use and occupation

Hi

I have a situation where there are 2 young ladies who were living with Mother who has recently died. The property had already been succeeded once on death of Father so cant be again im told. The ladies have been told they have a use and occ account and are paying compensation for trespass and any payments accepted are mesne profits. This is in writing (and I believe has been sent to UC) This is pending finding more suitable accommodation.

One lady is on JSA and her 50% is being met by HB. The other sister was on IS as a carer but this has now ended and she has claimed UC. She is told that UC will not pay her housing costs.

I have trawled the regs and can see that such payments are not treated as rent (and I guess they are not rent); nor are they excluded from being treated as such - no mention (that I can see). DWP DMG does address this and expressly states that mesne profits cannot be treated as rent.

we are not in a full service area at present, but wil be in July. I am asking various people to look at the wording and to consider maybe licence agreements or changing the wording/giving two letters stating they have permission to occupy; and have asked for this to be looked at as a policy issue as there will no doubt be other cases etc but just wondered what other LAs do in these circumstances? or does anyone know of a way round this? I was thinking of the permission to occupy rule but im told by housing that technically this is an illegal occupation (with permission though to be there??) please help

http://www.rightsnet.org.uk/forums/viewthread/7945/

See final comment from Glenys (mycatismo): it seems describing the payments as being for permission to occupy will do the trick.  Landlords might have to get used to this

Thank you that is very useful, I have out housing team and legal dept looking at the wording on our letters. However, the DWP have specifically stated F2043 that mesne profits cannot be included as rent - and I guess this is where there is a mis match between what is stated in the regs (which neither states that such payments can, nor that they cant) and DWP interpretation - which is quite specific

F2043 Rent payments do not include mesne profits.

I will challenge the decision and see where it goes - thank you for your help

http://www.tenancydepositscheme.com/news/blog/mesne-profits-how-to-accept-rent-without-jeopardising-possession/

basically, it’s just in the name.  if they called it something else there wouldn’t be a problem.

and perhaps contact the MP, since surely this situation must arise reasonably regularly and will result in people getting into unnecessary debt at a time when they’re already distressed through bereavement and having to find somewhere to move to when they will have no priority for social housing…..

brilliant - thank you Claire. . Im sure its the wording on our letter which has caused the problem as it mentions trespass. I have sent this to our legal dept. The MP is already involved so hopefully will also be looking into this further

My limited understanding is that mesne profits are monies paid as damages to a landowner by a trespasser in recognition of their unlawful and unauthorised occupation of the property. The advantage to the landowner is that they can receive mesne profits without weakening their position in respect of eviction proceedings.

I expect your legal department will be reluctant to adopt the language of “permission to occupy” because if you give the occupier “permission to occupy” you can no longer describe them as a trespasser - they have your permission to occupy the property so they aren’t a trespasser. At best they are a licensee and, at worst, a Judge will say you have accidentally granted them a tenancy. In either case, the landowner is in a weaker position if they decide to remove the occupier.

Its a matter for them I suppose.

Agree with Claire.  One must look behind the words to determine the actual facts of the arrangement (see Street v Mountford, 1985 HoL).  There is no requirement for an express grant of land to be made as such.  Mesne profits, for example are (as has been noted above) a form of compensation for unauthorized use of land where, typically a tenant holds over after the expiration of a lease.  Typically, a landlord will be aware of the use and by not taking steps to remove the trespasser simply accepts continuing payments.  Remember, grants of land for less than three years do not have to be in writing.

Of course, mesne profits are expressly catered for in HB legislation but not in UC.  However, “use and occupation agreements”, whether in writing or not, cover this gap.  I suspect the reason for the change is part of the modern day trend by legislators to update statutory language by substituting modern terminology for archaic forms.

I agree Elliott .. our legal dept are treading very carefully (and I understand why) but they are looking into it. Our current letter states

If you remain at .(address)......... after termination of the tenancy on (date)............ you will be classed as a trespasser of the property under law and liable to pay use and occupation charges from ..... (date) until you move to an alternative property.

apparently, it is the use of the word trespass that UC object to. Obviously, I can challenge this and try to argue that by acknowledging that the person remains at the property, by creation of a use and occ account, and by accepting the charges, there is an implicit consent for the person to remain at the property??

also refer to the discussion recorded in Hof C and the fact this was indeed their policy intention?

