Croydon London Borough Council v Chipo Kalonga
| Jurisdiction | England & Wales |
| Judge | Lady Arden,Lord Kitchin,Lord Briggs,Lord Leggatt,Lord Stephens |
| Judgment Date | 09 March 2022 |
| Neutral Citation | [2022] UKSC 7 |
| Year | 2022 |
| Court | Supreme Court |
[2022] UKSC 7
Lord Briggs
Lady Arden
Lord Kitchin
Lord Leggatt
Lord Stephens
Appellant
Kelvin Rutledge QC
Riccardo Calzavara
(Instructed by Croydon Council Legal & Democratic Services)
Respondent
Justin Bates
Anneli Robins
(Instructed by GT Stewart Solicitors (East Dulwich))
Heard on 12 January 2022
( with whom Lady Arden, Lord Kitchin, Lord Leggatt and Lord Stephens agree)
This appeal raises an important question of construction of the statutory regime governing secure tenancies, now to be found in Part IV (sections 79 and following) of the Housing Act 1985 (“the 1985 Act”). References in this judgment to numbered sections, without more, refer to sections of the 1985 Act. The question relates to the circumstances in which, and the means by which, a secure tenancy for a fixed term which has not yet expired by effluxion of time may be terminated by the landlord. The regime for secure tenancies was first introduced by the Housing Act 1980 (“the 1980 Act”). Its provisions were consolidated in the 1985 Act, which has been materially amended since then, but the question of construction has surprisingly lain dormant since 1980, and its answer is only marginally affected by those amendments.
Prior to 1980, residential tenancies granted by public sector landlords were not the subject of any form of statutory security of tenure, beyond that provided for all residential tenants by section 2 of the Protection from Eviction Act 1977, namely that a right of re-entry or forfeiture could not be enforced against them, while lawfully in residence, otherwise than by proceedings in court, by the statutory regime for notice of and relief from forfeiture in section 146 of the Law of Property Act 1925 (“the LPA”), and by the ragged mixture of general law and statutory provision in relation to forfeiture for non-payment of rent. Nonetheless public sector tenants (at least where the landlord was a local authority) were widely regarded as having a form of de facto security. In its Green Paper on Housing Policy published in June 1977 the Government announced its intention to clothe that de facto protection with the force of law. At para 11.07 it stated:
“At present the lack of statutory security of tenure is the most important respect in which the public sector tenant's position falls short of that of tenants in the private sector.
Local authority and new town tenants already enjoy a high degree of security in practice, and the Government propose to introduce legislation giving statutory recognition to this ‘de facto’ security.”
Inevitably this took the form of a regime which clothed the millions of existing tenants with statutory security of tenure beyond their existing contractual and proprietary rights, rather than merely providing for a new form of secure tenancy for the future. Although counsel could not offer any reliable statistics, it is very likely that the vast majority of existing public sector tenants had periodic tenancies, which offered no de jure security beyond the typically very short period required for a valid notice to quit. But a sufficient number had fixed term tenancies to make it necessary for specific provision to be made about them as well. A fixed term tenancy provides contractual security of tenure at least for the duration of the term, subject of course to forfeiture and to any other provisions for early termination (such as a break clause) which the tenancy agreement might contain. Quite apart from contract, a fixed term tenancy is also a valuable proprietary right, of which the undisturbed enjoyment of the demised premises for the entire duration of the term is its main element. Although forfeiture represents an inroad into that security, the court's originally equitable jurisdiction to relieve from forfeiture means that it will not generally be allowed to operate more severely than as security for the performance of the tenant's covenants. Although relief is discretionary, speaking very generally tenants are relieved from forfeiture if they remedy the breach which led to the forfeiture and (if necessary) undertake to behave properly in the future.
