Housing Act 1974, sections 71 and 71A, and Housing Act 1957, section 9(1A) — Application by freehold owners of a mansion block of flats, occupied by a mixture of long leaseholders and protected tenants, for judicial review, seeking an order of mandamus to require the local authority to make mandatory repair grants under sections 71 and 71A of the Housing Act 1974 — Mansion block in a bad state of repair; substantial works, particularly to common parts, required — The mandatory repair grants depended on the execution of works required by notice under section 9(1A) of the 1957 Act — Notices under section 9(1A) were served on the leaseholders in respect of their flats and on the freehold owners in respect of the flats occupied by the protected tenants — The question for the court was whether these notices were valid — The applicants’ argument was that a flat was part of a building within section 18 of the 1957 Act and the authority could take the same action in regard to it as to a house, so that it was a house within the meaning of the Act; also, the common parts could be regarded as its ‘appurtenances’ within section 189 — This argument was rejected by Hodgson J, who held that a flat in a block was not a ‘house’ and, in any case, common parts, such as the roof, could not be regarded as ‘appurtenances’ — It followed that the notices served under section 9(1A) on the leaseholders in respect of their flats and on the freeholders in respect of the flats occupied by the protected tenants were alike invalid — An argument that a local authority was estopped from challenging the validity of its own notices in the circumstances of this case was rejected — The notices could not therefore form the basis of a claim for grant under the 1974 Act — The effect of this decision together with that of the House of Lords in the case of Pollway Nominees Ltd v London Borough of Croydon might make it impossible for a local authority to exercise control under Part II of the Housing Act 1957 over the external and common parts of a block of self-contained flats — If this was an unintended lacuna it was a matter for the legislature to consider — Application for judicial review dismissed
The following
cases are referred to in this report.
Critchell v Lambeth London Borough [1957] 2 QB 535; [1957] 3 WLR 108;
[1957] 2 All ER 417, CA
Lever
Finance Ltd v Westminster (City) London Borough
Council [1971] 1 QB 222; [1970] 3 WLR 732; [1970] 2 All ER 496; (1970) 21
P&CR 778, CA
Pollway
Nominees Ltd v Croydon London Borough [1986]
2 EGLR 27; (1986) 280 EG 87, HL
R v Inland Revenue Commissioners, ex p Preston [1985] AC 835;
[1985] 2 WLR 836; [1985] 2 All ER 327, HL
Western
Fish Products Ltd v Penwith District Council
[1981] 2 All ER 204; (1978) 38 P&CR 7; 77 LGR 185, CA
In this case
Clayhope Properties Ltd, the freehold owners of the block of flats known as
Dover Mansions, Canterbury Crescent, London SW9, applied for judicial review,
seeking an order of mandamus directed to Lambeth Borough Council, requiring the
council to make mandatory grants for repairs to the block under the Housing Act
1974 as amended.
John Colyer QC
and Roger Cooke (instructed by Bernstein & Co) appeared on behalf of the
applicants; Andrew Arden (instructed by R G Broomfield, chief solicitor,
Lambeth Borough Council) represented the respondent council.
Giving
judgment, HODGSON J said: In this case the applicant company seeks judicial
review by way of mandamus directed to the respondent council requiring the
council to make mandatory repair grants pursuant to sections 71 and 71A of the Housing
Act 1974.
The case
concerns a mansion block of 20 flats known as Dover Mansions. The applicant is
the freehold owner of the block. Fourteen of the flats are let on 99-year
leases with small ground rents; the remaining six are let on short-term protected
tenancies. The block has two entrances, one to Flats 1-10, another to Flats
11-20. The block has one common roof and there are, of course, common parts
including passages and staircases enjoyed by the occupants of all the flats. I
refer to the two classes of flat as leasehold flats and tenanted flats.
So far as the
leasehold flats are concerned, I have been shown a copy of the lease of no 1,
which I assume to be in common form with the other 13. The lease provides for
the demise of:
All that
ground floor flat being on the ground floor of the Mansion including as
appropriate one half in depth of the joists between the ceiling of the flat and
the floor of the flat above it and the internal and external walls between the
flat and any adjoining flats the situation whereof is shown on the plan annexed
hereto . . .
