Unfit houses in Hartlepool–Whether owner-occupier’s supplement payable–Claimants purchased during qualifying period–Gap between vendors quitting and purchasers taking up residential occupation–Void periods allowed for rates–Held that houses not occupied as private dwellings ‘throughout’ qualifying period as required by para 1 (1) of 5th Schedule to Housing Act 1969–No entitlement to supplement–Tribunal’s views on possible claim under para 1 (2) of 5th Schedule
Mr C L Kelly
(instructed by R Bell & Son; Gilbert Bunting & Co; Braid Lupton &
Co; Tilly, Bailey & Irvine; and Levinsons, Walker & Lister, all of
Hartlepool) appeared for the claimants; and Mr P Tarbuck, assistant solicitor,
Hartlepool Borough Council, represented the acquiring authority.
Giving his decision,
MR WELLINGS said: These are references to determine the amount of compensation
to which the several claimants are entitled in respect of their houses in
Hartlepool, which houses have been compulsorily purchased by the acquiring
authority under Part III of the Housing Act 1957. Each claimant, in addition to
claiming compensation by reference to the site value of his house, claims an
owner-occupier’s supplement (increasing compensation to the full market value
of the house) under the provisions of section 68 of the Housing Act 1969 and
the Fifth Schedule thereto. The dispute in all the cases is essentially one and
the same: each claimant bought his interest (the freehold estate) during the
course of ‘the qualifying period’ as defined by the Fifth Schedule to the Act
of 1969: after his vendor quitted the house there was a period of delay before
he took up residential occupation (at all events in a full sense): can he
nevertheless allege that ‘throughout the qualifying period the house was wholly
or partly occupied as a private dwelling?’
The primary facts were the subject of agreement or unchallenged evidence
and the dispute between the parties is one relating to the proper
interpretation of the statutory provision and the manner in which it should be
applied to the facts.
Fifth Schedule
Provisions
Section 68 of
the Housing Act 1969 provides that the provisions of Schedule 5 to that Act are
to have effect with respect to certain payments to be made in respect of
owner-occupied houses in certain circumstances. The relevant provisions of the
Fifth Schedule to that Act are as follows:
‘1. (1) Where
a house has been purchased at site value in pursuance of a compulsory purchase
order made by virtue of . . . Part III of the Act of 1957 . . . or has been
vacated in pursuance of . . . a clearance order, then, if:
(a) the relevant date is later than April 23
1968; and
(b) on the relevant date and throughout the
qualifying period the house was wholly or partly occupied as a private dwelling
and the person so occupying it (or, if during that period it was so occupied by
two or more persons in succession, each of those persons) was a person entitled
to an interest in that house or a member of the family of a person so entitled;
the authority
concerned shall make in respect of that interest a payment of an amount
determined in accordance with paragraphs 2 and 3 of this Schedule.
(2) Where an interest in a house purchased or
vacated as mentioned in subparagraph (1) of this paragraph was acquired by any
person (in this subparagraph referred to as the first owner) after April 23
1968 and less than two years before the relevant date, and a payment under
subparagraph (1) of this paragraph in respect of that interest would have
fallen to be made by the authority concerned had the qualifying period been a
period beginning with the acquisition and ending with the relevant date, the
authority concerned shall make to the person who was entitled to the interest
at the date the house was purchased or vacated a payment of the like amount,
if:
(a) the authority are satisfied that before
acquiring the interest the first owner had made all reasonable inquiries to
ascertain whether it was likely that the order, notice or declaration by
reference to which the relevant date is defined in paragraph 5 (1) of this
Schedule would be made or served within two years of the acquisition and that
he had no reason to believe that it was likely; and
(b) the person entitled to the interest at the
date when the house was purchased or vacated was the first owner or a member of
his family.’
By paragraph 5
of the Schedule ‘the relevant date’ and ‘the authority concerned’ are defined,
in the case of an area declared as a clearance area, as ‘the date when and the
authority by whom the area was so declared.’
For present purposes ‘the qualifying period’ means the period of two
years ending with the relevant date (paragraph 5).
The references
were heard together. There was a seventh similar reference (REF/36/1975: Mr and
Mrs M Cartin). It was heard separately and accordingly I give my decision in
that case separately also [see p 579 of this issue].
Facts
From
statements of agreed facts and other sources I find the following facts:
1. In the case
of REF/37/1975 (Mr J T Galloway) the relevant date was October 7 1971 and the
qualifying period was from October 8 1969 until October 7 1971. In each of the
other cases the relevant date was April 5 1973 and the qualifying period from
April 6 1971 until April 5 1973.
