Gargett, R (on the application of) v London Borough of Lambeth

Discretionary housing payments are not confined to cases where an applicant has a current shortfall between housing benefit and eligible rent. Where the statutory conditions are met, a local authority may exercise its discretion to award a payment for past housing costs, including rent arrears, even though the applicant currently receives full housing benefit and council tax benefit.

The amount remains subject to the cap imposed by regulation 4 of the Discretionary Financial Assistance Regulations 2001. The authority must reconsider the application according to the correct construction of the regulations.

The appellant, an assured tenant, accumulated rent arrears after rent increases were not notified to the local authority, with the result that the housing benefit paid did not initially cover her full entitlement. By the time of her application, she was receiving full housing benefit and council tax benefit.

She applied for a discretionary housing payment to meet the arrears. The authority refused on the ground that it had no discretion to make a payment where current benefits covered the eligible rent. The Administrative Court dismissed her judicial review claim: [2008] EWHC 663 (Admin). The issue on appeal was whether the Discretionary Financial Assistance Regulations 2001 permitted a payment for past rent arrears in those circumstances.

1. The appeal was allowed. The Administrative Court’s order was set aside, the authority’s decision was quashed, and the application was remitted to the authority for fresh consideration. Costs were awarded to the appellant, subject to detailed assessment.
2. The statutory scheme requires the applicant to be entitled to housing benefit or council tax benefit and to appear to require further assistance, in addition to those benefits, to meet housing costs. Rent arrears are capable of being housing costs. They are not among the liabilities expressly excluded by regulation 3 of the Discretionary Financial Assistance Regulations 2001.
3. Regulation 5 gives the authority a wide discretion as to the past or future period for which a payment may be made. A payment for a past period may therefore take the form of a lump sum.
4. Regulation 4 limits the amount of the payment, whether paid as a lump sum or periodically. The words referring to calculation as a weekly sum concern the method of calculation, not the form of payment. The relevant limit is calculated by reference to eligible rent, after the prescribed deductions, with housing benefit already paid for the relevant past housing costs also deducted so that the payment remains further assistance for costs not already met.
5. The regulations do not expressly, or by proper construction of regulations 2(1)(b) and 4, impose a requirement that there be a continuing current shortfall. Current receipt of full housing benefit and council tax benefit therefore does not remove the authority’s discretion to make a payment for past rent arrears. The authority had misdirected itself by treating that circumstance as determinative.
6. Wall LJ agreed in full with Mummery LJ’s reasoning and orders. Toulson LJ agreed with both judgments.

1. Court of Appeal (Civil Division) — Appeal from the Administrative Court; permission granted, appeal allowed, the lower court’s order set aside, and the local authority’s decision quashed.
2. Administrative Court — Sir George Newman, sitting as a Deputy High Court Judge, dismissed the judicial review application on 8 April 2008: [2008] EWHC 663 (Admin).