Faarah, R (on the application of) v London Borough Of Southwark

This is a case about the allocation of accommodation by a local housing authority. Has the priority date in the Band in which the Claimant has been placed for housing allocation been arrived at unlawfully? Is the Defendant’s scheme by which applicants bid for accommodation unlawfully random and arbitrary?

The Claimant Mrs Faarah applied for judicial review on 12 October 2007 and permission was granted by Wilkie J on 14 January 2008. I have helpful witness statements from Ms Carrier for the Claimant and from Ms Cobb for the Defendant and an agreed bundle of documents..

Mrs Faarah is a tenant of the Defendant (“Southwark”) and lives in a three bedroom flat on the top floor of a three storey block with her sister and with her seven children born between 1994 and 2005. The flat has been assessed under Southwark’s space standard. It has four bed spaces when the occupants need nine. The Claimant and her family have medical difficulties. Mrs Faarah has severe back problems. One of her daughters is asthmatic.

On 25 June 2003 Mrs Faarah applied to Southwark for a transfer and she was assessed under the allocation scheme in place (“the Old Scheme”). Southwark introduced a new Choice Based Lettings scheme (“the New Scheme”) on 19 September 2005. Under the Old Scheme (only some details of which are material to this application) the Claimant was assessed as having 45 points on 1 July 2003. She received 25 points for overcrowding, being 5 points for each of the 5 bed spaces (i.e. 9 minus 4) not provided. She received 20 points based on a medical assessment carried out on 8 April 2003. Under the Old Scheme the medical need fell into four categories, 10 points, 20 points, 30 points and, most severe of all, “urgent medical need”. Southwark’s Grounds refer to awards of medical points in intermediate numbers but the policy does not refer to this and it is the experience of Southwark Law Centre that assessments were in practice made only at the these four levels identified. The definition of 20 points, which Mrs Faarah received, is “any household which includes a person(s) with an illness or disability and which is affected by their current living conditions and a move is needed to alleviate the medical condition”.

Southwark’s New Scheme assesses priority for applicants under four Bands, Band 1 the highest, Band 4, no priority. Applicants bid for properties advertised in “Southwark Homesearch” which is published in hard copy with photographs and on line. Copies of this publication are in the bundle before the court and show not only properties on offer but also the Band numbers of successful bidders for the homes advertised in the last edition. Applicants can judge, but only in broad terms, their prospects of success when bidding for particular categories of property. A property goes to the bidder in the highest Band. Where there are two bidders within the same Band the one with the earlier priority date prevails.

It is now common ground that Mrs Faarah should be in Band 2 because of overcrowding and medical needs. Her priority date remains in dispute. The Claimant contends it should be 1 July 2003 and the Defendant a date in 2007. On 30 August 2005 the Defendant informed the Claimant that she was in Band 4 with a date of 1 July 2003. On 3 August 2006 she was informed that she was in Band 3 with a date of 19 September 2005. On 8 August 2007 she was told that she was in Band 2 with a date of 27 April 2007 “the date of a recent medical assessment”. On 27 September 2007 the Defendant stated that the Claimant “did not have a medical priority until a medical assessment was carried out on her daughter on 4 July 2007”, the date on which the Defendant relies.

Under the New Scheme Band 3 is described, at paragraph 3.9; “Medical Priority. Households which include a person (or persons) whose illness or disability is made worse by their present home and who need a move to improve the effect on their medical condition will be awarded Medical Priority for registration in Band 3”. The Claimant points out that the definitions in Band 3 and 20 points are almost the same. The Defendant suggests a distinction between “affected” and “made worse” but it is improbable that “affected” in this context would refer to some illness being improved by someone’s current living conditions.

Paragraph 3.12 says this; “Multiple Needs. Applicants who qualify to be registered in Band 3 for more than one of the following points:

Part 3.1.2, dealing with priority on the housing list states “the date the relevant priority is awarded becomes the registration date within that Band. Priority for an offer will then be determined by Band and the relevant registration date in that Band. No distinction is made between the different priority reasons within each Band, only the date registered in the said Band”. As the “relevant priority” is under a scheme that has only existed since 19 September 2005 one would expect there to be no earlier priority dates. However it is clear from Homesearch that many applicants have much earlier priority dates.

