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Possession Proceedings, Residential Premises and Covid-19 by Tim Pullen

27th May 2020

Tim advises and represents clients in cases concerning land law, the law of landlord and tenant, insolvency, personal injury and contractual disputes as well as employment and housing law. 

Tim has wide experience of housing law, homelessness and related public law which forms a significant part of his practice. He acts for both tenants and landlords.  Tim is regularly instructed by a major national housing charity and by local authorities, housing associations and private landlords. His cases encompass the full range of housing disputes including:

  • Possession claims
  • Claims of disability discrimination under the Equality Act 2010
  • Article 8 defences
  • Disrepair/dilapidations
  • Anti-social behaviour and applications for Anti-Social Behaviour Injunctions;
  • Nuisance allegations
  • Homelessness appeals under section 204 of the Housing Act 1996

Tim has much experience of representing vulnerable and disabled tenants, many suffering psychiatric illness, and defending possession proceedings by relying on Article 8 of the ECHR and disability discrimination defences under the Equality Act 2010.

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The principal measures taken by the government to help residential tenants cope with the negative financial effects of the Covid-19 Crisis are set out in Schedule 29 of the Coronavirus Act 2020.  Its provisions came into force on 25th March 2020.

The Schedule amends the Protection From Eviction Act 1977, the Housing Act 1985 and the Housing Act 1988. The effect of the amendments is to require notices to quit or notices seeking possession, served after 25th March 2020 and up to 30th September 2020, to give an extended period of notice of three months. In practice, this means that any notice served  before 30th September 2020 in respect of an assured shorthold or assured tenancy (including section 8 and section 21 notices) or a secure tenancy (including flexible, demoted and introductory tenancies) or a Rent Act 1977 protected tenancy must give three months’ notice.

Paragraph 13 of the Schedule gives the Minister the power to extend the notice period to up to six months. However, the paragraph does not, on its wording, appear to permit the extension of notices which have already been served.

Schedule 29 also amends the prescribed form of notice (forms 3 and 6A). New versions of the forms have been produced.

The provisions do not apply to notices served before Schedule 29 came into force. They remain valid. The Schedule also does not apply to Rent Agriculture 1976 nor Assured Agricultural Tenancies, licences and contractual tenancies. Accommodation occupied under a licence, of course, includes much accommodation which is employment related.

The overall effect of the measures in Schedule 29 is to delay possession proceedings brought against most residential tenants by a relatively short period. The measures do not, apart from that, provide any relief or respite to tenants who have got into financial difficulties because of the effects of the Covid-19 crisis. As stated above, Schedule 29 also has no effect whatsoever on notices served before 26th March 2020.

In addition to the provisions in the Coronavirus Act 2020, a new Practice Direction 51Z of the Civil Procedure Rules came into force on 26th March 2020. Paragraph 2 of the Direction introduces a blanket stay for 90 days on all proceedings brought under CPR Part 55 for possession and all proceedings for enforcement (This originally included proceedings against trespassers). That period expires on 25th June 2020. There is the potential for this to be further extended. Paragraph 3 of the Practice Direction states that the stay in paragraph 2 does not preclude the issue of a claim for possession. It also makes clear that claims for injunctive relief are not subject to the stay.

The Practice Direction was amended on 18th April 2020 to add a further paragraph 2A. It provides that the stay in paragraph 2 does not apply to ‘a claim against trespassers to which rule 55.6 applies’ or an application for an interim possession under Section III of Part 55 (including the making of such an order, the hearing required by rule 55.24(4), and any application made under rule 55.28(1)) or an application for case management directions which are agreed by all parties.

A challenge was made to the Practice Direction in the case of Marshall (acting by Mehmet Arkin as fixed charge receiver) v Marshall & Another (2020) EWCA Civ 620. Judgment was handed down on 11th May 2020. The Court of Appeal considered two appeals. The claims were for possession under a mortgage. The case concerned three adjacent properties, two occupied by different members of the same family. The same mortgage was secured against all three properties. The mortgagee alleged that there had been breaches of the terms of the mortgage and that it was in arrears. It appointed receivers.  

The claims were allocated to the multi-track. The parties agreed directions on 26th March 2020. They were incorporated into an order sealed by the Central London County Court on 27th March 2020. The directions required various steps to be taken by the parties during May 2020 culminating in exchange of witness statements on 26th June 2020. The Defendants took the view that paragraph 2 of the Practice Direction discharged the parties of any obligation to take any of the steps required by the agreed directions within the 90 day period during which the stay under the Direction was in place. The Claimants disagreed. They asserted that the stay did not apply to the directions but, if it did, the stay should be lifted.  The matter was brought before HHJ Parfait in the County Court who ruled that the proceedings were stayed and that there was no power to lift the stay. In his order, he pushed back the dates of the directions that had been agreed to corresponding dates after the expiry of the stay.

The Receivers appealed contending that Practice Direction 51Z was made ultra vires, alternatively the judge at first instance was wrong to find that it was intended to apply to all proceedings under Part 55 and that he was wrong in concluding that the court had no power to lift the stay. The amendment to Practice Direction 51Z, adding paragraph 2A, came into force before the hearing of the appeal.

Sir Geoffrey Vos gave the sole judgment on behalf of the Court of Appeal. He determined that Practice Direction 51Z was not ultra vires. In so far as the agreed directions were concerned, he held that paragraph 2A meant that the Practice Direction did not apply to an application for agreed directions. However, the directions, once made, were stayed until the stay expired. The Court of Appeal said that there was an obvious value in the parties agreeing and obtaining the court’s endorsement of directions which will come into effect on the expiry of the stay. They came out of it with a ready-made timetable and will avoid the potential rush  to make applications once the stay is lifted.  The Court also observed that there is nothing to stop the parties getting on with agreed directions during the stay, if they so wish.

