Merton London Borough Council v Jones
| Jurisdiction | England & Wales |
| Judge | Lord Justice Wilson,Lord Justice Wall,Lady Justice Arden |
| Judgment Date | 16 June 2008 |
| Neutral Citation | [2008] EWCA Civ 660 |
| Docket Number | Case No: B5/2007/1452 |
| Court | Court of Appeal (Civil Division) |
| Date | 16 June 2008 |
[2008] EWCA Civ 660
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CROYDON COUNTY COURT
H.H. JUDGE ELLIS
Royal Courts of Justice
Strand,
London, WC2A 2LL
Lady Justice Arden
Lord Justice Wall and
Lord Justice Wilson
Case No: B5/2007/1452
LOWER COURT NO: 6CR22664
Mr Robert Latham (instructed by Hammersmith and Fulham Community Law Centre) appeared for the Appellant
Mr Lloyd Sefton-Smith (instructed by Civic and Legal Services, London Borough of Merton) appeared for the Respondents
Hearing date: 6 March 2008
SECTION A: INTRODUCTION
If a former secure tenant of a dwelling-house who has become a “tolerated trespasser” in it decides to cease to occupy it, does his liability to pay mesne profits to his former landlord in respect of the dwelling-house cease when he gives up possession of it or does it continue until, additionally, his former landlord is notified that he is no longer in possession of it?
Such is the primary question raised by this appeal. On 11 June 2007 the appeal came before Mr Justice Tugendhat sitting in the High Court, Queen's Bench Division, and, pursuant to Rule 52.14(1)(a) of the Civil Procedure Rules, he ordered it to be transferred to this court on the basis that it raised an important point of principle.
The Appellant (“Mr Jones”) was a tenant of a one bedroom flat in Mitcham under a secure tenancy within Part IV of the Housing Act 1985 (“the Act”). The Respondents, the Mayor and Burgesses of the London Borough of Merton (“Merton”), were his landlords. On 11 February 2005, by virtue of an order for possession made against him on 14 January 2005, he became a tolerated trespasser in the flat. On 21 December 2006 in the Croydon County Court His Honour Judge Ellis ordered Mr Jones to pay to Merton £3,200.77 by way of mesne profits referable to the flat for the period from 3 October 2005 to 25 September 2006. Mr Jones appeals against the order. Mr Latham, who appears for Mr Jones but did not to do so before the judge, submits that he gave up possession of the flat before, or at any rate no later than, 3 October 2005 and so was not liable to pay mesne profits in respect of any part of the period thereafter. Mr Sefton-Smith, who appears for Merton but, likewise, did not do so before the judge, submits, by contrast, that, even if (which he disputes) Mr Jones gave up possession of the flat by 3 October 2005, Merton were not notified that he had done so until a much later date, say 3 July 2006. The liability of Mr Jones, as a tolerated trespasser, to pay mesne profits continued, says Mr Sefton-Smith, until Merton were notified that he had given up possession; and so Mr Sefton-Smith defends the judge's award in respect of the period at least until 3 July 2006, even if not until 25 September 2006. Mr Latham replies that, even if (which he disputes) the liability of Mr Jones to pay mesne profits extended until Merton were notified that he had given up possession, he had so notified them by 3 October 2005 and thus that, even were Mr Sefton-Smith's submission valid in law, the appeal should nevertheless succeed. It follows that, in addition to the issue of law, we have to address the issue of fact as to when Mr Jones gave up possession and, subject to the issue of law, as to when Merton were notified that he had done so.
Unfortunately counsel who represented Merton before the judge made what Mr Sefton-Smith accepts to have been an entirely erroneous submission of law; and even more unfortunately, notwithstanding that it was the subject of energetic challenge on the part of counsel who then represented Mr Jones, the judge upheld it. The submission was that the principles by which a tenant effects the surrender of his tenancy also govern the circumstances in which a tolerated trespasser secures discharge of his obligation to pay mesne profits to his former landlord. In that the surrender of a tenancy requires an unequivocal acceptance on the part of the landlord that the tenancy should end, and in that at no material time had Merton accepted that the liability of Mr Jones to pay mesne profits should end, the judge's erroneous premise led him without difficulty to conclude that the liability of Mr Jones had continued until the date at which Merton chose to end the calculation of their claim, namely 25 September 2006. Although in his judgment the judge usefully addressed matters relevant to the factual issues of possession and notification which are raised before us, such issues were not the subject of his direct focus because his enquiry took the wrong course.