The lessor
covenants:
That (subject
to contribution and payments as hereinbefore provided) the Lessors will
maintain repair and renew: (a) the main structure and in particular the roof
foundations chimney stacks gutters and rainwater pipes of the Mansion (b) the
gas and water pipes sewers drains and electric cables and wires in under and
upon the Mansion and enjoyed or used by the Lessees in common with the owners
and lessees of the other flats (c) the forecourt main entrance passages and
right of way of the Mansion so enjoyed or used by the Lessees in common as
aforesaid and (d) the boundary walls and fences of the Mansion.
Towards the
cost of these works each long leaseholder undertakes to contribute one
twentieth, but, of course, from the protected tenants the landlord can recover
nothing.
The block is
in disrepair, and substantial work of repair, particularly to the common parts,
is urgently needed.
Under the
provisions of section 71 and 71A of the Housing Act 1974 (71A being added by
the Housing Act 1980) it is provided: ‘In so far as an application for a
repairs grant relates to the execution of works required by a notice under
section 9 of the Housing Act 1957’ the award of a grant is mandatory. Section
9(1A) was added to the 1957 Act by section 72 of the Housing Act 1969. It
provides, so far as relevant:
Where a local
authority . . . are satisfied that a house is in such a state of disrepair
that, although it is not unfit for human habitation, substantial repairs are
required to bring it up to a reasonable standard, having regard to its age,
character and locality, they may serve upon the person having control of the
house a notice requiring him, within such reasonable time, not being less than
twenty-one days, as may be specified in the notice, to execute the works
specified in the notice, not being works of internal decorative repair.
In 1981 the
council served a notice purportedly under section 9(1A). It was served on the
applicant and required works to be done to Dover Mansions as a whole, including
work to individual flats. As Mr George [solicitor of Lambeth Borough Council]
put it in his affidavit, this ‘in substance represented the view that Dover
Mansions could be treated as ‘a house’ for the purposes of Part II of the 1957
Act’. The 1957 Act gives a right of appeal against notices to the county court.
Against the 1981 notice the applicant exercised this right, but the appeal was
never heard and has been overtaken by events.
In 1982, in
the course of negotiations, the applicant says that the council indicated that
it would give grants for the work comprised in the notices, and an application
for a grant was made in 1983, but that also has been overtaken by events.
Also in 1983
the leasehold tenants began an action against the applicant for specific
performance of the landlord’s repairing covenants and for damages. In that
action a receiver and manager of Dover Mansions has been appointed to receive
the rents and profits and to manage the block and receive grants. The action
itself stands adjourned.
The immediate
events out of which this litigation arises began in the spring of 1984. By then
the legal advice given to the council had changed and they were advised that
Dover Mansions as a whole could not be treated as ‘a house’. Also,
deterioration since 1981 had occurred, which meant that the original schedule
of works would no longer be sufficient. A further factor was that the tariff
rate for mandatory grants was to be lowered in respect of applications
submitted after March 31 1984. (It is one of the peculiarities of this case
that the parties have a common aim in that all are anxious that as much money
as possible should be made available; this is a less generous attitude on the
part of the council than appears on the surface as the grants are funded wholly
or largely from central government funds.)
The council
were now advised that the way in which notices should be served was this. In
respect of the leasehold flats the leaseholder should be served; in respect of
the tenanted flats the applicant.
Accordingly,
by a letter dated March 20 1984 addressed to one of the leaseholders and copied
to the others, the council set out in great detail the steps it proposed to
take and the reasons for doing so. It is unnecessary to cite in detail the
contents of that letter; it made clear that the council were going to proceed
on the basis that the mansion block as a whole could not be classed as a house
as it ‘comprises a number of self-contained purpose-built dwellings’ but that
each flat was itself ‘classed as ‘a house’ within the meaning of’ the (1957)
Act, and that in respect of each such ‘house’ a notice would be served on the
‘person having control’. The council further intimated in that letter that, as
a ‘house’ by section 189 of the 1957 Act includes ‘appurtenances’ the ‘main
structure, common parts and roof can therefore be deemed to be appurtenances’.
