Case Note: McDonald (by her litigation friend Duncan J McDonald) (Appellant) v McDonald and others (Respondents) [2016] UKSC 28

June 16, 2016

By John Waiting

Judgment handed down: 15 June 2016

Summary

Where a private sector owner brings a claim for possession against a residential occupier, a court is not required to consider the proportionality of evicting the occupier in the light of section 6 of the Human Rights Act 1998 (“HRA”) and article 8 of the European Convention on Human Rights (“the Convention”).

Facts

The Appellant suffers from a personality disorder. Her parents purchased a property as a home for her with the assistance of a loan secured by a registered legal charge. The parents granted the Appellant a series of Assured Shorthold Tenancies (“AST”). The payments on the loan were not made as they fell due and the lender appointed receivers. The receivers served a section 21 notice seeking possession of the property, and thereafter issued proceedings for possession of the property in the name of the parents.

Decisions of the Courts below

At first instance, the Judge held that the court was not required to consider the proportionality of making an order where the person seeking possession was not a public authority, but had he been entitled to consider proportionality he would have concluded the claim was disproportionate and dismissed the claim. The Court of Appeal dismissed the appeal. The Appellant appealed to the Supreme Court.

Decision of the Supreme Court (Joint Decision of Lord Neuberger and Lady Hale, with whom Lord Kerr, Lord Reed and Lord Carnwath agreed)

The Supreme Court considered three questions: [1]

  1.  Whether a court, when entertaining a claim for possession by a private sector owner against a residential occupier, should be required to consider the proportionality of evicting the occupier, in the light of section 6 of the HRA and article 8 of the Convention.
  2. Whether, if the answer to the first question is yes, the relevant legislation, in particular section 21(4) of the Housing Act 1988, can be read so as to comply with that conclusion.
  3. Whether, if the answer to the first and second questions is yes, the trial judge would have been entitled to dismiss the claim for possession in this case, as he said he would have done?

The first issue: can the appellant rely on proportionality?

The Appellant argued that the Court as a public authority should be obliged to uphold the rights set out in the Convention, and therefore the Court should have to balance the Appellant’s Article 8 rights against the Landlords Article 1 of Protocol rights in considering whether it would be proportionate to make the possession order and if so what terms to include in the order. [38] The Court rejected this argument, as:

  • Parliament has enacted legislation that balances these rights. [40]
  • To hold otherwise would be to give direct effect to the Convention between private citizens and alter their contractual relationship. [41]
  • Article 8 would only be engaged when a private landlord when the landlord enforced his/her rights through the court, rather than taking the law into his/her own hands – a perverse incentive in those cases where peaceful physical eviction was not prevented by the Protection from Eviction Act 1977. [42]
  • Consistency of application and certainty of outcome of rules set down by the state for general application are two essential ingredients of the rule of law.[43]
  • The Government’s approach to the private rented sector is to provide some protection for tenants, but not so much protection that private individuals are deterred from making properties available for letting. [45]
  • The Court distinguished between cases where the Court was required to balance conflicting convention rights, where the legislature has expressly or impliedly through inaction left the Court to carry out the balancing exercise, and cases such as this where the legislature had prescribed how the competing Convention rights are to be respected within a contractual relationship. [46]
  • The Court considered a number of authorities within the Strasbourg Jurisprudence, but found that “while we accept that the Strasbourg court jurisprudence relied on by the appellant does provide some support for the notion that article 8 was engaged when Judge Corrie was asked to make an order for possession against her, there is no support for the proposition that the judge could be required to consider the proportionality of the order which he would have made under the provisions of the 1980 and 1988 Acts.” [48-59]

The Court did not have to make decisions as to the second and third issues in order to determine the appeal, however it did so as the second issue was relevant to the application of the HRA more generally and the third issue was relevant to possession claims by public sector land owners, where a court could consider an article 8 proportionality argument raised by a residential occupier.

The second issue: could section 3 of the Human Rights Act 1998 (“HRA”) have applied?

Section 3 HRA states: “So far as it is possible to do so, primary legislation and subordinate legislation must be read and given effect in a way which is compatible with the Convention rights.”

  • The Court held that to read s21(4) in such a way to include a proportionality assessment would amount to amendment, rather than interpretation. It is an essential part of the AST legislation that landlords should have certainty that they can obtain possession by giving notice. [69]
  • The Court stated that had it been persuaded that section 21(4) was incompatible with Convention Rights the only remedy would have been a declaration of incompatibility under s. 4 HRA and whether and how to remedy any incompatibility would be left to parliament. [70]

The third issue: would the judge have been entitled to dismiss the claim?

  • The Court stated: “Were a proportionality defence to be available in section 21 claims, it is not easy to imagine circumstances in which the occupier’s article 8 rights would be so strong as to preclude the making, as opposed to the short postponement, of a possession order.” [73]
  • Whilst the Court described the Appellant’s circumstances as “most unfortunate” it was difficult to see how these could justify postponing indefinitely the lender’s right to be repaid. [74]
  • Six weeks’ suspension of the possession order was the best the Appellant could have hoped for in the circumstances of the case, if a proportionality assessment had been made. [75]

Comment

In Malik v Fassenfelt [2013] EWCA Civ 798, Sir Alan Ward gave a valedictory judgment stating that in a claim by a private landowner against trespassers the court should undertake a proportionality assessment if there was a seriously arguable case. Whilst this judgment was obiter, it appears to have been followed in Manchester Ship Canal Developments Ltd v Persons Unknown [2014] EWHC 645 (Ch), and the proposition was not challenged by the claimant landowner in Hampson v Runnymede Orchid Ltd (unrep). Therefore, there has been some tacit support for the requirement of a proportionality assessment in possession proceedings concerning private citizens.

In McDonald v McDonald, the Supreme Court has clarified the law in relation to claims by private residential landlords. The judgment sets out the legislative history of housing legislation since the 1970s, and emphasises the political decision to improve the number and quality of houses made available for rent by private citizens, by limiting security of tenure, and giving landlords certainty that they can obtain possession relatively simply.

Whilst private residential landlords will be relieved at this decision, the Deregulation Act 2015 contained some limited measures to increase the protection available to tenants and there have been increases to the Stamp Duty Land Tax treatment of second homes. It will be interesting to see whether the government will make more interventions into this area given the expansion of the private rental market sector since the 1980s and the demand for home ownership, the government recognising that buy-to-let investors crowd out first time buyers.

 

Case note prepared by John Waiting. John is a member of our Commercial Department. He will be giving a talk about this decision as part of the Property Seminar on Tuesday 21 June in Liverpool. Contact Jo Stapley for more information or to reserve your place.

Back to News