New Year brings new Judicial Review claims against Landlords

Article

20 January, 2010

2009 could arguably have been seen has a turbulent year for landlords and other social housing providers in the context of judicial review. With the decision in R (on the application of Weaver) v London & Quadrant Housing Trust [2009] EWCA Civ 587 still being digested, January 2010 saw one of the first judicial review claims against a Registered Social Landlord in the 'post-Weaver' era.

In R (on the application of McIntyre) v Gentoo Group Limited [2010] EWHC 5, the High Court was asked to consider a case where the landlord had refused permission for the tenants to exchange homes with another assured tenant. The decision in this case will be of interest to all social housing providers.

Background

The husband and wife tenants (R) lived in a property in Sunderland let to them by the City Council from May 1984. In 1996, the husband left the property and found other accommodation with the Council. He fell into rent arrears and consequently the Council obtained judgment against him for the amount. The order was not able to be executed and the husband had not paid any of the sum as ordered by the court.

A stock transfer took place in 2001 which left R with an assured tenancy with North Sunderland Housing Company (NSHC) (who later became part of Gentoo in July 2007). In April 2007 R applied for consent from NSHC to enable them to exchange tenancies with a fellow tenant. NSHC refused to grant this due to the fact that there were rent arrears and court costs outstanding in respect of the husband's former accommodation.

It also appeared that R's solicitors had a telephone conversation with NSHC where an offer was made that, if consent was granted, the husband would pay the outstanding amount through instalments. They also wrote to NSHC asking for a reconsideration of the decision, contending that it was unreasonable to withhold consent on the basis of an irrecoverable debt, that the wife was being punished for an incident that was not her fault that and that a strict policy of refusing exchange on the basis of historical rent arrears was unreasonable.

NSHC replied stating that consent was not being withheld and that it was conditional on the husband clearing the rent arrears owed before any move could take place and that it was entirely reasonable to require the money to be paid. They also said that the offer to pay via instalments was unacceptable, given their previous dealings with the husband.

The Influence of Judicial Review

One of the key aspects of the case was whether the decisions taken by the landlord were able to be scrutinised by a judge. In this instance, it stated that because registered social landlords may have greater freedom than local housing authorities in relation to responding to applications for mutual exchange, it did not mean that they did not need to have regard to their 'public' function of managing and allocating social housing. Therefore, the decision of the Court of Appeal in Weaver to find that judicial review was available applied not only to verdicts reached in relation to termination a tenancy, but also to the mutual exchange of such tenancies.

The High Court's Decision

At the High Court, it was R's contention that the decisions reached by NSHC were ones which no reasonable landlord would have reached and therefore should be quashed. Conversely, NSHC's argument was that there were alternative remedies that were available for R to use, namely to bring proceedings under the Landlord and Tenant Act 1988 through an 'ordinary' civil claim or to make a complaint to the Housing Ombudsman. The fact that R had not made use of either of these two options meant that judicial review (deemed to be an option of last resort) was not a suitable remedy.

In its judgment, the High Court stated that the condition imposed by NSHC in order for exchange to take place was not lawfully imposed and that it had nothing to the landlord/tenant relationship. The decision was accordingly unlawful in public law.

However, having regard to the fact that an alternative remedy was available to R by way of an 'ordinary' claim, the application for judicial review was refused.

The judge also stated that future claims concerning decisions to refuse permission to assign or exchange, or to grant permission on conditions, to which the 1988 Act applies should normally be brought by an 'ordinary' claim, even if they also include an argument that the decision of the landlord was unlawful under public law.

Summary

It should be noted that although the court refused the application for judicial review, this was seemingly only due to the fact that the tenants had alternative options open to them. It had been ruled that the decision of the landlord to impose conditions upon granting consent for exchange was unlawful as it related to a different property.

Social landlords should consider the judgment in this case when faced with future applications for mutual exchange and deal with such requests in a manner which is compliant with their obligations under public law.

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

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