Acting on
behalf of the residents’ association, solicitors replied to this letter on
March 22 1984 contending in strong terms that:
To contend
that service (of the notices) must be effected on the lessees themselves, is
with the greatest of respect, nonsense. The lessees have absolutely no
authority or power to do works to the external/common parts as you suggest.
However,
acting on the legal advice they then had, the council served 20 notices on
March 23 1984. In respect of the leasehold flats the notice in respect of Flat
1 is typical. It reads, so far as relevant:
To (the name
of the tenant) . . . being the person having control of the house known as Flat
1, Dover Mansions, Canterbury Crescent, SW9. TAKE NOTICE that — (1) the LONDON
BOROUGH OF LAMBETH are satisfied that the above-mentioned house is in such state
of disrepair that, although it is not unfit for human habitation, substantial
repairs are required to bring it up to a reasonable standard, having regard to
its age, character and locality; and (2) in pursuance of section 9(1A) of the
Housing Act 1957, the Council require you within a period of Forty two (42)
days ending on the 4th (FOURTH) day of May, 1984, to execute the following
works, not being works of internal decorative repair, namely SEE ATTACHED
SPECIFICATION.
The notice
goes on:
The attached
schedule is divided into two parts as follows: Part A — Internal works of
repair in connection with the specified flat. Part B — External works of repair
to the whole block and internal works to the shared common parts.
Each
recipient of this notice is responsible for all the works specified in Part A
and one twentieth of the cost of the works in Part B of the schedule.
In respect of
the phrase ‘person having control’ the recipient was referred to section 39(2)
of the Act.
So far as Part
B was concerned, each notice specified the whole of the work required so that
each recipient was required, for example, ‘to examine all chimney pots and
remove broken, cracked, rusted or otherwise defective pots’.
The notices in
respect of the tenanted flats were served on the applicant. Each was in the
same terms as the 14 notices to leaseholders and each required the applicant to
be ‘responsible’ for one twentieth of the cost of the external and common part
works.
Despite the
solicitors’ response of March 24 fresh applications for grants were already
being prepared. The applicant, the receiver and all the tenants co-operated in
making the grant applications; each was made in the name of the tenant,
countersigned by the applicant. They in fact predate the notices: they were
sent by the receiver to the council on March 30 1984 together with other
documents and information about tenders which had been received for doing the
work. In a letter dated April 16 1984 the council appeared to be accepting the
validity of the grant applications.
As well as
making the grant applications (or rather countersigning them) the applicant
gave notice of appeal to the county court against them. The grounds of appeal
are set out in the affidavit of Mr Allen [of Bernstein & Co, applicant’s
solicitors]: grounds (b) and (c) have since been abandoned and, if the relief
sought in these proceedings is granted, the appeals will be withdrawn.
But the
respondents, perhaps because of a circular from the Department of the
Environment, which I have not been shown, took fresh legal advice. As a result
of that advice they have made no determination on the grant applications and no
grants have been paid.
On October 17
1984 the council wrote to the receiver:
Dear Sir Re:
Dover Mansions, Canterbury Crescent
I write
further to our recent telephone conversation regarding grants.
As explained,
current legal opinion is that we are not able to grant aid works to common
parts and areas of shared responsibility.
The whole
issue of dealing with Mansion Blocks highlights a number of deficiencies in the
current housing law relating to purpose-built flats and maisonettes.
Our legal
department is currently seeking a further counsel’s opinion but until this has
been received I have been advised by the Housing Directorate that they will not
be approving any further grants where there is an element of shared works.
Clearly this
means everything has ground to a halt at the moment until the grant situation
has been resolved. I shall keep you informed of any developments at the first
opportunity.
On December 10
1985 the council wrote again to the receiver and to all the tenants:
I must inform
you that the above Notices served on you . . . are hereby withdrawn in line
with the legal advice received by this Council.
The
withdrawal of the Notice(s) is without prejudice to the fact that the Notice(s)
shall stand if the Court so rules in the action for judicial review between
Clayhope Properties and the Council.
