Supreme Court to rule on illegal eviction damages

The Supreme Court will give judgment next Wednesday in a dispute over an illegally evicted tenant’s entitlement to damages. Lord Neuberger, Lord Wilson, Lord Sumption, Lord Carnwath and Lord Toulson will rule on 3 December in Harry Loveridge’s appeal against a Court of Appeal decision that stripped him of more than £90,000 damages after his landlord, the London borough of Lambeth, repossessed and relet his flat while he was on an extended visit to Ghana. Loveridge sought compensation for the loss of his home at 19 Moresby Walk, London SW8, and was initially successful at Lambeth County Court, where he was awarded both statutory damages of £90,500 under the 1988 Act and common law damages of £16,400. The landlord successfully appealed the statutory damages award. Now the Supreme Court is to rule on the application of section 28 of the Housing Act 1988, which defines the measure of the statutory damages as the difference in value at the time immediately before the occupier was evicted and the value of the whole of the premises without the occupier – effectively the profit made by the landlord through unlawful eviction. The Law Lords are to decide whether the Court of Appeal was wrong to hold that any hypothetical step a landlord could take to affect a tenant’s security of tenure, but which had not actually been taken, was relevant to determining the value of the landlord’s interest immediately before an unlawful eviction. They will also rule on whether the Court of Appeal was wrong to hold that a prospective change in an occupier’s rights of occupation, following an actual sale, is relevant to a calculation of s.28(1)(a) damages. The valuation exercise is to be based on the assumption that the landlord is selling on the open market, but the parties have different stances on what that involves. The landlord’s valuer advised that if the property was valued on the open market prior to the eviction it would be sold subject to the tenant’s occupation rights. As a secure tenant becomes an assured tenant if the property were sold to a private landlord, the council claimed that the existence of the tenancy would have had no effect on the price. However, the valuer advising Mr Loveridge argued that on the hypothetical sale he would remain a secure tenant and that this would reduce the value of the building by £90,500. In May 2013, the Court of Appeal preferred the council’s analysis and found that the likelihood of the property being purchased by a private landlord should be taken into account. As a result of such a sale, the tenant would become an assured tenant and statutory damages were nil. Though Mr Loveridge ‘s tenancy agreement required him to notify his landlord of any absence from the property for more than eight, he failed to do so when in July 2009 he left the property for a lengthy visit to Ghana, and did not return until December 2009. Though he continued to pay his rent by standing order, a concern that Mr Loveridge might have died in the property led the council to effect forcible entry in September 2009. It then cleared out Mr  Loveridge’s possessions, prepared the property for reletting, and found a replacement occupant prepared to take an introductory tenancy of it on 4 December, one day before Mr Loveridge’s return. Mayor and Burgesses of the London Borough of Lambeth v Loveridge Supreme Court