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UC Housing Costs

Pete at CAB
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Childrens Centre Adviser, CAB, Camborne

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Cl is an adult and lives in an HA property with two teenage siblings. The tenant was their mother but she has passed away leaving rent arrears. The HA will not transfer the tenancy unless/until the rent arrears are paid off.

Cl continues to pay rent under ‘use and occupation/ mesne profits’ but has been refused any UC Housing Costs.

Para 2.345 of the 20/21 Sweet and Maxwell UC volume says that mesne profits dont count for UC (but did for HB) Unfortunately it isn’t very clear where that is set out in law.  Reg 2b of Sch1 UC regs just says ‘payments for a licence or other permission to occupy accommodation’ which ,at first sight, seems broad enough to cover mesne profits. The only thing I can see is that mesne profits are in some way seen as the HA discharging a duty on the Council under Case 2 in Reg 3B - in which case the cl could get HB?

Any thoughts gratefully received

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Debt Advice + Community Money Advice Launceston

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If the landlord has agreed to accept payments in order for your client to remain in the property, it could be argued that a licence has been created and therefore eligibility for UC housing costs as per below.
“Use and occupation charges & mesne profits
The SSAC questioned the omission of use and occupation charges and mesne
profits 66 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. “

Elliot Kent
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One of the most profoundly sensible provisions of the HB Regs is at Reg 12(1), the effect of which is to define rent as being inclusive of rent, licence payments, mesne profits, use & occupation payments and so on. The point of that provision is that if you are paying money to live in a property without acquiring a valuable interest in it, then you are paying “rent” as far as HB is concerned and benefit administrators do not need to put on their spelunking gear and go on an excursion into the murky depths of housing law to figure out basic points of entitlement.

UC of course couldn’t leave this sort of pragmatism be and re-wrote the rules so that now “rent” only relevantly constitutes “payments of rent” or “payments for a licence or other permission to occupy accommodation” - para 2, sch 1 UC Regs - so into the caves we go.

First “mesne profits”. Mesne profits are, broadly, payments due to a landlord by a former tenant who remains in occupation of the property beyond the end of their tenancy. The way I understand it, although possibly apocryphal, is that “mesne” is old French for “in between” so that the “mesne profits” are the profits which would have derived for the period in between the date on which the former tenant was supposed to leave and the date on which they actually did leave. But your client was never a tenant, so they cannot be paying mesne profits and we can leave that aside.

That leaves what the HB Regs termed as “payments in respect of, or in consequence of, use and occupation of the dwelling”. This refers to situations such as that of your client. They are occupying and have use of the property despite not having been granted a tenancy and the landlord is demanding payment from them in consequence of that use and occupation. What is the nature of those payments? This is rather unclear. It is possible to analyse the payments as being either (1) payments in lieu of damages consequential on your client’s unlawful occupation of the property (2) payments making equitable restitution for the use of the property or (3) payments pursuant to some sort of contractual or quasi-contractual agreement between the landlord and tenant falling short of a tenancy.

Which of those analyses is correct isn’t really fully clear as far as I am aware and all the reference material I have access to seems to approach the topic differently.

As the UC Regs adopt the language of permissions, on the face of it, U&O would only be covered if it can be analysed in terms of option (3) above i.e. that the landlord is entering into some sort of agreement to permit the ongoing occupation subject to the payments without creating a tenancy and without prejudice to their subsequent ability to take possession action to recover the property without notice.

However we do have something of a reprieve which is provided by guidance which encourages U&O to be treated as rent without engaging in this sort of analysis - see

Ultimately in practice, it seems to be that if you can provide UC with something from the housing association referring to the payment of use and occupation charges and ideally using a word like “agreement” or “temporary permission” then UC should pay up.

(Oh and this is to skip over all the stuff about whether it is correct that the client can’t succeed, the impact of probate and estates and so on. We are starting from the premise in the post which may or may not be correct that the mother’s tenancy is no more. There is some further discussion of the other aspects in this thread -

[ Edited: 4 Nov 2021 at 11:54 pm by Elliot Kent ]
Pete at CAB
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Childrens Centre Adviser, CAB, Camborne

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Whilst waiting for words of wisdom I managed to contact the cl who says he has just such a document as Elliot suggested and which he will upload to his UC account.

I also spoke to our very helpful Vulnerable Customer Lead at the local Jobcentre and was told that as the cl is an HA tenant there was some contact with the HA to confirm the tenancy. This came back as negative (which is of course perfectly true) and I wonder if this situation is an unintended consequence of some sort of automated checking system?

Timothy Seaside
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I’d expect the contact with the HA to be through the Landlord Portal in the form of a verification request (a “Confirm tenancy details” to-do). The first question is “Is this person your tenant and liable for rent at this address?” When you click “no” you get a text box to explain why you’ve said that. Then you are asked, “Are you accepting other charges (use and occupation)?” If you tick “yes” then the verification goes on as if you’d ticked “yes” to the first question.

So it’s a little surprising that the landlord has effectively rejected this request. Having said that, in a large HA I can see that there might be a lack of communication between whoever does the verifications and whoever has granted the licence (with all the caveats and reservations I’ve previously expressed about the true legal situation). The housing officer may have given them a piece of paper, but it may not be reflected on the system (and it may be the system that is legally correct).