2. Valuations
were agreed both in respect of site value and in respect of the amount of the
owner-occupier’s supplement which would be payable if entitlement thereto were
established.
3.
REF/32/1975: 1 Plevna Street, Hartlepool: claimant, Mr T Michie. The house was
occupied by the vendors, Mr and Mrs A V Robinson, as a private dwelling, from
July 31 1954 until October 21 1971. On that date they moved to a council house.
After that date they did not occupy 1 Plevna Street as a private dwelling. They
did not put that house on the market for sale until early January 1972 because
they wished to cause it to be redecorated. The redecoration was carried out by
Mrs Robinson’s sister. Her occupation, if occupation it was, was not
residential in character. When the redecoration was completed, at the beginning
of January 1972, the house was advertised for sale. Mr Michie’s offer of £275
for the house was informally accepted. He took physical occupation of the house
at some time between the middle and end of January 1972. The conveyance to him
was executed on April 10 1972.
4.
REF/33/1975: 13 Plevna Street: claimants, Mr and Mrs I D Garbutt. The vendor of
this house lived in it from November 30 1967 until July 1 1972, on which date
he vacated the house and moved to another property which he had purchased. On
July 2 1972 Mr I D Garbutt and his fiancee (now Mrs Garbutt) obtained the keys
of 13 Plevna Street and immediately took occupation of it, their offer of £450
for the house having been informally accepted. In the house were some chairs
and a settee and various other items of furniture belonging to the vendor.
These were of no value and were thrown away by Mr Garbutt and his fiancee.
Having taken occupation, they began to clean and redecorate the house.
Contracts were exchanged on August 17 1972. Mr Garbutt and his fiancee were
married on September 2 1972 and the conveyance to them was dated September 5
1972. Their carpets and furniture were moved into the house about one week
before they got married. They started living together in the house after
marriage.
5.
REF/34/1975: 18 Talbot Street: claimant, Mr D L Tose. The vendor ceased to
occupy the house as a private dwelling on June 15 1971, having lived there
since the beginning of the qualifying period. At a date before July 27 1971 the
claimant had applied for a building society advance. On July 28 1971 that
advance was approved by the building society. On July 29 1971 the claimant
began to occupy the house for the purpose of cleaning and redecorating it. He
took brushes and paints with him and two chairs and step ladders to assist him
in the work of decoration. He had some snack meals there and some cups of tea.
He was married on August 31 1971 and he and his wife began living together in
the property on September 3 1971.
6. REF/35/1975:
21 Talbot Street: claimant, Mr D Laundon. The vendor ceased to occupy the house
as a private dwelling on October 27 1972, having lived there since the
beginning of the qualifying period. From October 27 1972 until November 6 1972,
when the keys of the house were given to Mr Laundon, the house was unoccupied.
From November 6 1972 until November 25 1972 Mr Laundon was occupying the house
for the purpose of redecorating it and preparing it ready for his residential
occupation. On November 25 1972 Mr and Mrs Laundon began to live in the house.
After October 27 1972 some items of furniture belonging to the vendor had
remained in the house. They were included in the sale to Mr and Mrs Laundon.
They paid the purchase price for the property on November 15 1972, but the
transaction was not completed until November 7 1973.
7.
REF/37/1975: 43 Blake Street: claimant, Mr J T Galloway. The vendor ceased to
occupy the house as a private dwelling on January 16 1971, having lived there
since the beginning of the qualifying period. The claimant took possession of
the house on January 16 1971, on which date the sum of £100 was informally
agreed. Contracts were exchanged on January 29 1971 and completion took place
on February 9 1971. The claimant, however, did not occupy the house
residentially until March 25 1972. He spent the 14 months after the vendor
vacated the property in repairing and redecorating it. The repairs carried out
by the claimant were of a major nature and included provision of some new
floors and new electric wiring. He sometimes had to stop work and save up money
in order to enable him to embark on the next stage of repair. At the end of the
14-month period he married and he and his wife then began living in the
property.
8.
REF/239/1974: 4 Plevna Street: claimants, Mr and Mrs D Reeve. The vendor
occupied the house as a private dwelling from January 23 1961 until December 28
1972, on which date he ceased to occupy it as a private dwelling. On that date
the claimants began to occupy the premises for the purpose of redecorating
them. To assist them in the work of redecoration they took two chairs to the
premises and had frequent meals and cups of tea there. At the beginning of
February 1973 they took a table, four chairs, a cabinet, pots and pans and two
wall cupboards to the house. A refrigerator had been put by them in the kitchen
in early January 1973. They were married on March 3 1973 and on that date began
to live together in the house.
