Assured tenancy – Landlord refusing rent tendered by housing benefits authority in name of cohabitee of tenant – Whether such refusal disabled landlord from invoking mandatory ground for possession- Appeal allowed
Part I of Schedule 2 to the Housing Act 1988 gives to the grantor of an assured tenancy, who has served a notice under section 8, a mandatory ground (ground 8) for possession where, if rent is payable monthly, at least three months’ rent (now two months) is unpaid at the dates of the notice and hearing.
On March 4 1996 the plaintiff let a house near Wakefield on a monthly assured tenancy to the defendant on terms allowing for direct payment by the council’s housing benefit department (HBD) of the monthly rent of £300, the plaintiff being aware that the unmarried defendant required the house for herself and her four children. The defendant covenanted, inter alia, not to share occupation of the property or any part thereof. On June 13 1996 the plaintiff served a section 8 notice claiming £900 arrears of rent, and on July 8 1996 commenced proceedings for possession founded primarily on ground 8. On August 19 1996 the HBD remitted £493.32 identified as housing benefit claimed by a Mr Gary Burnham. At a hearing on August 29 the plaintiff, having only just learned that the defendant and Burnham were cohabiting in the house, obtained an adjournment. On September 9 1996 the plaintiff returned the £493.32 to the HBD stating its unwillingness to accept rent from persons other than the defendant. By its reply dated September 11 1996 the HBD explained that the payment had been so made because Mr Burnham was claiming income support ‘for the family’, but it undertook to reissue the returned cheque in the name of the defendant. Despite that assurance the HBD sent a further remittance of £276.16 on September 16 1996, again in the name Gary Burnham and which was again returned by the plaintiff. On October 14 1996 the HBD remitted the sum of £769.48 in the name of the defendant as a replacement for the two earlier remittances. At a restored hearing on October 25 1996, where the plaintiff claimed arrears totalling £1,030.52, the judge disallowed the claim on the ground that the arrears would have been below the £900 minimum required under ground 8 if the plaintiff had not wrongfully rejected the moneys tendered in August and September, thus rendering himself ‘the architect of his own misfortune’. On appeal by the plaintiff, the defendant conceded that the first tender of £493.32 had been rightly rejected, but maintained that the second tender of £276.16 was good as by that time the plaintiff knew that Mr Burnham was paying as agent of the defendant.
Held The appeal was allowed.
1. A landlord was entitled to reject a tender of rent from a stranger to the property unless that person was paying as agent for the tenant or for the tenant’s account: see Smith v Cox [1940] 2 KB 558. The fact that the HBD was empowered to make the payment in the manner complained of did not make Mr Burnham the defendant’s agent in her dealings with the plaintiff.
2. The plaintiff had not acted unreasonably since acceptance of the moneys might constitute a waiver of the covenant against sharing occupation, with the consequent possibility of claims by Mr Burnham to rights under the tenancy whether as successor to the defendant or otherwise.
Russell Stone (instructed by Ingram Winter Green) appeared for the appellant; Joanne Harris (instructed by Emsleys, of Castleford) appeared for the respondent.
