stock is normally left with them, they can be subject to allocation arrangements made with local authorities. It was the nature of the 'private' organisation and the right to make decisions as a commercial enterprise which was in conflict with the 'public' policy of provided social housing

The Facts

The Trust was classified as a RSL and as such was regulated by the Housing Corporation. The Trust had charitable status and sought to provide social housing to individuals who were likely to be unable to find alternative accommodation of their own. W had been served with an order for possession of the property on the grounds of at least eight week's worth of rent being in arrears. W sought judicial review of that decision, claiming that her eviction would interfere with her human rights.

Within the legal arguments surrounding this possession order, it was considered if the Trust was a public body within the meaning of the Human Rights Act 1998 and thus, could have its decisions scrutinised judicially. The Divisional Court found that the Trust's allocation and management of its housing stock was a public function, in that significant public subsidies were awarded to RSLs which were designed to contribute towards the governmental policy of providing low cost housing to individuals. Therefore the act of ending W's tenancy was not a 'private' act which would avoid the potential for judicial review.

The principal question to be assessed by the Court of Appeal was whether, in terminating the tenancy of W, the Trust was subject to human rights principles and could only be advanced if in the exercise of its powers, the Trust was a public body which could fall within the scope of judicial review.

W argued that most RSLs are funded in order to fulfil an important function of government and that the decision on who should be allocated the benefit of social housing, the terms on which a tenancy is offered and the decision to remove a tenant are all related to the exercise of rights which are private in form, but public in substance. The Trust submitted that no-one had a right to a house and that local housing authorities are under no general duty to provide accommodation. The Trust also said that in order to constitute a public body, it was necessary for the state to have control over the exercise of the organisation's powers, but that in this instance, there was none as the Trust entered into its own contracts and controlled its own affairs.

The Court of Appeal's Decision

To begin with, the Court of Appeal felt that the key question to be addressed of whether W's human rights were engaged was by examining if the termination of the social tenancy was a private act.

In order to be able to characterise the nature of the act in question, an assessment had to be carried out of the context in which it occurred. In W's case, it was felt by the court that there were a number of features which led to them considering that the termination of the tenancy was within the remit of the 1998 Act. These included the Trust's function of allocating and managing its housing stock, the fact that the Trust relied to a significant degree upon public funding, acted in the public interest with charitable objectives and, although it did not directly take the place of a local authority in the provision of housing, it operated in close harmony by assisting in satisfying the authority's duties and objectives. The court also considered that the provision of housing could be described as governmental and was the antithesis of private commercial activity.

When all of these factors were contemplated as a collective, the act of terminating a tenancy was so inextricably linked to the provision of social housing that once the latter had been thought of as being public, the acts involved in the regulation of these functions should also be deemed as public in nature.

The court was of the view that the granting and ending of a tenancy were both examples of how it was decided which individuals would receive a public benefit. The act of terminating a tenancy was not incidental to the Trust's primary function of offering social housing. If the act of termination was to be thought of as a private act, this would significantly undermine the protection which Parliament had intended to give to tenants of RSLs and similar organisations and would severely limit the significance of corporate bodies being identified in such a way.

Accordingly, the court held that the act of terminating the tenancy of W did not constitute an act of a private nature and was in principle subject to human rights considerations. Accordingly, the appeal brought by the Trust was dismissed.

Significantly the court also stated that this protection afforded by the Human Rights Act would extend to all individuals who were tenants in the social housing sector and additionally that it does not necessarily follow that every RSL would necessarily be in the same position as London & Quadrant Housing Trust. The court stressed that the determination of the public status of an organisation was fact sensitive and that if a particular housing provider had not received any public subsidy at all, the outcome could be quite different.

Summary

The potential consequences of the decision in London & Quadrant may be significant for all social landlords. The decision may have opened the way for RSLs and other social housing providers to have their decisions judicially reviewed in the future. This would have obvious costs to them in terms of both time and money. Having to operate the possible threat of judicial review in the background could mean landlords are more reluctant to take a particular course of action and may be a considerable restriction on the management prerogative.

However, it should also be noted that the court stressed that not every housing organisation which provides social housing would fall into the same situation as London & Quadrant Housing Trust and that each case should be considered on its facts, especially in terms of the levels of public funding provided. Furthermore, the fact that the decision was reached on a majority verdict, with Lord Justice Rix dissenting relatively forcefully, means that the end may not be nigh for this case.

For more information and assistance on these issues, please contact the Housing Litigation Department at Forbes Solicitors on 01772 220200 or contact Stuart Penswick by email.

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