9. During the
period in which the occupation by Mr and Mrs Garbutt, Mr Tose, Mr Laundon, Mr
Galloway and Mr and Mrs Reeve of their respective houses was limited to the
purpose of redecoration or repair or improvement, they all possessed the
settled intention, so soon as practicable, to reside in them.
10. In each of
the cases referred to the tribunal there was a ‘void period,’ allowed by the
rating authority, in respect of which no general rates were paid (or if paid
they were refunded). The void periods were:
1 Plevna
Street October 20 1971 to April 1 1972.
4 Plevna
Street December 17 1972 to March 2 1973.
13 Plevna
Street May 31 1972 to September 1 1972.
18 Talbot
Street June 15 1971 to September 3 1971.
21 Talbot
Street October 19 1972 to November 25 1972.
43 Blake
Street January 16 1971 to October 7 1971.
Except in
respect of 13 Plevna Street, these periods are the same as, or approximate to,
the periods intervening between the dates on which the claimants’ vendors
ceased to reside in the respective houses and the dates on which the claimants
began to reside in them in a full sense. According to my finding No 4 above,
the void period in respect of 13 Plevna Street should have begun on July 1
1972.
11. In a case
(which I will call Graham’s case) not referred to the tribunal, the acquiring
authority has paid to a Mr Graham an owner-occupier’s supplement in the
following circumstances: the relevant date was March 4 1971 and the qualifying
period was from March 5 1969 to March 4 1971. On March 28 1970, Mr Graham’s
vendor, who had at all material times occupied 19 Gill Street, Hartlepool, as a
private dwelling, ceased to reside there and on the same date instructed estate
agents to sell the house. On April 3 1970 the agents inspected and asked the
vendor to remove his furniture, with which requirement he forthwith complied.
On April 8 1970 Mr Graham made an offer to purchase the house. On April 9 1970
the vendor’s mortgagees (a building society) accepted the position and, the
vendor being in default under the mortgage, gave instructions that the house
should be sold under their power of sale and at the price offered by Mr Graham.
On May 7 1970 contracts were exchanged, the mortgagees being expressed to be
vendors. On May 7 1970 also the keys were released to Mr Graham, who thereupon
began to clean and decorate the house. Com-
the house.
Argument. Mr C L Kelly of counsel on behalf of the claimants submitted that
under the Fifth Schedule to the Housing Act 1969 the house is to be regarded as
occupied as a private dwelling in any period in which it is in fact empty (a)
if it is empty pending sale and the vendor left with the intention of selling
for use by the purchaser as a private dwelling or (b) if it is empty pending
the purchaser’s moving in, that being his intention.
Inadmissible
Documents
In support of
these wide propositions, Mr Kelly referred me to many authorities relating to
occupation or, as the case be, beneficial occupation under various statutes,
including the Rent Acts and statutes relating to rating, town and country
planning, occupier’s liability and business tenancies. He also sought to
persuade me that, in ascertaining the meaning of the reference to occupation as
a private dwelling in the Fifth Schedule to the Housing Act 1969, I was obliged
to have regard to the White Paper Old Houses into New Homes (Cmnd 3602),
which was published in 1968 and explained the Parliamentary Bill which
ultimately (no doubt after various amendments) became the Housing Act 1969, and
also to a circular, No 68 of 1969, issued by the Ministry of Housing and Local
Government [Housing Act 1969: Slum Clearance]. At the hearing I
looked at these documents de bene esse in order that I should understand
Mr Kelly’s arguments based on them. Having looked at the documents, I declined
to consider them further on the ground that they were quite inadmissible. I
adhere to that view: see Maxwell on Interpretation of Statutes, 12th ed,
pp 51 and 52.
Mr Kelly said
that the decisions on ‘non-occupying’ tenants under the Rent Acts were material
because the definition in section 3 of the Rent Act 1968 of the qualifying
conditions for a statutory tenancy used similar words (‘if and so long as he
occupies the dwelling-house as his residence’) to the words ‘occupied as a
private dwelling’ in paragraph 1 (1) of Schedule 5 to the Housing Act 1969.
