Birmingham City Council v Walker

This appeal raises a short point on the construction of a provision of Part IV of the Housing Act 1985, which consolidates the law on secure tenancies originally introduced by Chapter II of Part I of the Housing Act 1980. Mrs Betty Walker was a secure tenant of a house in Birmingham belonging to the local authority. When she died in February 2004, her son Paul was living with her in the house. Section 89 of the 1985 Act provides that where a secure tenant dies and there is a person "qualified to succeed" her, "the tenancy vests by virtue of this section in that person". By section 87, a member of the tenant's family occupying the house at the time of her death is qualified to succeed. But there is a proviso which excludes any succession to a tenant who was herself a "successor" as defined in section 88(1). That definition includes the case (paragraph (b)) in which the tenant "was a joint tenant and has become the sole tenant". In this case, Mrs Betty Walker was once a joint tenant. She and her husband were granted a joint tenancy of the house in 1965. When he died in 1969, she became the sole tenant. But that was long before the 1980 Act came into force and her tenancy became a secure tenancy. So the question is whether "has become the sole tenant" refers to any time in the past or is limited to a case in which she became the sole tenant under a secure tenancy, that is to say, after the 1980 Act came into force. Judge Hamilton thought it meant the former but the Court of Appeal (Mummery and Rix LJJ, Peter Smith J) said it meant the latter ( [2006] 1 WLR 2641).

Until the passing of the 1980 Act, tenants of local authorities and similar public sector landlords had no security of tenure. They were excluded from protection under the Rent Act 1977: see sections 14–16. Part I of the 1980 Act conferred two benefits upon public sector tenants. Chapter I gave them the right to buy the freehold (if it was a house) or a long lease (if it was a flat) of their dwelling at a discounted price to be left outstanding on mortgage. Chapter II introduced the concept of a secure tenancy for public sector tenants.

The secure tenancy, like the statutory tenancy in the private sector, can be terminated only by an order of a county court made on one of a list of specified grounds. But the technique by which secure tenancies are integrated into the ordinary law of landlord and tenant is very different from that which was used in the Rent Acts more than 60 years earlier. The old legislation had left untouched the landlord's right to determine a contractual tenancy by notice or otherwise in accordance with its terms and the general law. It provided that, on such termination, the tenant acquired a new interest which is now called a statutory tenancy. The 1980 Act, on the other hand, preserved the contractual tenancy. It merely added statutory incidents to that tenancy which overrode some of the contractual terms. These overriding provisions include the provisions which prevent it from being terminated except by an order of the court on the statutory grounds.

From their earliest days, the Rent Acts provided that when a tenant died, his security of tenure could be transmitted to his widow or another member of his family: see the definition of "tenant" in section 12(1)(g) of the Increase of Rent and Mortgage Interest (Restrictions) Act 1920. The original provision for transmission could operate only once: see Whitmore v Lambert [1955] 1 WLR 495, 498–499. But section 13 of the Rent Act 1965, passed immediately after the election of a Labour government, provided for a second transmission and that remains the position today: see Part I, Schedule I of the Rent Act 1977. A person to whom the tenancy is transmitted becomes a statutory tenant. Under this system, the provisions which limit the number of times which the mechanism of transmission can operate are extremely simple. The 1977 Act says that they shall only operate twice. This obviously makes it irrelevant to consider anything which happened before the provisions for transmission came into force.

The method adopted by the 1980 Act to deal with transmissions is different. It reflects the fact that a secure tenancy is different in nature from a statutory tenancy. Whereas the statutory tenancy is unassignable, not an estate in land but a mere "personal right of occupation" (see Lord Greene MR in Carter v SU Carburetter Co [1942] 2 KB 288, 291), a secure tenancy is an orthodox estate in land which, subject to specific restrictions in the 1980 Act, can be assigned, held in joint names, pass by survivorship and be disposed of by will on death. Thus, while a statutory tenancy can pass from one person to another only in very limited circumstances (such as the statutory transmission on death or by a court order on divorce) a secure tenancy can in principle pass in any way permissible at common law.

The 1980 Act was introduced by a newly elected Conservative government and its policy was to allow transmissions of secure tenancies only once. But this policy could not be given effect, as in the case of the Rent Act, simply by providing that the transmission...