Basildon District Council v Wahlen

When a local authority’s possession claim and a secure tenant’s right-to-buy claim concern the same home, the right to buy does not automatically prevail merely because the statutory conditions for grant have been met. The court should usually hear both claims together and conduct a fact-sensitive balancing exercise. Relevant matters include the tenant’s established home, disruption and financial consequences, the genuineness of the purchase, tenancy breaches, nuisance, under-occupation and the authority’s practical housing needs. No factor is predetermined to decide the result. Loss of housing stock caused by the right to buy cannot itself defeat the tenant’s claim. The judgment must explain the weighing process sufficiently to permit meaningful appellate review.

A secure tenant succeeded to a local authority tenancy after his mother’s death. The authority sought possession under Ground 16 of Schedule 2 to the Housing Act 1985 on under-occupation grounds. The tenant had notified the authority that he wished to exercise the right to buy and counterclaimed for an injunction compelling the grant of the freehold. The District Judge dismissed the possession claim and granted the injunction, treating compliance with section 138(1) as decisive. The authority appealed on the proper method of resolving the competing claims.

1. Appeal allowed. The District Judge’s decision could not stand because he treated fulfilment of section 138(1) as decisive and conducted no balancing exercise. The matter was remitted to the County Court for a retrial before a different judge.
2. Procedural approach. Section 121(1) of the Housing Act 1985 gave no priority to the possession claim, while section 138(1) was silent on the effect of outstanding possession proceedings. Bristol City Council v Lovell [1996] 1 All ER 775 established that the conflict was not to be resolved by a race to judgment or execution. The court should ordinarily hear both claims together. Separate sequencing is appropriate only where one claim is properly hopeless or the possession case could not properly succeed. Doubt as to the appropriate sequence ordinarily requires both claims to be heard.
3. Balancing exercise. The court must assess the particular evidence. Relevant matters may include the length and continuity of the tenant’s occupation, whether the property is his only home, the importance of remaining or acquiring it, disruption caused by moving, the financial significance of the discount, the genuineness and viability of the right-to-buy claim, serious or persistent breaches, nuisance, under-occupation and the authority’s genuine practical need to deploy its housing stock. The guidance in Kensington and Chelsea Royal London Borough Council v Hislop [2004] 1 All ER 1036 was useful, but no factor should be treated as likely to tip the balance in advance. Enfield London Borough Council v McKeon [1986] 1 WLR 1006 confirmed that the injunction claim remains relevant even where serious behaviour allegations are made.
4. Ground 16 and Part V. Under-occupation and better practical use of housing stock may support possession under Ground 16. However, the authority cannot rely on the consequent loss of the property from its housing stock to defeat the right to buy, since that loss is a consequence of the policy of Part V. The creation of an enfranchised pocket ordinarily carries little weight. The fact that the tenant invoked the right to buy after possession was intimated was not itself adverse, although it might provide a limited indication of the importance attached to purchase.
5. A judgment resolving the competing claims must give sufficient reasons to show how the relevant factors were weighed. Without such reasoning, meaningful appellate review is impossible. Moses LJ agreed with Neuberger LJ.

• Court of Appeal (Civil Division). Allowed the authority’s appeal and remitted the proceedings for a retrial before a different judge: [2006] EWCA Civ 326.
• Basildon County Court. On 6 September 2005, District Judge Chandler dismissed the possession claim and granted the tenant an injunction enforcing his right to buy.