Mr Latham for the Claimant complains that this published scheme does not reflect the policy actually being operated (and is thus a breach of sections 161(1) and 168 of the Housing Act 1996 to which I refer shortly). He is right about that. Against that the Claimant recognises the fairness of a priority date system preceding September 2005 and indeed her case for an earlier priority date depends upon it.

The Claimant’s case is straightforward. She asserts that she was awarded 20 points registered on 1 July 2003. The threshold for 20 medical points is equivalent to that for Band 3. The element of overcrowding that brings her from Band 3 to Band 2 has been constant throughout so her Band 2 priority date should be 1 July 2003. Although the difference in date may seem a minor matter the Claimant asserts that she may have to wait years to be rehoused if her priority date remains as it is.

Mr Broatch places a different emphasis on these matters. Southwark’s previous points based system has been replaced by a banding system which the Authority believes is in accordance with the Housing Act 1996, as amended by the Homelessness Act 2002 and with government policy and modern trends. The banding system has greater clarity and transparency than one based on points particularly as priority between applicants within the same band depends on time spent within that category. Similar considerations have led the authority to adopt a choice based lettings policy. As a banding system is simpler and more transparent than the old system and this, particularly in the transitional stage, will bring disappointment to some. The Defendant is however entitled to opt for a choice based letting scheme the policy behind which is to empower applicants for social housing. The Defendant suggests that it is better for applicants to choose the accommodation in which they want to reside, than have it selected for them by the Housing Department.

The evidence of the Defendant is that when the schemes changed existing applicants were placed into 3 categories A, B and N. Those in A were given medical priority under the New Scheme and were given as a priority date the day on which they had been awarded 21 or more points under the Old Scheme. Those with between 10 and 20 points were placed in category B and given no medical priority under the new scheme. N was for those with 10 medical points or less. The Defendants say that as a banding system must be simpler by its very nature “those with some form of medical condition which did not amount to a medical priority did not have this reflected in their new banding”.

The Defendant submits that as the Claimant had 20, not 21 or more, points she fell into B and as a result was in Band 3 by reason only of the overcrowding consideration that had given her 25 points under the old scheme. Once her daughter was reassessed on 4 July 2007 there was a new medical priority which, added to the overcrowding which had placed the Claimant in Band 3, placed her into Band 2 from 4 July 2007. The Defendants say that the priority date must be that which an applicant obtains on promotion to a new band as this is the only fair approach.

The relevant principles are common ground at least as regards this aspect of the case and may be summarised as follows (which I take, only slightly modified, from Mr Latham’s skeleton argument):

An authority is entitled to allocate housing accommodation in such a manner as it considers appropriate subject to the provisions of Part 6 of the Housing Act 1996 (s.159(7)). Every local housing authority is obliged to maintain an allocation scheme for determining priorities and the procedure to be followed in allocating housing accommodation (s.167). For this purpose “procedure” includes all aspects of the allocation process, including the persons or descriptions of persons by whom decisions are to be taken” (s.167 (7)). It unlawful for an authority to allocate accommodation except in accordance with their allocation scheme (s.167 (8)).

An authority must publish a summary of its allocation scheme and provide a copy of it free of charge to any member of the public who asks for one. An authority must also make the scheme available for inspection at their principal office and shall provide a copy of the scheme, on payment of a reasonable fee, to any member of the public who asks for one (s.168).

Section 167(1A) provides that the scheme shall include a statement of the authority’s policy on offering people who are to be allocated housing accommodation –

An allocation scheme must be framed in such a way as to secure that reasonable preference is given to specified categories of housing need (s.167(2)), namely :

The legislative purpose was summarised by Collins J sitting in the Court of Appeal in L.B. Lambeth v A, L.B. Lambeth v Lindsay [2002] EWCA 1084, [2002] HLR 898 at [18]:. “This can be encapsulated in the requirement that the scheme in question has a mechanism for identifying those with the greatest need and ensuring that so far as possible and subject to reasonable countervailing factors (for example, past failure to pay rent et cetera) they are given priority”. The correct approach is to ask whether the scheme is a rational means of achieving the objective of identifying and given priority to those in greatest need (at [19]).