As these
Notice(s) have been withdrawn (subject to the Court’s decision as stated above)
the grant application(s) received cannot be treated as mandatory and must be
treated as application(s) for discretionary grants. The Council regrets that
there is no funding presently available for the payment of discretionary grants
and the grant applications as such extend beyond admissible works.
Should there
be any further developments I shall be contacting you further.
The respondent
now accepts that this letter can be ignored. The notices stand until and if
they are declared to be invalid.
The question
which I have to decide (subject to an argument based on estoppel) is whether
the notices purportedly served under section 9(1A) of the 1957 Act were valid
notices.
During the
course of argument I was told that the case of Pollway Nominees Ltd v London
Borough of Croydon was about to be argued in the House of Lords. As that
case concerned the application of section 9(1A) to a purpose-built block of flats
(although a solution of the problem was differently attempted in that case) I
thought it right to defer giving judgment in this case until I had had an
opportunity of considering the speeches in Pollway. They were made on
July 17 1986 and I have now had the opportunity of seeing them.1
1Editor’s note: See [1986] 2 EGLR 27; (1986) 280 EG 87 for House of
Lords report.
What early
becomes apparent when one considers the statutory provisions in Part II of the
Housing Act 1957 is that they were plainly not framed to cope with the
situation where there is a purpose-built block of flats.
The compulsory
powers of local authorities contained in Part II of the 1957 Act as amended
have their origin in Part II of the Housing
the repair, maintenance and sanitary condition of houses’, and the Act required
the person having control to effect repairs to a house which was unfit for
human habitation and which was ‘occupied or of a type suitable for occupation
by persons of the working classes’. It was also provided by section 20 that the
‘like proceedings’ could be taken ‘in relation to any part of a building which
is let for human habitation as a separate tenement’ save that in relation to
part of a building a demolition order could not be made, only a closing order.
The heading to section 20 was ‘Power of local authority to deal with part of a
building’.
In the 1957
Act the heading to the fasciculus of sections in Part II remained the same, but
the reference to the working classes was omitted and the powers widened to
include ‘any house’. And, in 1969, the power was extended to cases where,
although fit for human habitation, substantial repairs are required to bring it
up to a reasonable standard, having regard to its age, character and locality.
The 1957 Act
in section 18 makes similar provisions as to part of a building as were
contained in section 20 of the 1930 Act, but some indication of the draftsman’s
lack of concern with purpose-built flats is perhaps shown by the substitution
of a new heading ‘Power to make a closing order as to part of a building’. As
Lord Bridge said in Pollway: ‘The truth, I suspect, is that generations
of parliamentary draftsmen have been content to use the time-honoured formula
without ever contemplating its application to the circumstances presently under
consideration.’2
2Editor’s note: See [1986] 2 EGLR 27 at p 29L; (1986) 280 EG 87 at p
91.
The argument
put forward by the applicant in this case is basically that which the
respondent was advancing in its long letter of March 20 1984. I hope I
summarise it accurately as follows. Section 9(1A) empowers a local authority,
in the circumstances set out and already recited, to ‘serve upon the person
having control of the house a notice’ requiring him to execute works. By
section 18 a local authority may take the like proceedings in relation to ‘any
part of a building which is used . . . as a dwelling’ as they are empowered to
take in relation to a house. A flat in a block is plainly part of a building
used as a dwelling; therefore a local authority can take proceedings under
section 9(1A) in relation to it.
So far, despite
the doubt raised by the restrictive heading to section 18, I do not think that
the respondent would be disposed to quarrel with the argument.
But the
argument has to proceed two steps further if the notices are to be valid
notices in respect of the outside and common parts. First, it is contended
that, because of section 18, a flat is a house within the meaning of the Act so
that the interpretation section 189 applies to it. That section provides that
‘house’ includes ‘(a) any yard, garden, outhouses, and appurtenances belonging
thereto or usually enjoyed therewith . . .’.
I have then to
be satisfied that all the outside and common parts are appurtenances to all the
flats.
