Manaton v Edwards and another

Rent Act 1977, Schedule 15, Case 9 — Issue as to ‘greater hardship’ — Appeal from decision of county court judge in favour of tenant — Hardship on both sides — Onus of establishing greater hardship on tenant — Plaintiff landlord was a ship’s cook, but at date of hearing he was unemployed — He had married a Russian lady who was about to come to the United Kingdom and in fact arrived from Odessa shortly after the county court hearing — He had been living by himself in a caravan but wished to claim his house in order to set up a permanent home with his wife — Since the hearing matters had become somewhat worse — Plaintiff had obtained another temporary job at sea and his wife in his absence had lived in unhappy conditions in the caravan for a time before taking temporary employment in London — The tenant lived in the plaintiff’s house with a lady to whom he was not married (who was joined as the second defendant) and their six-month-old daughter — The tenant had also another daughter aged 15 by a previous marriage who came to stay with the couple at weekends — Their joint income was small and they said that they could find nowhere else to live — They had, however, approached the local district council, who had said that if a dispossession order were made against them they would be homeless for the purposes of the Housing (Homeless Persons) Act 1977 — Under section 2(1) of that Act they would be adjudged to have a priority need for accommodation because of the six-month-old daughter — It was admitted at the hearing that the plaintiff landlord reasonably required the house for his own occupation, so that the issue was purely one of greater hardship — The recorder in the county court said that ‘it is not for the court to assume other than that something of a bed-and-breakfast accommodation would be made available in the first place’ — Held that the recorder was in error in two respects — He had misdirected himself as to the burden of proof, which has to be placed on the defendant, but which he seemed to have put the wrong way round — Second, he dealt with the tenant’s position on a purely temporary basis, not looking at the longer-term effect — Appeal allowed and possession order made This was an appeal by the landlord, David John Manaton, from a decision of Mr Recorder Miller at Penzance County Court refusing to make an order for possession in favour of the landlord of a house at 5 Treneglos Terrace, Newlyn, Cornwall. The defendants, present respondents, were the tenant, Michael Colin David Edwards, and Miss Sandra Barnes, who lived with him in the house. Mark Whitehall (instructed by Robbins Olivey & Blake Lapthorn, agents for Boase Bennetts & James, of Penzance) appeared on behalf of the appellant; Miss Claudia Ackner (instructed by Cornish & Birtill, of Penzance) represented the respondents. Giving the first judgment at the invitation of Parker LJ, CROOM-JOHNSON LJ said: This is an appeal from the Penzance County Court against the refusal of the learned recorder to make an order for possession of a terraced house called 5 Treneglos Terrace, Newlyn. The order was made on May 21 1985. The plaintiff is the landlord, and the tenant, Mr Edwards, has been there for about nine years. By leave, Sandra Barnes was added as a defendant because she has been living there with Mr Edwards for a number of years. The decision turned purely on the question of greater hardship under Case 9 in Schedule 15 to the Rent Act 1977. The house is a three-bedroomed house and was let to the tenant at a rent of £13.50 a week in 1976. The plaintiff had purchased it in 1974. Miss Barnes joined Mr Edwards in 1979. They have been living together and now have a six-month-old daughter. The plaintiff is a ship’s cook. At the time of the hearing he had been at sea, while so employed, for about 75% of the time. He said that when he first let to Mr Edwards there was mention that he would need the house for his own possession at some time. Mr Edwards certainly heard him say that, but did not commit himself. For a long time, when the plaintiff was not at sea, he could live with his elderly parents, who were aged 72 and 62 at the date of the hearing. They had a boxroom which he could use. He began possession proceedings in 1981, but failed because he had no grounds. By 1985 the circumstances had changed. The plaintiff’s ship had been the SS Uganda and had been scrapped. The plaintiff was made redundant, and he was under contract to the Shipping Federation but was at the time of the hearing unemployed. In November 1983 he married a Russian lady. At the time of the hearing in 1985 she was about to come to the United Kingdom from Odessa and was due to arrive on May 30, very shortly after the county court hearing. The plaintiff’s case was that he wanted to claim his house; he wanted a permanent home where he could set himself up with his wife, and they would want to start a family; he could not afford to take any other house, and at that time he was living by himself in a caravan. The letting for the caravan was due to expire on June 26 1985, and he did not expect that there would be a renewal of that licence because the holiday season was about to begin and he expected that the owner of the caravan would want a more remunerative summer let for holidaymakers. That was the plaintiff’s position at the time of the hearing. His position has changed since then, and it is right that I should briefly touch upon it. His wife did arrive very soon after the county court hearing when the order for possession was refused. They were together for a short time. The plaintiff then got another job which took him away to sea, which finished, as it turns out, yesterday. His wife, finding herself in the caravan in a strange country, was very unhappy. The caravan had been kept on after June 26 on the basis of a bare licence, for which they are paying £25 a week to the caravan owner. Finding herself there with no proper home, her husband away at sea, the plaintiff’s wife got herself a job in London in a hotel on what is accepted to be a temporary basis. At present she is abroad again on holiday, but that is accepted as being only temporary. So the present