Licence — Housing trust letting accommodation held under licence from council — Licence later replaced by lease then terminated — Whether trust letting as agent for council — Whether appellant occupiers having secure tenancy — Appeal dismissed
The second respondent was a charitable housing trust. It held various properties on a licence from the first respondent council under which it was required “in common with the Council to use and manage the properties on behalf of the Council” as temporary accommodation for homeless persons. The appellants were housed by the trust pursuant to the “singles scheme”, which operated for those to whom the council owed no statutory housing duty. The trust’s licence was subsequently replaced by individual leases granted in its favour by the council. The leases contained a break clause providing for termination by the council. The council later exercised that right, thereby bringing the tenancies to an end.
In possession proceedings brought by the council, the appellants argued that they had held secure tenancies. They contended that: (i) granting them exclusive possession of property in return for periodic payments gave rise to “Bruton tenancies”, which were binding upon the grantor; (ii) the trust had granted such tenancies as agent for the council; and (iii) on the council’s termination of the trust’s headleases, the appellants remained, or became, secure tenants under Part IV of the Housing Act 1985. Alternatively, the appellants submitted that the council’s termination of the trust’s leases breached their rights under Article 8 of the European Convention on Human Rights and Article 1 of the First Protocol to the Convention. The judge found that the appellants were not secure tenants, and he struck out their defence based on the Convention. The appellants appealed.
Held: The appeal was dismissed.
1. The licence agreement was intended to be declaratory of, or to formalise, the existing arrangements between the council and the trust. In the case of the singles scheme, these arrangements involved no relationship of principal and agent as between the council and the trust, and they suggested no relationship of landlord and tenant as between the council and the appellants.
2. A secure tenancy, for the purposes of sections 79 to 82 of the 1985 Act, assumed a direct landlord and tenant relationship between a landlord satisfying the landlord condition in section 80 and a tenant satisfying the tenant condition in section 81. Section 79 did not deal with cases like that of the appellants, where the occupying tenant’s immediate landlord held under a headlease granted by a superior landlord and each landlord satisfied the landlord condition: R v Plymouth County Council, ex parte Freeman (1987) 19 HLR 328 distinguished. In such cases, the occupier’s secure tenancy continued for as long as did the intermediate landlord’s lease, provided that both continued to meet their respective landlord and tenant conditions. That conclusion was unaffected by section 621 of the 1985 Act.
3. The appellants’ tenancies had not become binding upon the council. The termination of the trust’s licence was not analogous with the surrender of a head tenancy, where any subtenancy would survive against the head landlord. There was no basis for applying the surrender exception for leases to the termination of a licence. The trust had not been able to give the appellants an estate in land, and the appellants’ interest could not therefore bind the council: Barrett v Morgan [2000] 1 EGLR 8 considered.
4. The council had an unqualified right to possession, and the court was bound by authority to hold that the Article 8 argument could not succeed: Harrow London Borough Council v Qazi [2003] UKHL 43; [2003] 3 EGLR 109 applied. Nor was there a breach of Article 1 of the First Protocol. Article 1 could not confer a right of property, and the appellants’ tenancies were at all times vulnerable to the rule of domestic law that they would terminate on the lawful determination of the trust’s lease: Wilson v First County Trust Ltd (No 2) [2003] UKHL 40; [2003] 3 WLR 568 applied.
Jan Luba QC (instructed by Thomas & Co) appeared for the first appellant on the human rights issue; Jan Luba QC, Kelvin Rutledge and David Watkinson (instructed by Nicholas & Co acting as agent for Thomas & Co) appeared for the appellants on the property issue; Andrew Arden QC, Terry Gallivan and John McCafferty (instructed by Devonshires) appeared for the respondents.
Sally Dobson, barrister
