Practice and procedure – Possession proceedings – Pilot scheme – Appellant challenging vires of Practice Direction 51Z, “Stay of Possession Proceedings – Coronavirus” – Whether PD 51Z properly authorised as pilot scheme for automatic 90-day stay of possession proceedings as result of coronavirus pandemic – Appeal dismissed
The appellant was the receiver appointed by mortgagees in respect of three adjacent properties at Lodge Farm in Welwyn, Hertfordshire, mortgaged to secure a loan to the respondent. The appellant commenced possession proceedings in the county court against the respondent borrower.
The claim was allocated to the multi-track and a case management conference was listed for 26 March 2020. The parties agreed directions which were incorporated into an order sealed on 27 March, the day that Practice Direction 51Z, “Stay of Possession Proceedings – Coronavirus” (PD 51Z) came into force. Paragraph 2 provided for an automatic 90-day stay of possession and enforcement proceedings.
The agreed directions required the parties to provide disclosure and inspection and to exchange witness statements by 26 June. On 20 April, para 2A(c) was introduced into PD 51Z, stating that para 2 did not apply to applications for case management directions which were agreed by the parties. The respondent argued that, as a result of the stay, the parties were discharged from the obligation to take the steps required by the agreed directions within the 90-day period.
The county court held that the proceedings were stayed and it had no power to lift the stay. The judge pushed back the agreed dates to corresponding dates that would post-date the lifting of the stay.
The appellant appealed. The Lord Chancellor was joined as an interested party and the Housing Law Practitioners Association intervened. The issue was raised whether PD 51Z was ultra vires.
Held: The appeal was dismissed.
(1) The appellant’s challenge was to very recent legislation of considerable public importance. It should have been made by distinct proceedings in the High Court under CPR Part 54 against the persons responsible for the legislation. The correct course would have been to seek a stay or transfer of the county court proceedings so that the vires challenge could be raised by judicial review. However, in the present case, the appellant’s failure to take that course had not produced any real unfairness nor created any insuperable difficulty for the Court of Appeal. There was a strong public interest in an early and authoritative ruling as to the validity of PD 51Z.
(2) Paragraph 1 of PD 51Z provided that it “is intended to assess modifications to the rules and [practice directions] that may be necessary during the Coronavirus pandemic and the need to ensure that the administration of justice, including the enforcement of orders, is carried out so as not to endanger public health”. The pilot nature of the stay was plain. The stay imposed by para 2 might reasonably be shown to be effective: to relieve pressures on the administration of justice during the pandemic; to reduce the risks of spreading the virus occasioned by enforcing possession orders and forcing citizens to move home; and/or to abrogate court hearings, whether remotely or face to face, in possession proceedings, thereby avoiding the need for court staff and litigants to risk transmitting the virus. Once that had been assessed, it might be appropriate to make a permanent rule or practice direction imposing a limited stay on possession proceedings when and if the pandemic peaked again.
(3) The appellant had argued that sections 81-2 of, and schedule 29 to, the Coronavirus Act 2020, which came into force after PD 51Z, were inconsistent with it. Paragraph 2(3) of schedule 29 included a new requirement in the Rent Act 1977 to serve three months’ notice of intention to commence proceedings against statutory tenants. A new section 3(4B) gave landlords a right to apply to the court to dispense with the new notice requirement if the court considered it just and equitable to do so. The appellant’s submission that PD 51Z rendered that right nugatory, because any proceedings commenced to resolve such an issue would be stayed immediately, was rejected. The provisions were not inconsistent. The 2020 Act would last for two years (subject to extensions), but the pilot stay only lasted for 90 days. There was no conflict between them. The Act changed the substantive law, and PD 51Z imposed a temporary stay to protect and manage county court capacity and ensure the effective administration of justice without endangering public health during a peak phase of the pandemic.
(4) The short delay to possession litigation enshrined in PD 51Z was justified by the exceptional circumstances of the coronavirus pandemic. As para 1 made clear, there was a need to ensure that neither the administration of justice nor the enforcement of possession orders endangered public health by the unnecessary transmission of the virus. PD 51Z did not risk persons being effectively prevented from having access to justice.
(5) As to the power to lift the stay, CPR part 3.1 set out the court’s general powers of case management. The power to impose a stay necessarily included the power to lift it. As a matter of strict jurisdiction, a judge retained the power to lift the stay which it imposed. But the proper exercise of that power was informed by the nature of the stay and the purposes for which it was evidently imposed. The purpose of PD 51Z was that during the 90-day period the burden on judges and staff in the county court of having to deal with possession proceedings, which were an immense part of its workload, would be lifted. The risk to public health of proceeding with evictions would also be avoided. That blanket purpose went far beyond any individual relationship of landlord and tenant or mortgagee and mortgagor. Possession claims were not to be dealt with on a normal case by case basis during the stay. Although as a matter of strict jurisdiction a judge retained a theoretical power to lift any stay, it would almost always be wrong in principle to use it except in the most exceptional circumstances; the circumstances of this case did not allow the court to lift the stay.
Philip Rainey QC and Michael Walsh (instructed by Collyer Bristow LLP) appeared for the appellant; Stephen Knafler QC and Julian Gun Cuninghame (instructed by Direct Access) appeared for the respondents; Jonathan Auburn (instructed by the Government Legal Department) appeared for the interested party; Martin Westgate QC and Daniel Clarke (instructed by Edwards Duthie Shamash) appeared for the intervener.
Eileen O’Grady, barrister