position is that the plaintiff is still where he was at the date of the hearing. Having finished at sea, he is now on a month’s leave, after which he will be unemployed and he will be in receipt of £15 a week as a retainer from the Shipping Federation provided he is prepared to offer himself for further employment. The wife, when he is here, can go back to the caravan with him. When he is not here, she would not want to go back to the caravan, one assumes, by herself. The situation is extremely uncertain, and the inference could perhaps fairly be drawn that, in so far as there has been a change of circumstances for the plaintiff since the hearing at the county court, it has been for the worse because, as a result of no order having been made, his family life has become disrupted. That is the position of the plaintiff. The defendant at the hearing before the recorder at Penzance conceded that the plaintiff’s claim was a reasonable one — he reasonably required the house for his own occupation — but claimed that, if an order were made, there would be greater hardship to him than there would be to the plaintiff if no order were made. The onus of proving the greater hardship is, of course, on the defendant. The defendant is a welder. His net take-home pay, we have been told, is £81 a week. Miss Barnes has some unemployment benefit and possibly some child allowance for the six-month-old daughter. The evidence originally stated that her own income, in addition to that of Mr Edwards, was £100 a week, which would have given the family a joint income of £181 a week, but we have been told that that was a misunderstanding and in fact their joint income is £100 a week. The defendants say that their parents, who do have each a spare room, cannot rehouse them or their children. They have another child whom they have to accommodate from time to time, a daughter aged 15 of Mr Edwards by a previous marriage who comes at weekends for staying access. They said that they could not find anywhere else to live. What they did was to go to the Penwith District Council, and they produced a letter to show what the council held out to them as being open to them if an order were made. It is a letter dated May 10 1985, which was written by the chief housing and technical officer to the160 defendants’ solicitors, and it is really a very bare statement of the legal position. It says: Should a Court Order for Possession be granted against Mr Edwards, it would be open to him to apply to the Council under the provisions of the Housing (Homeless Persons) Act. In cases where families are homeless through no fault of their own, then the Council accept liability for rehousing although the actual area within the Penwith district would depend upon suitable vacancies. If the case goes against Mr Edwards, it would be helpful if you could forward me a copy of the Court Order, together with the Particulars of Claim. Therefore it has to be conceded that, if a court order were made against the defendants, they would be homeless for the purposes of the Housing (Homeless Persons) Act 1977. In addition to that, in accordance with section 2(1) of that Act, they would be adjudged to have a priority need for accommodation because of the existence of the little girl, Natalie, their six-month-old daughter. When the learned recorder gave his judgment he set out all the facts as they then existed and came to the question where he had to discuss the issue of whether the defendants had succeeded in proving greater hardship. What he said was this, after reciting the family circumstances: He produces from Penwith District Council a letter dated May 20 1985 which whilst conveying the concept that they would be treated as homeless, it gives no indication of the property that they would be given or when they would be re-housed. There is no guarantee of the nature or of the area or of the accommodation to be provided and it is not for the Court to assume other than that something of a bed-and-breakfast accommodation would be made available in the first place. The Court has to decide on the facts at this moment which includes the Statement of Penwith District Council but that is not very helpful in carrying the case further. Then, after dealing with the burden of proof, he said: I have every sympathy with the landlord but one cannot turn a blind eye to greater hardship. He has not made out that it would cause any great hardship on his part if I refuse his application. Mr Edwards does make out the greater hardship and therefore exercising all matters within the Act reluctantly this claim must be refused. This is a familiar situation where the plaintiff has prudently made provision for himself, he wants his house, and it is conceded that he needs it. It has also been said that the defendants have been good tenants of the house for the period that they have been there. When one comes to consider the issue of greater hardship, this court cannot merely upset the decision of the county court judge or recorder simply because it might have come to a different conclusion itself. That has been long established and laid down very clearly in King v Taylor [1955] 1 QB 150, which also says that it is relevant to take into account changes in circumstances which have taken place since the hearing. But the point is taken in the present case that the learned recorder misdirected himself when he came to his conclusion that the defendant had proved the greater hardship. The position under the Housing (Homeless Persons) Act 1977 is that the council, first of all, have to be satisfied that the defendants are homeless. If the court made the order, they could not fail to be satisfied of that. They would then be satisfied that there was a priority need for the defendants to have accommodation. With the existence of the little daughter, they could not fail to be satisfied of that. They then have to apply the tests which are laid down in section 4; and under section 4(5), in various circumstances, it is the council’s duty to secure that accommodation becomes available for their occupation. Some initial hardship is obviously caused in a way every time a possession order is made against a sitting tenant, but it has to be more than merely that. The landlord has to begin by satisfying the court that he has a reasonable need for the house. That has been conceded as having happened here. The learned recorder, when he came to consider this, seems to have approached it on the basis that the defendants have nowhere else to go. He said: ‘. . . it is not for the court to assume other than that something of a bed-and-breakfast accommodation would be made available in the first place.’  