Eastleigh Borough Council v Walsh

Temporary accommodation provided by a local housing authority under the homelessness legislation may be let as a tenancy. Its temporary purpose does not convert an agreement granting exclusive possession on unambiguous tenancy terms into a licence.

Paragraph 5 of Schedule 3 to the Housing Act 1980 expressly contemplated a tenancy granted under the relevant provisions of the Housing (Homeless Persons) Act 1977. Such a tenancy was initially excluded from security of tenure, but could become secure after the statutory period following notification. Section 48 of the 1980 Act applied only where a licence, if it had been a tenancy, would have been secure. It did not apply to an initially non-secure tenancy within paragraph 5.

A local authority offered a homeless applicant a three-bedroom house pending further inquiries. Its documents described the arrangement as a tenancy, granted exclusive possession, required weekly rent and prescribed four weeks' written notice for termination.

After discovering that the applicant's wife and children were living elsewhere, the authority notified him that he did not qualify for accommodation and sought possession on the basis that he was a licensee. It never served the contractual notice required to determine a tenancy. The Southampton County Court made a possession order on 17 May 1984, and the Court of Appeal upheld that order on 19 November 1984.

The central issue before the House was whether the original arrangement created a tenancy or merely a licence and, consequently, whether the applicant had acquired a secure tenancy under the Housing Act 1980.

1. Appeal allowed unanimously. Lord Bridge of Harwich delivered the leading speech. Lord Scarman, Lord Keith of Kinkel, Lord Brightman and Lord Templeman agreed with his reasons. The Court of Appeal's order was reversed and the Southampton County Court's possession order was set aside.

2. Per Lord Bridge, the applicant received exclusive possession under contemporaneous and unambiguous documents comprising an offer of a tenancy, a signed key receipt referring to the tenancy, and accepted conditions of tenancy. There was no factual question on which the occupation could properly be characterised as a licence. Its temporary purpose and the parties' understanding of the homelessness context could not displace the legal effect of those documents.

3. Paragraph 5 of Schedule 3 to the Housing Act 1980 expressly referred to a tenancy granted pursuant to sections 3(4), 4(3) or 5(6) of the Housing (Homeless Persons) Act 1977. It therefore contradicted the proposition that Parliament could not have intended temporary accommodation under those provisions to take the form of a tenancy. Such a tenancy was initially non-secure but became secure after the prescribed period following statutory notification unless it had first been determined.

4. Per Lord Bridge, section 6(1) of the 1977 Act principally addressed the methods by which an authority could perform its obligations under sections 4 and 5. It did not restrict the authority's power to let residential property held under Part V of the Housing Act 1957. In particular, it did not qualify the letting power conferred by section 104(3), as substituted by section 91 of the 1980 Act.

5. Section 48 of the 1980 Act applied only where a licence would have been a secure tenancy if granted as a tenancy. It had no application to paragraph 5 tenancies, which were not secure when first granted. It could not justify construing the express reference to a tenancy in paragraph 5 as a reference to a licence.

6. The authority failed to serve the contractual four weeks' notice while the tenancy remained non-secure. The tenancy consequently acquired security after the statutory period. The cause was remitted to the Southampton County Court, and the authority was ordered to pay the applicant's costs in the House and the courts below.

1. House of Lords: The appeal was allowed unanimously. The Court of Appeal's order was reversed, the county court's order was set aside, and the cause was remitted.

2. Court of Appeal: On 19 November 1984 the court upheld the possession order, concluding that the occupation was an exclusive licence rather than a tenancy.

3. Southampton County Court: On 17 May 1984 Judge Starforth-Hill held that the temporary accommodation had not been intended to create a tenancy and made an order for possession.