The
respondents contend that these submissions fail in limine because a flat
in a block is not a ‘house’; it is only a part of a building. I agree. I can
find nothing in section 18 which would justify me in holding that a flat in a
block is a house for the purposes of Part II of the Act. If that had been
intended it could have been specifically provided. And, in this connection, it
is, in my judgment, importantly indicative of statutory intention that specific
provision is made under (b) relating to ‘house’ in section 189 that the word
includes ‘part of a building’ for the purposes of provisions in the Act
relating to the provision of housing accommodation; these provisions one finds
in Part V of the Act. See also Critchell v London Borough of Lambeth
[1957] 2 All ER 417 at p 420A per Lord Evershed MR: ‘In any case, in my
judgment, s9, s10 and s11 of the Act of 1936’ — sections 9, 10 and 16 of the
1957 Act — ‘use the word ‘house’, in their context, as meaning what is commonly
called a house — that is, a separate structure’.
If I am wrong
and a flat is a house and includes its appurtenances, are the common parts, the
roof etc all appurtenances of each flat?
I have heard lengthy argument in support of this proposition, but I am
bound to say that it would offend my sense of reality to find that the chimney
pots above Flats 1-10 were appurtenances of Flats 11-20.
As Mr Arden
points out, the whole basis of Part II of the Act is that the notice is served
on the ‘person having control’ as defined in section 39(2) of the Act. As Lord
Bridge pointed out in Pollway, the formula there used has a long
statutory history:
It has been
used in a wide variety of legislative contexts most commonly for the purpose of
identifying the person entitled to that interest in property upon whom
Parliament thought it appropriate to impose some obligation to undertake work
on or in connection with the property required in the public interest or to
meet a proportionate share of the cost of public works from which the property
would derive the benefit.3
3Editor’s note: See [1986] 2 EGLR 27 at p 28H; (1986) 280 EG 87 at p
88.
I find it
impossible to think that Parliament intended that the long leaseholder of a
flat should be an appropriate person on whom to impose an obligation in respect
of the roof of the block in the public interest.
In respect of
the notices served on the long leaseholders three other issues arise. The first
is whether these notices are severable so that they apply in so far as Part A
is concerned but not Part B. I do not think that they can be so severed for a
number of reasons. Notices have to tell the recipients what works they have to
carry out. The whole scheme depends upon this. But these notices require the
recipients in the main to carry out works on parts of the premises which they
do not ‘control’ either in the wide sense of having the power to do work or the
narrow sense defined in section 39. In my judgment, a notice which required a
recipient to do work which is the main part of the requirement and which the
local authority have no right in law to require him to do is as invalid and
void as is a notice served on the wrong recipient: see Pollway.
Even if this
court in theory has the power to sever these notices, there is no evidence
before the court as to whether or not the works required in Part A would
achieve the result required by section 9(1A) if the Part B work is not done. In
the light of this judgment it will be possible for the local authority, if it
wishes, to serve fresh notices in respect of work required to the flats
themselves which can then, if necessary, be appealed to the county court.
Second, it is
submitted that, because there is given to the recipient a right of appeal to
the county court, that is the route which should be taken. I think there is
nothing in that point. Here it is the local authority who is taking the point
that the notices were invalid and void, and it would be absurd to suggest that
it should do so by appealing to the county court in respect of its own notices.
Last, is the
local authority in some way estopped from challenging the validity of its own
notices? I do not think such an argument
could possibly succeed. Lever Finance Ltd v Westminster (City) London
Borough Council [1971] 1 QB 222 is relied on by the applicant, but that was
a case where the planning authority had the power to do that which the court
held it was not entitled to deny it had done. Here, in my judgment, the local
authority had no power under section 9(1A) to serve the notices at all. See Western
Fish Products Ltd v Penwith District Council [1981] 2 All ER 204. As
de Smith puts it (4th ed, p 104) ‘the general principle remains that a public
authority may not vary the scope of its statutory powers and duties as a result
of its own errors or the conduct of others’.4
4Editor’s note: Judicial Control of Administrative Action, by
S A de Smith.