The Claimant complains that Southwark acted unlawfully in its determination of her application under part 6 because her allocation has not been in accordance with the scheme as section 167(8) requires.

There is imprecision about the A, B and N categories. There are memos (12 July 2006 and 4 January 2007) which indicate that zero points became N, 10 points C, 20 points B and 30 points A. But there is a internal note by Mr Crook dated 12 July 2006 headed “Home search Medical Assessments on iWorld”. I accept that this document may have been prepared for an IT purpose but it may be significant given that decisions are placed on computer data for a purpose. The note begins “The part of the home search system on iWorld that deals with medical assessment is the only part now that still makes use of a points calculation. One or more individuals in a household is awarded 10, 20 or 30 points and then these are used as a factor in determining the applicant’s home search band” (this notwithstanding the change to the New Scheme in September 2005). The note says that Homesearch “boils down to just 4 business rules …” One of these rules is “if there is a person with 20 medical points and at least one other person with any number of medical points then they are entitled to a “Band uplift” …if the application also has priority due to homelessness, overcrowding or insanitary conditions, then the uplift is from Band 3 to Band 2”. These statements are difficult to reconcile and, in any event, they form no part of the published scheme enabling potential applicants to understand the rules. Introduction of A, B and N as part of the transition has, by means of an unpublished filter, taken the Claimant from one medical status to a lower one despite the old and new criteria being virtually identical .

The Defendant has and should have a considerable degree of discretion in how it goes about complying with the Act. A borough with the problems of Southwark may well have to devise and apply policies very different from those of other authorities. Southwark was entitled to change from the points based scheme to the choice based scheme and in making transition arrangements there will inevitably be some rough justice. Some people will do better and others will do worse. It is not for the Claimant (as her Counsel appears to do in paragraph 6.4 of his Skeleton Argument) or for the Court to tell Southwark precisely what adjustments should have been made or whether some other approach should be adopted. Against that the Claimant appears to me to have been unjustly treated. I can discern no difference between the requirement of 20 points under the Old Scheme and Band 3 under the New one. The wording is virtually identical and fresh medical assessments have, understandably, not been carried out. With the best of motives the Defendant has, by adopting the “A, B, N” coding, built, a process by which those who have qualified for one set of wording under the Old Scheme are treated as having failed to meet the same wording under the New Scheme. The Defendants would no doubt have been entitled to treat those with 20 points under the Old Scheme as not within Band 3 of the New Scheme if the criteria had been at least slightly different. It appears that the scheme being operated is, in breach of Section 167(8), not that being published. It gives other applicants priority from the date they qualified for a band even though this was before September 2005. In failing to give those who reach Band 3, and then Band 2, priority back to the date upon which they qualified for Band 3 medical priority (ie 20 points) Southwark is failing to allocate fairly and rationally under the Act as regards those in the position of the Claimant and to that extent is acting unlawfully.

Southwark’s starting point is that sub-section 2(A), as illustrated by the case of R v Westminster City Council ex parte Al-Khorsan (2001) 33 HLR 77, gives an authority a very substantial measure of discretion as to how it will frame its scheme. Provided reasonable preference is given to each of the five categories of applicant in (a) to (e) of sub-section 2, it is for Southwark to decide the degree of priority, or comparative priorities, to be afforded to persons in each of those classes.

Under the bidding scheme which I have mentioned above applicants were originally able to place two bids in every fortnightly cycle. With effect from 2 November 2006 Southwark changed its practice so that applicants could place just one bid but in a weekly bidding cycle. In one sense applicants may still place two bids every fortnight because they can withdraw a bid and place another one instead within the same cycle provided they only have one live bid in each cycle. Skilled operators of the online bidding process are likely to be a minority of the disadvantaged who qualify for housing.

