Malik v London Borough Of Richmond Upon Thames

A service-provider agreement under which a local authority pays for accommodation supplied to occupants is not thereby a tenancy granted to the authority. The court must construe the agreement in its context, including identifying who was intended to occupy the premises and whether exclusive possession was granted. An appellate court will not interfere with primary findings of fact based on witness assessment absent cogent documentary or equivalent evidence. Contractual damages remain subject to the duty to mitigate loss. Interest on damages is discretionary, and permission to appeal may be refused where the proposed appeal is disproportionate to the sum at stake.

The claimant supplied accommodation to asylum-seeking immigrants under a Service Provider Agreement with the defendant council. The county court awarded approximately £5,500 in damages for breach of that agreement, but awarded no interest. The claimant renewed an application for permission to appeal on grounds concerning the construction of the service agreement, the effect of an assured shorthold tenancy, termination, evidence, mitigation, and interest.

The central issues were whether the agreement was a tenancy in favour of the council, whether it had been properly terminated, whether the trial judge could reject aspects of the claimant’s evidence, whether uncashed housing-benefit cheques affected mitigation, and whether permission should be granted on the interest issue.

1. Permission to appeal refused. The proposed grounds were unarguable or insufficiently connected with the issues decided below.
2. The Service Provider Agreement was not a tenancy granted to the council. Properly construed in context, it required the claimant to permit immigrants to occupy the property while the council paid an agreed amount per occupant. It did not grant the council exclusive occupation. Reliance on Street v Mountford was therefore based on a complete misunderstanding of that authority.
3. The assured shorthold tenancy agreement between the claimant and the head of the immigrant family was valid and created a landlord-and-tenant relationship. This issue substantially failed with the tenancy-construction ground.
4. Although the Service Provider Agreement contained no effective termination provision for the council, a term requiring one month’s notice was properly implied. The council’s letter of 27 August clearly indicated that it would make no further payments. That amounted to repudiation, for which damages were recoverable, but the damages were limited to the period covered by proper termination on one month’s notice.
5. The Court of Appeal would not interfere with the trial judge’s primary assessment of the claimant’s credibility. No cogent documentary evidence or equivalent material demonstrated error. In any event, the credibility finding did not affect the construction and termination issues.
6. The housing-benefit cheques were relevant to mitigation, not set-off. By declining to cash them, the claimant failed to mitigate his loss.
7. The award of interest was discretionary. In the absence of a record of the submissions or reasoning below, permission could not properly be granted. The small amount involved and the overriding objective also made an appeal on interest disproportionate.

• Court of Appeal (Civil Division): On 10 October 2001, Sir Murray Stuart-Smith refused the renewed application for permission to appeal.
• Wandsworth County Court: On 19 June 2001, His Honour Judge Walker awarded the claimant approximately £5,500 in damages but no interest.