Housing case law update - June 2024
Daniel Fitzpatrick, Jonathan Davidson and Tim Pearl round up of latest housing cases and court decisions of interest to local authorities and housing associations.
Ghaoui v London Borough of Waltham Forest [2024] EWCA Civ 405
Court of Appeal, 24 April 2024
The Court of Appeal has held that, when allocating a property, a council did not breach a family’s human rights when it did not place undue weight on their preference for a single-faith school.
Mr Ghaoui, a married man with two children, sought housing assistance from the London Borough of Waltham Forest (the Council) after the family were evicted from their home. The family lived in the Council’s administrative area and were placed in temporary accommodation in Harlow, approximately 20 miles from Mr Ghaoui’s place of work and the children's school (which was a private, fee-paying school only open to those of the Islamic faith).
The Council accepted that it owed Mr Ghaoui the main housing duty under section 193 of the Housing Act 1996 and offered him a 12-month fixed term assured shorthold tenancy with a private landlord in Harlow.
Mr Ghaoui requested a review of the property’s suitability, as its location made it harder for him and his wife to attend their workplaces, and for the children to attend the school. He explained to the Council that it was his preference for the children to attend a Muslim school rather than a multi-faith primary school.
The reviewing officer concluded that the property was suitable – the fact that Mr Ghaoui would prefer for his children to attend a Muslim school did not render the property unsuitable in terms of location, as there were several primary schools in Harlow. A preference for a particular religious school was not an essential requirement for the purposes of discharging the Council’s housing duty to comply with the Homelessness (Suitability of Accommodation) (England) Order 2012.
Mr Ghaoui appealed to the County Court arguing that the Council and reviewing officer had failed to consider his family's rights under Article 9 of the European Convention on Human Rights. The appeal was dismissed.
Mr Ghaoui appealed to the Court of Appeal, arguing that the review decision was unlawful as it did not recognise his preference for single-faith education, which was a freedom protected under Article 9 of the European Convention on Human Rights.
The Court of Appeal, in dismissing the appeal, held that there was no requirement for the Council or reviewing officer to conduct a “legal analysis” in order to identify applicable human rights. Their obligation was to reach a “sound decision” on the suitability of the accommodation based on the facts. They only needed to consider the European Convention on Human Rights as part of the overall evaluation.
The ruling highlights that when determining the suitability of accommodation, councils (and reviewing officers) do not need to give undue weight to human rights implications.
A copy of the judgment is here.
Howe Properties (Ne) Ltd v Accent Housing Ltd [2024] EWCA Civ 297
Court of Appeal, 27 March 2024
The Court of Appeal has considered the interpretation of service charge provisions within leases and whether a flat rate management charge was permissible under the terms of the leases.
Howe Properties managed an estate comprised of 138 properties, including freehold properties, flats held on long leases, and flats let to social tenants on assured tenancies. Accent Housing was the freeholder of four of the flats. The leases had each been granted under the “right to buy” provisions of the Housing Act 1980 and the Housing Act 1985 and provided for Howe Properties to pay a service charge in respect of the management costs incurred by Accent Housing.
Accent Housing charged a flat rate management fee of £300 per flat. However, Howe Properties challenged that fee in the First-Tier Tribunal, claiming that it was excessive and did not represent value for money.
The Tribunal held that the fee was calculated in accordance with the provisions of the lease and was a reasonable amount.
Howe Properties appealed and the Upper Tribunal (Lands Chamber) allowed the appeal, ruling that the First-Tier Tribunal had erred in finding that the charges imposed were reasonable, concluding that the flat management fee of £300 had not been charged in accordance with the terms of the lease. The lease did not permit a flat fee to be charged. Accent Housing appealed.
The Court of Appeal, in allowing the appeal in part, held that the Upper Tribunal had misunderstood the leases and misinterpreted their service charge provisions. It found that the leases allowed Accent Housing to charge “a proportionate part” or “a fair proportion” of the costs incurred at the estate back to the leaseholders as an annual service charge. The Upper Tribunal had been wrong to find that only an “equal part” or an “equal proportion” could be charged. The terms “proportionate part” and “fair proportion” did not necessarily equate to an “equal part” or “equal proportion” and allowed for more flexibility in the allocation of the service charge. The case was remitted back to the First Tier Tribunal for further consideration of the “payability and reasonableness of the management charge” for the years in question.
The decision highlights the importance of ensuring that service charges are justified and proportionate to the services provided.
A copy of the judgment is here.
Shah v McLaughlin and others [2024] UKUT 69 (LC)
Upper Tribunal (Lands Chamber), 18 March 2024
The Upper Tribunal had held that the First-tier Tribunal had been correct to determine that a property was an unlicensed house in multiple occupation.
Mr Shah was the sole shareholder and director of a company, TSMB Ltd, which owned a five-bedroomed house. The house was let to six people (the respondents) by a lettings agency under an assured shorthold tenancy agreement.
The respondents sought a rent repayment order against Mr Shah after discovering that it was an unlicensed house in multiple occupation (HMO). Mr Shah, however, contended that:
- he was not the landlord; rather the company, TSMB Ltd, was;
- the letting agency had been told not to let the property as an HMO and that he had only became aware that there were six unrelated tenants at the property when he received the rent repayment application.
The First-tier Tribunal found in favour of the respondents, finding that the assured shorthold tenancy agreement named Mr Shah as the landlord and that lettings agency had made it clear to him that the letting was to six tenants who were not related. The property therefore met the standard conditions for an HMO and required a mandatory licence.
Mr Shah appealed.
The Upper Tribunal (Lands Chamber), in dismissing the appeal, held that the First-tier Tribunal had made no error in finding that Mr Shah was the landlord and that the property was an unlicensed HMO. Mr Shah’s explanation regarding the property's letting arrangements lacked credibility. It affirmed the First-tier Tribunal decision and the rent repayment order made against Mr Shah.
A copy of the judgment is here.
Daniel Fitzpatrick is a Legal Director and Jonathan Davidson and Tim Pearl are Associates at Capsticks.