Southwark’s evidence is that it changed this practice to minimise the vice of properties standing empty. Weekly cycles result in empty properties being re-occupied more quickly. Furthermore if applicants can bid for two properties during the cycle there is a risk that someone who is successful will not accept that home but hold out for another property in the same cycle. This risks the property remaining empty for a longer period. Southwark wishes to use all social housing within its area to the greatest percentage of occupancy possible. It is well known that Southwark is an inner City area with a high density of population. It has many diverse local communities and within the borough there are great problems of poverty which are helpfully and eloquently set out in the witness statement of Miss Cobb.

The Claimant contends that this scheme results in accommodation being allocated in a random and arbitrary manner because only one bid is permitted. The statement of Ms Carrier gives an example of what can happen with two identical properties being advertised. An applicant for the first property may fail in circumstances where he or she would have succeeded if bidding for the second property instead. With the ability to place two bids that risk is greatly reduced. Essentially the Claimant argues that by restricting bidding to one per cycle Southwark is allocating properties not for those in greatest housing need but according to the random choices of the various applicants in the contest. The Claimant says that this constitutes irrationality requiring the intervention of the court and relies upon the case of R v London Borough of TowerHamlets, ex parte Mohib Ali et el (1993) 25 HLR 218 per Rose LJ at p228. That case was concerned with allocation of housing under section 22 of the Housing Act 1985. The judgment of the court referred to various safeguards that had been introduced. In quashing the particular policy with which it was concerned the court said “it seems to us to follow that the removal of those safeguards, together with the apparently arbitrary and random way in which the ALC operate in different neighbourhoods, without any proper justifications, demonstrates unfairness and irrationality requiring intervention by the court”.

Southwark submits that the variations to the bidding scheme must be seen against the purpose to which I have already referred. Southwark says that these are not arbitrary or unlawful changes but administrative ones made for a legitimate public policy objective and, whatever their effect upon individual applicants in particular cases, are in the broader interests of the community as a whole within the area. Southwark says that the examples given by the Claimant are atypical. What the Claimant complains of is a consequence of there being a choice based lettings system with flexibility for different applicants in different bands having different priority dates to bid for the same properties. It does not arise from the fact that applicants can now make only one bid in a weekly cycle rather than two in a fortnightly one. Southwark submits that there is an element of chance in any bidding process or indeed one involving choice. Desirable properties will attract a lot of bids, applicants in lower bands and with recent priority dates will be less likely to succeed than others. Whatever the disadvantages for particular applicants in a weekly bidding run these are off-set by the general public and policy advantages from a choice based scheme. Finally Southwark submits that the decision in Mohib Ali does not establish a rule of law but reaches conclusions on particular facts applying broad and well recognised principles.

As I indicated at the end of the hearing I consider that the Claimant’s complaint is without merit essentially for the reasons given by Mr Broatch. The choice based policy is a legitimate one for Southwark to adopt particularly given its special problems and circumstances. The overall effect of the bidding scheme is entirely in accordance with the objectives of the Act and the fact that on individual occasions applicants are aggrieved, sometimes legitimately so, is beside the point. All systems for allocating scarce resources amongst large numbers of deserving applicants inevitably throw up anomalies. Mrs Faarah is in truth in no worse a position than any other applicant and this is a world where if she receives new accommodation faster someone else will get it slower. Moreover the paramount importance for Southwark of maximising the use of its housing outweighs any minor anomalies or individual injustices of the kind identified by Mr Latham.

I accordingly conclude that the decision of Southwark to give the Claimant a priority date of August 2007 rather than July 2003 is unlawful but otherwise the claim fails. Southwark submits that even if I find in favour of the Claimant I should refuse relief in my discretion because this might be disproportionate or detrimental to good administration. Southwark contends that the matters here are comparatively trivial when set against the broad operation of the scheme. I will hear submissions from the parties about remedy when handing down judgment by which time Southwark will be able to indicate how, if at all, they propose to respond to the views expressed in this judgment.

I shall be grateful if counsel will let me have a note of any corrections of the usual kind and such further directions and relief which they seek not less than 48 hours before this judgment is handed down.