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12 February, 2021 Open access

‘Substantial rent arrears’ exception allowing evictions during Covid suspension period does not apply where possession order made under section 21 even when rent arrears money order made at same time

[2021] EWHC 283 (QB)

In a new judgment, the High Court has ruled that the ‘substantial rent arrears' exception from the suspension of evictions under the Public Health (Coronavirus) (Protection from Eviction) (England) Regulations 2021 (SI.No.15/2021) (the January Regulations) does not apply in a case where a possession order was made under section 21 of the Housing Act 1988 (the 1988 Act) even when a rent arrears money order was made at the same time.

In Trinity House of Deptford Strond v Prescott & Anor [2021] EWHC 283 (QB) (11 February 2021), the defendants were granted an assured shorthold tenancy ending on 30 November 2019 but determinable by two months' notice. In October 2019, after the defendants built up rent arrears, the claimant landlord served a Notice under section 21 of the 1988 Act and a Notice Seeking Possession that relied on arrears of five months’ rent (at the time) and threatening possession proceedings based upon mandatory Ground 8 in Schedule 2 to the 1988 Act (more than two months arrears) and discretionary Grounds 10 (non-payment of rent) and 11 (persistent non-payment of rent).

The defendants did not make payments towards the arrears or ongoing rent liability which led to the claimant issuing a claim seeking possession and a money judgment for arrears. However, the only basis given for the claim for possession was the Section 21 Notice, (although the claimant subsequently applied to amend the claim seeking also to rely on Grounds 8, 10 and 11).

The claim proceeding to a hearing before Deputy District Judge Rea (the DDJ) on 10 January 2020, which resulted in -

While the claimant then applied for a Warrant of Possession, and subsequently a Writ of Possession - which were issued on 14 February 2020 by the County Court, and 8 January 2021 by the High Court respectively - enforcement did not take place on account of the series of restrictions that have been introduced to limit the circumstances where evictions of tenants from their homes can take place during the Covid-19 pandemic (the latest of which runs until 21 February 2021 under the January Regulations).

In January 2021, the claimant requested that the High Court make a declaration that it was satisfied that the ‘Rent Exception’ in the January Regulations applied so that it could enforce the writ of possession.

NB - Sub-paragraph 3 of regulation 2 of the January Regulations provides that the general suspension of evictions until 21 February 2021, as provided for under in sub-paragraph 1, does not apply -

(3) … where the court is satisfied that-

(a) the case involves substantial rent arrears; and

(b) the notice, writ or warrant relates to an order for possession made wholly or partly-

(i) …

(ii) on Ground 8, Ground 10 or Ground 11 in Schedule 2 to the Housing Act 1988…

* * * * *

Setting out the principal issue to be determined in the case, Master Dagnall says -

‘… the main question before me is whether the Rent Exception only applies where (as the tenant Defendants contend) the Possession Order was made on grounds which wholly or partly were based on non-payment of rent or whether it can also apply (as the landlord Claimant contends) where the Order for Possession was made solely on a different basis. While the words actually used in the January Regulations support the Defendants' case, the Claimant contends that that construction is discriminatory for human rights purposes and that I should read the January Regulations in a modified way to accord with the Claimant's contentions.’ (paragraph 2)

Construction and application of Rent Exception in the January Regulations

Master Dagnall highlights that the order for possession did not rely on the rent-related grounds under the 1988 Act, as required in order for the claimant to rely on the Rent Exception under the January Regulations -

‘In the light of the history which is set out above, it seems to me clear that while the Claimant had applied to rely on ‘rent’ Grounds, DDJ Rea refused that application and made the Order for Possession simply on the basis of Section 21 and as the Order for Possession itself states.’ (paragraph 23)

Having taken account of the government’s explanation of the policy intention behind the Rent Exception, as set out in the accompanying explanatory memorandum and from debates in Parliament, Master Dagnall reaches the conclusion that -

