Lease — Variation — Statutory powers — Tenancy agreement providing for different method of variation — Respondent council proposing to delete offending term – Appellant tenant applying for judicial review — Whether variation in tenancy conflicting with statutory provisions — Whether variation ultra vires respondents’ contracting powers — Appeal dismissed
The appellant was a secure tenant of the respondent council, which were a local housing authority for the purposes of the Housing Act 1985.
Section 102 of the Act provided that a secure tenancy might be varied in one of three ways “but not otherwise”: (i) by agreement; (ii) according to the terms of the lease; and (iii) in accordance with section 103 of the Act (that is, by notice of variation of a periodic tenancy served on the tenant by the landlord).
Clause 11 of the appellant’s tenancy agreement provided, inter alia, that the terms of the agreement could be changed only if a majority of the tenants’ representatives on the management board, which had been set up to serve local council-housing areas, agreed to it at a special meeting at which at least 25% of the representatives were present.
The respondents decided to implement a new secure tenancy agreement that included the removal of clause 11 on the basis that, in so far as the clause conflicted with sections 102 and 103 of the Act, it was ultra vires the respondents’ contracting powers as a public authority and therefore void. The appellant’s application for judicial review of that decision was dismissed, the judge holding that the respondents could not lawfully bind themselves by contract to subject their statutory powers to vary their tenancy agreements by notice to the approval of tenants’ representatives: see [2006] PLSCS 179.
The appellant appealed, contending that the statutory method of variation by notice was preserved by clause 11; it was merely that, as part of the process of good housing management, the respondents had introduced a restriction in favour of the consent of a majority of tenants’ representatives. The respondents’ submitted that clause 11 provided an absolute veto on their power unilaterally to vary terms of the tenancies by notice, which was incompatible with section 102 and 103 of the 1985 Act and amounted to both an illegitimate fetter on their discretion and to the delegation of their power to vary to the tenants’ representatives.
Held: The appeal was dismissed.
The 1985 Act specifically stated that a local authority’s contractual tenancies could be varied by unilateral notice and described in detail how that was to be done. A system that circumscribed that power by giving to tenants’ representatives an absolute veto was incompatible with the statute.
In the present case, the respondents were exercising their management powers under section 21 of the 1985 Act for the sole purpose of regulating secure periodic tenancies. In that context, section 102 and 103 mandated that, in the absence of agreement, or pursuant to agreement, the respondents were to have a unilateral right to vary conditions of a tenancy by notice, following consultation. Sections 102 and 103 constituted a complete code governing the variation of the terms of a secure tenancy, and the respondents had no power to amend statute by giving up their power of unilateral variation: R v Hammersmith and Fulham London Borough Council, ex parte Beddowes [1987] QB 1050 and R v London Borough of Brent, ex parte Blatt (1992) 24 HLR 319 considered.
In those circumstances, the doctrines concerning the prohibition on the fettering or delegation of a public body’s discretion did not arise but, had it been necessary to do so, the court would have concluded that those doctrines would have produced the same answer.
Nigel Griffin QC and Elizabeth Davies (instructed by Sternberg Reed) appeared for the appellant; Andrew Arden QC and Andrew Dymond (instructed by the legal department of Basildon District Council) appeared for the respondents.
Eileen O’Grady, barrister