Houghton v Sheffield City Council

LORD JUSTICE MAY: This is another case where it may be that there was incomplete communication between departments of a local authority; the one department here in paying housing benefit and the other department as local housing authority having obligations under part 7 of the Housing Act 1996 and, additionally, receiving, as landlord, rent largely derived from housing benefit.

Mr Beglan, who appears on behalf of the applicant before the court today, suggests that extensive enquiries between the one department and the other should not be regarded by courts dealing with applications such as that in this case as necessary in all cases or as extensive as the judge in the present case may have thought.

The applicant is the Sheffield City Council. They seek permission to appeal from a decision and order of HHJ Moore, given in the Sheffield County Court on 11 August 2006. It would be, if permission is granted, a second appeal to which rule 52.13 of the Civil Procedure Rules applies. Accordingly, the Court of Appeal will not give permission unless there is an important point of principle or practice or some other compelling reason why the court should hear the appeal.

The court’s approach may, perhaps, be coloured by the fact that the first appeal was from an administrative, not a judicial, decision, but it would still be a second appeal. It is also necessary to note that the appeal to the county court had to be on a point of law; see section 204 of the Housing Act 1996.

The applicant’s application for permission to appeal was refused on paper by Neuberger LJ on 27 October 2006. In doing so, he gave quite extended written reasons.

The brief background facts are these. In April 2002, the respondent, Mr Ian Houghton, became an insecure tenant of the applicant at 5 Sheffield Road, Sheffield. This was an interim arrangement, as I understand it, between the applicant and the tenant under its general duties under part 7 of the Housing Act 1996. The respondent lived there with his father and he paid his rent substantially, though not exclusively, from money received from housing benefit. Mr Beglan tells me that the rent per week was in the order of £50 and that of an amount of that order some £13 had to be found above that which he received for housing benefit.

Mr Houghton was warned on various occasions that he had to continue to pay the rent on a weekly basis and clear what became existing arrears. He was told by the council that failure to do so could result in a Notice to Quit being served and that in those circumstances he would risk becoming intentionally homeless. It was on 7 January 2004 that the council delivered a notice warning him that if he continued to fail to provide details of his income to the housing benefits authority he might be in difficulties. On 9 February 2004, Mr Houghton received a letter from the housing benefits authority requesting that he provide necessary information to enable his claim to be processed.

The general picture that I have is that Mr Houghton did get somewhat in arrears with paying his rent and that a main reason for that was because he was not receiving housing benefit exactly at the time when it could or perhaps should have been paid; and there was some question as to the extent to which he was responsible for that.

On 16 March 2004, the council served a Notice to Quit. At the time they did so, there were rental arrears of £838 and a few pence. On 23 April 2004, possession proceedings were issued at the expiry of the Notice to Quit and at that stage there were rental arrears totalling over £1,000. On 22 June 2004, the possession claim came before the court. By that stage there had been a substantial payment to Mr Houghton of housing benefit and he had paid off nearly all his arrears of rent (at that stage the arrears stood at some £13). The court then ordered that the matter should be adjourned for four months, on condition that Mr Houghton should pay approximately £13 per week; that was the amount that he had to find above the level of housing benefit. At the end of the four-month period, it was envisaged that the applicant would either grant a new, more secure tenancy or proceed with eviction.

Mr Houghton did not pay this relatively modest amount of £13 a week on the nail, but housing benefit was paid on 29 June, 5 July and 11 October 2004. On 19 October 2004, which was the end of the four month period, the arrears stood at a mere £7.06. The applicant council, nevertheless, decided to proceed with eviction, as they were in law entitled to do. Possession was ordered and eviction occurred on 9 December 2004.

For the following few months it looks as if the respondent and his father lived rough, but on 4 November 2005, he applied to the council for housing assistance. On 23 January 2006, the applicant made a decision that he was homeless, eligible for assistance and in priority need, but that he was intentionally homeless within the terms of section 191 of the 1996 Act because he had failed to provide proof of his income to enable housing benefit to be processed for the premises at 5 Sheffield Road which, in turn, led to his eviction.

Mr Houghton requested a review of that decision and on 18 April 2006 the applicant made a review decision under section 202 of the 1996 Act,. The reviewing officer upheld the decision that the respondent was intentionally homeless for substantially the reasons that had been given in the initial decision.

Mr Houghton appealed this decision to the Sheffield County Court and it is against the decision of that court that the applicant council wishes to have permission to appeal. It is well known that the jurisdiction of the county court under section 204 of the 1996 Act is to consider whether there has been an error of law and the jurisdiction is akin to a judicial review; see for instance the decision of this court in Crawley.

The judge, in substance, approached the task he had on that basis. He considered the facts. He noted that in the period between 16 March 2004, when the Notice to Quit was issued, and 19 October 2004 substantial housing benefit payments were made on several occasions. He said that the material from the Housing Benefits Department was, in his view, remarkably thin. But he drew the conclusion from the fact that payments were made that Mr Houghton must have cooperated and provided the necessary information to be able to clear the arrears within the four-month adjournment period. He said this:

“The fact is that the Appellant plainly did not so fail. He may have dragged his feet from time to time. He may have had to be reminded. But it is clear that on several occasions during the operative months housing benefit was indeed processed and therefore he must have cooperated.