Accordingly he cited the leading case of Skinner v Geary [1931] 2
KB 546. He also referred to decisions on ‘two-homes men’ including Herbert
v Byrne [1964] 1 All ER 882, in which the judgment of Lord Denning MR
contains, at 886, a passage relied upon by Mr Kelly: ‘a man on the move may
have a home in each place until the move is completed.’ Mr Kelly also referred to Maxwell, supra,
at 79. He conceded that the Rent Acts authorities did not assist him in those
cases where a claimant’s original occupation began after the vendor vacated. In
those cases he (Mr Kelly) was driven to submit that the vendor was to be
treated after vacating as continuing in occupation as a private dwelling if he
left with the intention of selling for use by a purchaser as a private
dwelling. He also conceded that during the periods in which Mr and Mrs Reeve
and other claimants were in occupation merely for purpose of repairing,
decorating or improving their houses they were not in occupation for rating
purposes: see Hampstead Borough Council v Associated Cinemas
[1944] 1 All ER 436; Arbuckle Smith & Co v Greenock Corporation
[1960] AC 813; Bexley Congregational Church Treasurer v Bexley London
Borough Council [1972] 2 QB 222. It had been held by the Court of Appeal in
Ministry of Transport v Holland (1962) 14 P & CR 259 that the
test of occupation in the definitions of ‘owner-occupier’ and ‘resident
owner-occupier’ in section 43 of the Town and Country Planning Act 1959,
relating to the right to serve blight notices, was the same as the test in the
rating cases. That decision, therefore, Mr Kelly said, might be against him.
Mr Kelly
pointed out, correctly, that in three of the present cases (Garbutt, Galloway
and Reeve) there was no gap between vacation of the house by the vendor and the
date on which the claimants originally began to occupy their houses. If those
claimants were entitled to an owner-occupier’s supplement it was monstrous if
Mr Laundon were not so entitled, since the corresponding gap in his case was a
mere 10 days. If Mr Kelly’s argument were wrong I ought to apply a de
minimis principle.
Meaning of
‘Occupied’
Mr P Tarbuck,
on behalf of the acquiring authority, said that the question in the first place
was one of interpretation of the words used in the Fifth Schedule to the Act of
1969. In his submission the words ‘occupied as a private dwelling’ in paragraph
1 (1) of that schedule did not bear any artificial meaning such as that which
Mr Kelly managed to extract from the Rent Acts cases but bore their ordinary
meaning: see Lee-Verhulst (Investments) Ltd v Harwood Trust
[1973] 1 QB 204 (a case on the meaning of the word ‘occupied’ in section 23 of
the Landlord and Tenant Act 1954). Occupation by the claimants for the purposes
of redecoration, repair or improvement of their properties merely was not the
equivalent of occupation as a private dwelling. Occupation in that sense did
not begin until the claimants began to reside in their respective houses in a
full sense. In all six cases there was a gap between the vacation of the house
by the vendor and the beginning of full residence by the claimants of, at the
shortest (Mr Laundon) 1 month and at the longest (Mr Galloway) 1 year 2 1/2
months. In three of the cases (Michie, Tose and Laundon) there was a gap
between the date on which the vendor vacated and the date on which occupation
of the claimants first began. This gap was at its shortest in the case of
Laundon (10 days) and at its longest in the case of Michie (at least 2 1/2
months). It was not possible to fill that gap, as Mr Kelly sought to fill it,
by treating the vendor as having continued in occupation residentially beyond
the date on which he in fact ceased to reside in the house. If the de
minimis principle were applicable it could not apply to a gap so large as
10 days. The truth of the matter was that the schedule expressly contemplated
that there might be an interval of time between cesser of residential
occupation by a vendor and the beginning of residential occupation by a
purchaser and this eventuality was expressly catered for in subparagraph (2) of
paragraph 1 of the schedule. However, no application to the acquiring authority
under that subparagraph had been made.
Mr Kelly, in
reply, said that subparagraph (2) was inserted to deal with a purchase by a
sitting tenant from his own landlord and was not apt to resolve the
difficulties in the cases before the tribunal.
Decision. In my opinion Rent Acts decisions are not a useful or relevant
guide. In so far as they permit an intention to return (that is the
operative word) to residential occupation previously enjoyed to be substituted
for actual personal occupation, the test which they pose is not only somewhat
technical and artificial but is also a test of retention of possession
rather than occupation: see Increase of Rent and Mortgage Interest Restrictions
Act 1920, section 15 (1); Rent Act 1968, section 3 (2). In my judgment the word
‘occupied’ in the Fifth Schedule to the Act of 1969 has its ordinary meaning,
which is a broad meaning not limited to personal occupation but includes
occupation enjoyed vicariously through furniture and caretakers and
constructively through the exercise of control of the subject-matter. The
question in the present cases, of course, does not relate to mere occupation.
It is: was the house throughout the qualifying period wholly or partly
occupied as a private dwelling?
In my opinion the word ‘throughout’ means what it says: there must be no
break in residential occupation. Any injustice which this meaning might
otherwise produce is, however, tempered in a proper case by subparagraph (2) of
paragraph 1 of the schedule. That is an enabling provision.
to it. Unfortunately none of the claimants was willing to rely on that
provision, at all events before me.