I am aware
that in his speech in R v Inland Revenue Commissioners, ex p Preston
[1985] AC 835 Lord Scarman said that ‘judicial review should in principle be
available where the conduct of the commissioners in initiating such action
would have been equivalent, had they not been a public authority, to a breach
of contract or a breach of a representation giving rise to an estoppel’. But,
in this case, it does not seem to me that there are any grounds for holding
that, if not a public authority, the respondents could be estopped. The
applicant has in no way relied upon the notices; all it has done is appeal
against them and make an application for a grant. If works had actually been
commenced prior to the approval of the grant, the situation might have been
different for the reasons adumbrated in argument by Mr Arden.
In respect,
therefore, of the notices served upon the long leaseholders I find that they
were invalid and void and that they cannot therefore form the basis of a claim
for a grant under the 1974 legislation.
Is the
position any different in respect of the six notices served upon the applicant
itself as being the legal person falling in respect of those flats within
section 39(2)? I think not. The validity
of the requirement that work be done on the external and common parts still
depends, in respect of each flat, upon the arguments which I have held to be inadmissible
in respect of the long leases.
I am aware
that the effect of this judgment together with the decision of the House of
Lords in Pollway may make it impossible for a local authority to
exercise Part II control over the external and
fact that there is this lacuna in the local authority’s statutory powers
particularly surprising. The whole purpose of this and similar legislation is
to fix the responsibility for doing works upon the person who in fairness ought
to bear the burden. To achieve this over the years the legislature has used the
formula set out in section 39(2) of the 1957 Act. In Pollway Lord Bridge
showed how this formula has been repeated time and time again with but minor
variations of language. But in the context of a block of flats the formula does
not work in respect of, for example, the roof. In common parlance the person
who has ‘control’ of the roof is the applicant. It has the power, and indeed
the contractual obligation, to do the necessary repairs to the roof, but the
applicant, in respect of the roof, does not fall within the formula.
I do not
myself find this lacuna (if it be one) particularly surprising. In Pollway
Lord Bridge said this:5
I appreciate
that this conclusion may cause inconvenience for local authorities. But I
imagine that normally the contractual rights of the owners of long leasehold
interests in flats to enforce repairing obligations against their lessors will
provide an adequate solution of the problem. This may be the explanation of the
fact that, though the formula found in the definition has been in common use in
statutes since at least 1847, it was not until 1982 that its application to
buildings divided into units let on long leases had to be considered by the
courts. The truth, I suspect, is that generations of parliamentary draftsmen
have been content to use the time-honoured formula without ever contemplating
its application to the circumstances presently under consideration. That must
surely be true of section 39(2) of the Act of 1957, which simply re-enacts the
formula first used in its present context in section 17(4) of the Housing Act
1930. That Act introduced the compulsory procedure which we now see in expanded
and amended form in Part II of the Act of 1957 requiring ‘the person having
control of the house’ to effect repairs to a house which was unfit for human
habitation and which was ‘occupied or of a type suitable for occupation by
persons of the working classes.’ The draftsman
in 1930 can hardly be blamed if it did not occur to him to make suitable
provision for dealing with problems arising from flats let on long leases at
low rents.
5Editor’s note: See [1986] 2 EGLR 27 at p 29K; (1986) 280 EG 87 at p
91.
On the facts
of this case the contractual rights enjoyed by the tenants are capable of
providing, and will no doubt provide, an adequate solution to the problem at
which Part II of the 1957 Act is aimed.6 The misfortune is that, by limiting the grant
legislation to work performed under a section 9 notice, the legislature have
failed to provide for the making of grants in respect of the ‘outside’ work.
Whether that comes about by oversight or intention matters not. If it is an
unintentional lacuna it is for the legislature, if it wishes, to fill it; if it
is an intentional restriction of grant aid (and this cannot be excluded) then,
of course, while one may or may not think it fair, the court is in no way
concerned. The application therefore fails.
6Editor’s note: The proceedings in the present case were governed by
the pre-1985 Act legislation. The Housing Act 1985 repealed the whole of the
1957 Act.
The application
was dismissed with costs.