It will be necessary to set out the statutory regime for security of tenure in detail in due course but, in outline, its main elements have always been as follows. First, it defines a secure tenancy by reference to the identity of the landlord (as a public sector rather than private landlord) and by reference to a “tenant condition” which is that the tenant occupies the demised premises as their only or principal home. Secondly it provides that a periodic secure tenancy shall not be brought to an end by the landlord otherwise than as provided for in the 1985 Act. Thirdly it makes the same provision about a fixed term tenancy if it is “subject to termination by the landlord”. Fourthly it provides for a statutory periodic secure tenancy to follow upon the termination of a fixed term tenancy either by effluxion of time or by forfeiture. I will call that a “follow-on” tenancy for short. In that context it makes provision to cut down the right to forfeit from a right of re-entry to a right only to bring the fixed term tenancy to an early end.
The permitted means whereby a secure tenancy may be brought to an end by the landlord were originally two in number: first, by obtaining an order for possession on one of a number of specified grounds (which have been added to over time). Secondly, by obtaining a termination order in lieu of forfeiture, in relation to a fixed-term tenancy. In 2003 a third method was added, namely the obtaining of a demotion order on the ground of anti-social behaviour by the tenant or by someone residing in or visiting the house. Neither the second nor the third method enables the landlord to resume possession. The termination order gives rise to a follow-on tenancy, while a demotion order temporarily replaces the secure tenancy with a demoted tenancy which only provides reduced security of tenure.
The statutory grounds for possession, set out in Schedule 2 to the 1985 Act, may loosely be divided into three groups. Grounds 1 to 8 are mainly based on some default or misconduct by the tenant. If the ground is established, the landlord must also show that it is reasonable to make an order for possession. Grounds 9 to 11 may be loosely described as social housing management grounds. There is no requirement that it should be reasonable to make an order for possession, but the landlord must show that suitable alternative accommodation will be available to the tenant. Grounds 12 to 16 may also be described as management grounds, but they require both that it be reasonable to make an order for possession and that suitable alternative accommodation will be available: see section 84 of the 1985 Act.
The critical question to be determined on this appeal is whether the secure tenancy regime in the 1980 and 1985 Acts merely adds statutory security to the contractual and proprietary security already conferred by the tenancy itself, or whether it replaces it, and thereby to some extent reduces or removes that contractual and proprietary security. Two examples will suffice to illustrate the problem. The first summarises the assumed facts of this case. A secure tenant commits breaches of her fixed term tenancy agreement, sufficient to satisfy one or more of grounds 1 to 8. Can the landlord simply seek possession of the house before the tenancy expires by effluxion of time, or must the landlord also terminate the fixed term by a termination order in lieu of forfeiture (assuming that forfeiture is provided for under the tenancy agreement), and thereby enable the tenant to seek relief?
The second example relates to a five year fixed term tenancy with a landlord's break clause exercisable by notice expiring at the end of year two. The landlord wishes however to obtain possession for redevelopment purposes at the end of year one. Can the landlord terminate the fixed term at the end of year one, under ground 10, which is available at any time during the tenancy? Or must the landlord first serve a break notice, and wait until the end of year two? A more rigorous example would be a tenancy for four years with no break clause at all. The tenant has five years' contractual security (subject only to forfeiture). Can a model tenant who commits no breach of the tenancy agreement be removed earlier than at the end of the five years, merely because the landlord wishes to redevelop and cannot reasonably do so without obtaining possession?
I have deliberately framed this question in more general terms than did the parties, focussed as they understandably were on the facts (or rather the assumed facts) of this case. I have added the redevelopment example because a break clause is perhaps the most common means whereby a fixed-term tenancy may be terminated earlier than by effluxion of time, other than by forfeiture. A sound interpretation of the statutory provisions must accommodate both examples. There are other ways in which a fixed-term tenancy may come to an early end under the general law, such as rescission for misrepresentation or failure of a condition. But these are much less common, and their detailed examination does not shed significant further light on the problem.
This is a second appeal from a decision of the High Court (Tipples J) on preliminary issues, necessarily on assumed facts about the allegations of rent arrears and anti-social behaviour which underlie the landlord's claim for possession. Subject to one point the issues are not fact-sensitive, so that the assumed facts may be shortly stated. The appellant local housing authority Croydon London Borough Council...
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The Queen (on the application of [Kalonga]) v London Borough of Croydon
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