The phrase “a tolerated trespasser” was famously introduced by Lord Browne-Wilkinson in the House of Lords in Burrows v. Brent LBC [1996] 1 WLR 1448 at 1455D in order to describe a former secure tenant under Part IV of the Act of 1985 who, as a result of the conjunction of s.82(2) and s.85(2) and (4) of that Act, is in what, at 1454H, Lord Browne-Wilkinson described as “limbo”.
Section 82(2) of the Act of 1985 provides as follows:
“(2) Where the landlord obtains an order for the possession of the dwelling-house, the tenancy ends on the date on which the tenant is to give up possession in pursuance of the order.”
By providing that the tenancy ends on the date on which the tenant is to give up possession rather than on the date on which he does so, the subsection has caused profound difficulties, to which the courts have sought to respond by giving birth to the tolerated trespasser. But his likely expectation of life seems now to be short: by s.298 of, and para.2(3) of Schedule 10 to, the Housing and Regeneration Bill, currently before Parliament, the government proposes to substitute for s.82(2) a provision which – it seems – would sweep the difficulties away.
In its present form section 85(2)(3) and (4) provides as follows:
“(2) On the making of an order for possession of such a dwelling-house … or at any time before the execution of the order, the court may –
(a) stay or suspend the execution of the order, or
(b) postpone the date of possession,
for such period or periods as the court thinks fit.
(3) On such [a] stay, suspension or postponement the court –
(a) shall impose conditions with respect to the payment by the tenant of arrears of rent (if any) and rent or payments in respect of occupation after the termination of the tenancy (mesne profits), unless it considers that to do so would cause exceptional hardship to the tenant or would otherwise be unreasonable, and
(b) may impose such other conditions as it thinks fit.
(4) If the conditions are complied with, the court may, if it thinks fit, discharge or rescind the order for possession.”
The effect of the conjunction of the subsections is therefore that, although a tenancy will have ended on the date on which the tenant is to give possession pursuant to any order for possession, it can be revived at any time before execution of the order, whether
(a) by an order for postponement of the date of possession under s.85(2)(b); or
(b) by an order for discharge or rescission of the order for possession under s.85(4) following compliance with any conditions of its stay or suspension imposed under s.85(3)(a).
In the event that the tenancy is thus revived, the revival is retrospective, with the result that the landlord and tenant are required to comply with such of their obligations under the tenancy agreement as arose even during the period of limbo: Lambeth LBC v. Rogers (2000) 32 HLR 361.
A tolerated trespasser is a former secure tenant against whom an order for possession has been made in which the specified date for him to give possession has passed but which has not been executed. So he has a valuable right potentially to secure the revival of his tenancy. He can be tolerated in any of three different senses. He can be actively tolerated by the former landlord who enters into an agreement with him not to seek to enforce the order for possession in the event that he complies with specified terms, in particular for payment of mesne profits and by way of reduction of arrears of rent: such were the facts in Burrows, cited above, (see 1450E-F). Or he can be passively tolerated by the former landlord who simply neglects to take steps to enforce the order for possession: such, as I will explain, are the facts of the present case. Or he can be tolerated not by the former landlord but by the court which, contrary to the submissions of the former landlord, stays or suspends execution of the order, usually upon conditions imposed by it pursuant to s.85(3)(a).
The Housing Law Practitioners Association estimates that there are as many as 750,000 tolerated trespassers in public sector housing in England and Wales; indeed a recent survey suggests that in inner London between 10% and 20% of occupants of local authority housing are tolerated trespassers rather than tenants. It seems that, because of the chance that tolerated trespassers will secure a revival of their tenancies, many owners of public sector housing stock, however unwisely, omit to distinguish between their tenants and their tolerated trespassers. The present is a case in point: for between about August 2005 and November 2006 Merton, although apparently mindful of the fact that they had obtained an order for possession against Mr Jones, were clearly unaware that he was no longer a tenant. They treated him as a tenant and told him that he was a tenant and had the obligations of a tenant. Mr Sefton-Smith concedes that ordinary trespassers on...
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