I will wait till legal get back to me next week and then depending on what they say will ask for MR.

thanks again to everyone, this is all really useful

The use of the word “trespasser” should not be misunderstood.  In land law there is a concept of the “tolerated trespasser”.  This is someone who is on the land without the owner’s express permission but by being aware of the trespass and doing nothing, the landlord has given tacit acceptance.  In and by itself, it is not usually fraught with legal difficulty.

thanks Nevip - will also use this in my letter. just such a shame that this family have this stress at a difficult time for them.  Hope we can expedite resolution of this issue.

I cant see why the use and occupation needs to be split 50-50…...... (the old rent wasn’t split ) 

Isnt there an argument that either sister could pay the full 100%  ? 

You would then claim HB on the full 100% occupation charge….. from the sister that can claim…. and go for a backdate? 

sorry Martin for late response.

We have considered this but are a bit wary (it may be me being over cautious) but we want to make sure that both sisters are equally entitled to the same assistance with rehousing; that there are no issues with the sisters if they fall out, and finally, one sister would be a non dep and therefore subject to a non dep charge. Our income team was surprised that this had been set up as a joint account, and im not sure what other implications or thoughts there may have been behind this. We now have a reworded letter so fingers crossed ....

http://www.bailii.org/uk/cases/UKUT/AAC/2017/151.pdf

this just reported might assist….

thanks Claire - am just waiting for a response from UC but will come back to that case if needed

We have been told by UC that there is no prohibition of awarding Housing Costs for mesne profits.

Mesne profits Housing Costs should be claimed in the normal way and will be paid on receipt of a UC182 from the landlord regardless of whether or not there is a legal right to occupation.

I have checked this out in the Advice for Decision Makers guidance and it seems really bizarre.

F2041 Subject to F2042 and F2043 rent payments are1
1. payments of rent
2. payments for a licence or other permission to occupy accommodation
3. mooring charges payable for a houseboat
4. where accommodation is a caravan or mobile home, payments in respect of the site on which it stands
5. contributions by residents towards maintaining almshouses (and essential services in them) provided by a housing association which is

5.1 a registered charity or
5.2 exempt charity under prescribed legislation2.
1 UC Regs, Sch 1, para 2; 2 Charities Act 2011, s 3

Payments excluded from being rent payments
F2042 Rent payments do not include payments1
1. of ground rent
2. in respect of a tent or the site on which a tent stands
3. in respect of approved premises
4. in respect of a care home
5. which are owner occupier payments as in F2045
6. which are service charge payments as in F2050.
7.in respect of specified accommodation

Note: If a claimant lives in exempt accommodation help with housing costs will be provided by their LA.
1 UC Regs, Sch 1, para 3

F2043 Rent payments do not include mesne profits.

So mesne profits are not included under F2042 which lists payments which are excluded as being rent payments. Instead they have their own paragraph F2043 with no statutory denotation to justify their exclusion..

They are not included as rent payments under the UC regs Schedule 1 para 2 but neither are they specifically excluded under Schedule 1 para 3.

The House of Commons Briefing Paper no. 6547 on “Housing Costs in Universal Credit2, dated 12 June 2017, states at para 2.13:

Use and occupation charges & mesne profits

The SSAC questioned the omission of use and occupation charges and mesne profits22 from the definition of rent payments that the housing costs element of UC will cover:
Rent Payments (Schedule 1, para 2): in the definition of ‘rent payments’ no provision is made for ‘use and occupation charges’ (the payments made by a person commonly left in the property after the death of a tenant whilst the new tenancy situation is resolved). Similarly there is no provision for mesne profits.

The Government said:
No specific provision is being made for mesne profits in the housing element of Universal Credit as we consider that they would be more likely to appear as rent or payments for a licence or permission to occupy. In these cases legitimate housing costs are likely to be covered under Schedule 1 of the regulations. We decided not to carry forward specific provision for mesne profits as it would not be fair for the benefit system to underwrite such arrangements.23

23 DWP, Universal Credit and related regulations: Response to SSAC technical comments and policy points.