That is not something which figured in the only evidence which was adduced independently by the defendants, which was the letter from the Penwith District Council. It may be that, assuming an order were made against the defendants, they would have to begin with bed-and-breakfast accommodation, but it was certainly for the defendants to provide evidence that the accommodation, which it was the legal obligation for the Penwith District Council to provide for them, would be something which would be unsatisfactory and something which would cause greater hardship to them; and that seems not to have been provided at all. In coming to the conclusion in the way he did, the learned recorder seems to have done two things. First of all, when he said, ‘It is not for the court to assume other than that something of a bed-and-breakfast accommodation would be made available in the first place’, he does not seem to have been applying the burden of proof which has to be placed upon the defendant. If anything, he seems to have been putting it the wrong way round. In the second place, the recorder should not have been dealing with the matter on a purely temporary basis. The immediate effect of an order for possession always is to dispossess a tenant and to cause him some initial hardship of a sort. What the recorder should have been looking at is the longer-term effect of the order to see whether it had been proved that the accommodation which the council is legally bound to provide would be something which would be unsuitable and would cause hardship, or greater hardship, to the defendants. That he does not seem to have considered at all. Having approached the case in the way he did, what he has done is to misdirect himself as to the way in which the burden of proof should be discharged by the defendant in circumstances such as these. There is unquestioned hardship to the plaintiff, who is wanting to get back into his own house in the circumstances which he outlined to the court and which still, apparently, exist today. But there does not seem to have been any proper evidence given to justify the finding by the learned recorder that there would be greater hardship caused to the defendants if he made the order against them. Accordingly, in my view, he misdirected himself as to the issue which he had to decide. In those circumstances, the defendants not having really proved hardship of any kind, let alone greater hardship, the order for possession should have been made, as it was conceded, as it had to be, that the landlord properly required the house for his own occupation. I would accordingly allow this appeal and order that the plaintiff should have possession of the house on the basis that the defendant has not discharged his burden of proof and that the learned recorder has misdirected himself in the conclusion to which he came. Agreeing, PARKER LJ said: In the light of the letter from the Penwith council, the position which would result from granting the order, which is a matter which has to be considered, is that the tenants would not be without other accommodation. The council would be under a positive obligation to afford other accommodation. That accommodation might be preferable to the accommodation the subject-matter of the claim for possession. It might be in a preferred area at a more favourable rent, and so on. The burden being on the tenant to show that the making of the order would cause greater hardship on him than its refusal would upon the landlord, it follows that if he does not make further inquiries and tender evidence as to the likely result when the order has been made and can say only ‘I will be housed’, then, in the absence of any special circumstances, and I can see that none exist here, he has failed to discharge the burden of proof upon him. The learned recorder, as my lord has pointed out, appears to have got the matter the wrong way round. When he says that it is not for the court to assume other than that something of a bed-and-breakfast accommodation would be made available in the first place, the implication is that he was looking for someone to establish that what would be made available would be better than bed-and-breakfast accommodation; and that is putting the burden the wrong way round. Second, to proceed on the basis that what matters is only the immediate result of the making of an order rather than its longer-term effect is, in my judgment, a plain error of law. It has been said clearly that this court will only interfere on a question of greater hardship in exceptional circumstances. Nothing that I say in this case, or that my lord has said, should be taken to indicate that this court will now interfere other than in exceptional circumstances, but when that matter was dealt with in King v Taylor, to which reference has been made, Lord Evershed MR cited the judgment of Lord Greene in Coplans v King [1947] 2 All ER 393, and in that judgment Lord Greene made it clear that if the county court judge proceeded on a mistaken basis of law, it would be proper for the court to interfere. So far as the subsequent events are concerned, they certainly have not weakened the landlord’s claim to possession and may indeed have strengthened it. But even as at the time when the order was made, the learned recorder was not in my view justified in concluding that the tenant had satisfied the burden of proof upon him. Accordingly I would allow the appeal and make an order for possession. The only matter remaining for consideration, upon161 which we will hear counsel, is within what period that order should take effect. I have in mind certainly 28 days. It may be that more is sought and, if so, we will entertain submissions on the matter.