“The housing officer and the reviewing officer lamentably failed to find out what actual submissions the Appellant had made to housing benefit.”

This was, in the context of the judge’s understanding, correct, as it seems to me, from the terms of the decision. A substantial reason why the review decision had been made was a view that Mr Houghton had not taken due steps to get his housing benefit paid.

The judge said again, in paragraph 6, that the appellant must have been cooperating with housing benefit, otherwise the monies would not have been paid. Accordingly, the decision which he had already referred to he said was “bizarre” and so too was the reviewing officer’s decision that it was all right. He went on to decide, in substance, that the decision was perverse.

As I understand this decision of the judge and looking at it in the round, he was plainly reaching the conclusion that a person who had indeed, both at the time of the original county court proceedings and when it came to the end of the four-month period, actually succeeded in paying all his rent, other than perhaps the odd pound that was due, could scarcely, as a matter of common sense, be said to have been intentionally homeless.

The judge went on to say that there was no realistic possibility that further enquiries by the authority could lead to a conclusion that the respondent was intentionally homeless in relation to rent arrears. Accordingly, instead of remitting the matter for further consideration by the applicant authority, the judge (as he had power to do under section 204) varied the decision to a decision that the respondent was not intentionally homeless. As Mr Beglan points out, the consequences of that are that the applicant local authority is obliged to perform a full housing duty under section 193 of the 1996 Act.

It is against that decision that the applicant council wishes to have permission to appeal and Mr Beglan puts it in this way. He submits that it was not open to the judge on the facts to find that there was perversity. This was not a bizarre decision. The decision was based, he submits, on the fact that whatever the position may have been with housing benefit there was a part of the rent which Mr Houghton had to find himself, some £13 per week, and he was not even paying that. The court proceedings, he submits, were adjourned on the first occasion so that the applicant could monitor those payments and there was an obligation on the respondent to pay £13 or so per week during that period. He did not do so.

Mr Beglan submits that that constitutes a wilful refusal to pay. He makes that submission in the context of 191 of the 1996 Act, which provides that a person becomes homeless intentionally if he deliberately does or fails to do anything in consequence of which he ceases to occupy accommodation which is available for his occupation and which it would have been reasonable for him to continue to occupy. Subsection 2, for the purposes of subsection 1:

“An act or omission in good faith on the part of the person who was unaware of any relevant facts will not be treated as deliberate.”

The terminology of section 191(1) is perhaps more immediately obviously apt for a tenant who has voluntarily given up occupation of accommodation which is available for their occupation, but it is well known that substantial and wilful failure to pay rent is capable of coming within that statutory provision.

So, says Mr Beglan, this was, albeit in rather small sums, a wilful refusal to pay and it was not open to the judge to find that Mr Houghton was not intentionally homeless. He submits that the adjournment of the court proceedings was precisely to enable the respondent to pay on time and there was, he says, sufficient evidence before the judge to show that there had been non-compliance.

As to whether or not the conditions for a second appeal are fulfilled, Mr Beglan submits, first, on the basis of evidence which is before the court that this kind of situation arises frequently, and that Sheffield City Council has a large number of cases where there are difficulties perhaps with housing benefit but where tenants do not pay their rent on time. He submits that there is a serious issue in this case whether the county court may not be requiring a local authority to make enquiries, in this instance of those concerned with housing benefit, which are on subjects which may not even have been raised in the proceedings by those representing the tenant. He submits that the local authority and other local authorities need to know, if it be so, what kind and extent of enquiry has to be made. He says that a local authority in the position of Sheffield City Council in this case will always look to see whether the shortfall of housing benefit, which is part of the rent, has been paid and he submits that this is a good case to take forward to enable this court to give local authorities guidance. He suggests that there is a point of importance and that the judge was clearly wrong to find that the decision in this case, both originally and on review, was perverse.

As a subsidiary ground of appeal he submits that the judge should not have taken it upon himself to vary the decision but should, as is perhaps normal in these cases, have remitted the matter so that the applicant council could reconsider the decision following the decision of the county court.

I regret to say that I am quite unpersuaded that there is any point of principle arises in this case. The judge decided that this particular decision, both originally and on review, was perverse. It was a decision, in my judgment, limited to its own facts and it sustains no wide consequences for other cases, where the facts will probably and will usually be different. The judge was, I think, entitled to conclude that the respondent must have cooperated with the housing benefit department because his housing benefit was indeed paid. He was entitled, in my judgment, to conclude on the facts of this case that a decision that he was intentionally homeless when his tenancy was terminated when there was no, or virtually no, arrears of rent and when he must have cooperated with the housing department was bizarre.

If I ask myself, as I do, in Mr Beglan’s terms whether the judge was unable to find that the local authority were wrong in reaching a decision that this represented a wilful refusal to pay, it seems to me that it was entirely within the competence of the judge to reach the decision that he did in this particular case. Of course, the matter is arguable on its facts but that is the only point that arises.

In my judgment, the requirements of rule 52.13 of the Civil Procedure Rules are not met in this case; neither do I think that any point arises on the judge’s decision to vary rather than to remit.

Accordingly, for these reasons the application is refused.