Taking each
case in turn, I hold that each claimant is, for the reasons hereinafter
severally stated, not entitled under subparagraph (1) of paragraph 1 of the
Fifth Schedule to the Act of 1969 to an owner-occupier’s supplement:
(1) REF/32/1975: 1 Plevna Street. It is
impossible to treat Mr Michie’s vendors as continuing in residential occupation
beyond October 21 1971. There was therefore a gap of at least 2 1/2 months in
which the house was not wholly or partly occupied as a private dwelling.
(2) REF/33/1975: 13 Plevna Street. While there
was no break in occupation, there was a period of two months in which, though
the house was as a whole occupied by Mr and Mrs Garbutt, it was not wholly or
partly occupied as a private dwelling. During that period their occupation was
for the purpose of preparing for residential occupation. Notwithstanding their
intention that their occupation should be residential in quality in the future,
it did not yet possess that quality.
(3) REF/34/1975: 18 Talbot Street. Here there was
a gap of 1 1/2 months after Mr Tose’s vendor ceased to reside in the house
before Mr Tose began to prepare it for residence and a further month before his
occupation became residential in quality.
(4) REF/35/1975: 21 Talbot Street. There was a
gap of 10 days in which the house was completely unoccupied. In my view that is
in itself sufficient to destroy Mr Laundon’s claim to an owner-occupier’s
supplement. There was a further period of 1 month before Mr Laundon’s
occupation became residential in quality.
(5) REF/37/1975: 43 Blake Street. The facts of
this case were the same as those in REF/32/1975, except that here the period in
which the house was being prepared for residential occupation was more than 14
months. Moreover, in this one case the house was not occupied as a private
dwelling on the relevant date itself.
(6) REF/239/1974: 4 Plevna Street. The facts were
in effect the same as those in REF/32/1975.
Award
In the
premises I award to the claimants agreed site value compensation as follows:
|
(1) |
REF/32/1975: |
1 Plevna Street: Mr T Michie |
£28 |
|
(2) |
REF/33/1975: |
13 Plevna Street: Mr and Mrs Garbutt |
£25 |
|
(3) |
REF/34/1975: |
18 Talbot Street: Mr D L Tose |
£28 |
|
(4) |
REF/35/1975: |
21 Talbot Street: Mr D Laundon |
£24 |
|
(5) |
REF/37/1975: |
43 Blake Street: Mr J T Galloway |
£33 |
|
(6) |
REF/239/1974: |
4 Plevna Street: Mr and Mrs |
£31 |
together
with in each case the claimants’ surveyors’ fees
(if any) on Scale 5 (a) of the Royal Institution of Chartered Surveyors and
their legal costs incurred prior to the references herein.
It follows
from my observations and decisions above that the owner-occupier’s supplement
paid by the acquiring authority in Graham’s case was wrongly paid.
Guidance on
Schedule 5, para 1 (2)
I was asked by
Mr Tarbuck to give some guidance as to the proper approach to subparagraph (2)
of paragraph 1 of the Fifth Schedule in case the claimants should make a claim
upon the acquiring authority under that provision. I doubt whether there is any
really useful guidance upon that provision which I can give. It does appear to
me that all the claimants fulfil all the conditions of that provision save one.
The exception is the requirement that the acquiring authority must be satisfied
that before acquiring his interest the first owner (an expression which covers
each claimant because it means ‘the owner first hereinbefore-mentioned’) had
made all reasonable enquiries to ascertain whether it was likely that the
order, notice or declaration by reference to which the relevant date is defined
in paragraph 5 (1) of the schedule would be made or served within two years of
the acquisition and that he had no reason to believe that it was likely. The
acquiring authority has not even been asked to say that it is satisfied as to
these matters. The decision on these matters is one entirely for the acquiring
authority and not for the Lands Tribunal. The decision, once given, is not, as
I understand the law, open to review either by the tribunal or by the courts:
see Robinson v Minister of Town and Country Planning [1947] KB
702. No doubt the acquiring authority would regard the making of the usual
local authority searches by the claimants as constituting all reasonable
enquiries. No doubt also its approach to the question of satisfaction in
respect of the other matters would be a commonsense approach, paying attention
to the replies to searches received by the claimants and any other relevant
knowledge possessed by them.
The claimants
in each reference will pay £10 towards the costs of the acquiring authority. I
order legal aid taxation of the costs of the claimant Mr D Laundon
(REF/35/1975) and the claimant Mr J T Galloway (REF/37/1975) under Schedule 2
to the Legal Aid Act 1974.