The Court of Appeal also held that a judge did have power in exceptional circumstances to lift the stay. However, it described this as a theoretical power. The Court stated that the purpose of the stay was to relieve court staff and judges in the County Court of having to deal with possession proceedings, which it described as an immense part of its workload and avoid the risk to public health which proceeding with evictions would create. It held that parties could not rely on their personal circumstances, however special they might be, in an application to lift the stay as this would fatally undermine the purpose of the stay. The Court stated that whilst it would not go so far as to say that there could be no circumstances in which it would be proper to lift the stay, it had the greatest difficulty envisaging such a case. It said that the only possible case canvassed before it was where the stay would operate in such a way as to defeat the purposes of Practice Direction 51Z and endanger public health. The Court referred to the decision in Bernicia Group v Mark Mann (17th April 2020) which was heard in Newcastle stating that that case may have been of that character but it did not know enough about the circumstances of the case to say so definitively. The author understands that the case concerned a property which had been vacant  for a significant period of time.

The effect of Practice Direction 51Z is, therefore, to stay all proceedings brought under CPR Part 55 for possession and enforcement,  including those proceedings already in the system and any new claims issued, except for the exceptions set out in paragraph 2A. The most significant exception being claims against trespassers which I discuss in more detail below. Whilst the court has a discretion to lift the stay, this power is more theoretical than real and the stay will only be lifted in the most exceptional of circumstances which are most likely to be in situations where public health is being endangered. Parties can agree directions and ask the court to ratify them. However, the proceedings will then be stayed.

For the purposes of Part 55, rule 55.1(b) defines a possession claim against trespassers as

 

“…….a claim for the recovery of land which the claimant alleges is occupied only by a person or persons who entered or remained on the land without the consent of a person entitled to possession of that land but does not include a claim against a tenant or sub-tenant whether his tenancy has been terminated or not.”

As is apparent, it does not include tenants who have remained on land or premises after a tenancy has ended. It does, however, include a claim against a former licensee where the licence has expired.

Paragraph 2A of Practice Direction 51Z states that ‘Paragraph 2 does not apply to- (a) a claim against trespassers to which rule 55.6 applies;…..’. This formulation is somewhat curious because rule 55.6 provides:

‘55.6

Where, in a possession claim against trespassers, the claim has been issued against “persons unknown”, the claim form, particulars of claim and any witness statements must be served on those persons by…………….’

It refers only to claims against ‘persons unknown’. This creates some ambiguity over whether the trespassers’ exception in Paragraph 2A of the Practice Direction applies to all possession proceedings against trespassers as defined by rule 55.1(b) or only those proceedings brought against persons unknown. It would seem odd that, in a situation where squatters have occupied land,  a claim did not fall within the exemption simply because a claimant had discovered or been told the squatter’s name. Surely, the intention must have been to include these types of claims within the exception. In many cases, the claimant will not even be sure that the name is the squatter’s real name. Problems can probably be avoided by bringing a claim against persons unknown in the alternative or, possibly, by bringing the claim against persons unknown and explaining matters in the particulars of claim. It is less clear, however,  whether proceedings for possession and enforcement against former licensees fall within the exception. It is more than arguable that the express reference in paragraph 2A to rule 55.6 and its reference to ‘persons unknown’ shows an intention to exclude those type of proceedings from the exception. It would be helpful if there was a further amendment to the Practice Direction to clarify matters.

 

Paragraph 3 expressly preserves claims for injunctive relief. This may provide a remedy where tenants are in breach of the tenancy agreement by restraining the breach where the stay prevents eviction. For example, in cases of serious anti-social behaviour or damage to the fabric of the premises let. It also permits social landlords to continue to bring claims for Anti-Social Behaviour Injunctions under the Anti-Social Behaviour, Crime and Policing Act 2014.

Mr Justice Chamberlain considered a claim for an interim injunction (which if granted would effectively be final) in  University College London Hospitals NHS Foundation Trust v MB (2020) EWHC 882 (QB). The facts of the case are unusual. It concerned trespass. Judgment was handed down on 9th April 2020. The defendant was occupying a hospital room. The hospital wished to discharge her. She refused to vacate because she was unhappy with the care plan put in place. Occupation was under an implied licence. This terminated and the defendant remained as a trespasser. The hearing and judgment took place before Practice Direction 51Z was amended. At the time of the hearing it placed a stay on all possession proceedings including proceedings against trespassers.

The claimant NHS Trust sought an injunction restraining the trespass. This was tantamount to giving possession. Notwithstanding this, the court exercised its discretion in favour of the Trust and granted the injunction. An application for an injunction may not now be needed, in the same situation, if paragraph 2A of Practice Direction 51Z does apply to all proceedings against trespassers. The facts of the case are highly unusual and there were compelling factors in favour of the grant of an injunction, not least the fact that the defendant was depriving others of an urgently needed bed on a neurological ward. It is unlikely, in almost all cases, that a court would be persuaded to exercise its discretion to grant an injunction which resulted in de facto possession of residential premises unless it is a trespass case within the scope of paragraph 2A. To do so would ride a coach and horses through the general stay imposed by paragraph 2 of the Practice Direction.

TIM PULLEN

22nd April 2020

 

 

 

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Possession Proceedings, Residential Premises and Covid-19 by Tim Pullen