‘… if the January Regulations are to be read, construed and given effect according to their literal wording then I should not be ‘satisfied’ that the Rent Exception applies. That is because even though there are Substantial Arrears (and the evidence demonstrates more than £70,000 being at least 18 months' worth of arrears) the Order for Possession was not made ‘wholly or partly… on any of Grounds 8, 10 or 11’. It was made under (or more accurately in consequence of) Section 21 and:

i) The Application to Amend had not been pursued before DDJ Rea, and so that while there was a claim for rent arrears there was no claim for possession on any Ground based on non-payment of rent

ii) DDJ Rea framed the Order for Possession itself so as to state that it was made in consequence of Section 21.’ (paragraph 47)

Interference with the landlord's rights under the European Convention on Human Rights

Moving on to consider whether the January Regulations interfere with the claimant's rights under the European Convention on Human Rights, Master Dagnall says that -

‘Ms Barden [counsel for the claimant] submits that the effect of the January Regulations is to interfere with the Claimant's property rights [under Article 1 of the First Protocol to the Human Rights Convention (A1P1)], and in particular the Order for Possession, and court-ordered right to have possession of the Property. However, she accepts that the circumstances of the pandemic justify this in general, but she goes on to submit that this is only the case in relation to interference which is not ‘discriminatory’ relying on Article 14 of the Convention.’ Paragraph 52)

While Master Dagnall expresses some doubts as to whether it is appropriate in this case to engage section 3 of the Human Rights Act 1998 to consider the compatibility of the January Regulations with the Convention, he decides to do so, accepting that the January Regulations interfere with the existing Order for Possession and associated rights and thus with the claimant's A1P1 rights, and may also operate in a discriminatory fashion on the claimant.

However, Master Dagnall then considers if any discriminatory effect is justified and reaches the conclusion that there is a legitimate aim to justify the difference in treatment of possession cases founded on Grounds 8, 10 and 11 and those founded on Section 21 -

‘For the tenant then to continue, after having been ordered to give up possession due to non-payment of rent, to be allowed simply have Substantial Arrears continue to arise or remain can be properly seen to amount to a defiance of the law and the Order for Possession and to be both egregious and to affect the integrity of the residential market. It is simply building on the existing wrong.’ (paragraph 76)

‘It seems to me, though, to be legitimate to see an Order for Possession based on Section 21 to fall into a different category. The basis of such an Order is simply a matter of a Landlord's choice, for whatever reason (and the court will not have been concerned with the reason which is irrelevant) to deprive the Tenant of their home. It has no necessary connection with any rent arrears. However, it may not seem so egregious (although wrong) for a tenant in those circumstances (especially in the light of the pandemic and its effects) to cease paying rent and to allow Substantial Arrears to build up. That does not seem to me to potentially affect the integrity of the residential market in the same way or to the same extent.’ (paragraph 76)

As a result, Master Dagnall holds that any discrimination is ‘justified’ and the January Regulations are compliant with Convention Rights.

Finally, Master Dagnall holds that, even if there is unjustified discrimination, it would not be possible to read in the words which the claimant wanted in the Rent Exception to support their case -

‘… both because that is against the thrust (or grain) of the legislation and would involve an impermissible venture of the court into what is the area of the legislator.’ (paragraph 88)

* * *

Accordingly, Master Dagnall makes the declaration that he is not ‘satisfied’ that the Rent Exception applies so that the claimant is therefore unable to enforce the eviction while the January Regulations remain in force.

NB - in dealing with this case, Master Dagnall also comments on certain procedural issues relating to applications linked to executing writs under the January Regulations, including the observation that -

‘The Claimant's Application asks for this Court to grant ‘permission to execute the Writ of Possession’. I do not regard that as a correct formulation of the relevant power of ‘the court’. The January Regulations provide that the eviction process cannot continue except ‘where the court is satisfied’ of the existence of an Exception. It therefore seems to me that the question is simply whether the court is so ‘satisfied’ and that the means by which the court should express its satisfaction (if it so satisfied) is by way of a declaration. The court is not granting any permission, although I suppose it could direct the relevant statutory officer to proceed in those circumstances.’ (paragraph 37)

Decision in full

[2021] EWHC 283 (QB)

Date of decision

11 February, 2021

Jurisdiction
  • High Court