Ryan v London Borough of Islington

Under the Housing Act 1985, matters relating to the grant in the right-to-buy completion scheme concern conveyancing matters about the lease or conveyance. They do not include outstanding disrepair or structural works. A tenant cannot therefore insist on pre-completion repairs as a condition of preserving the right to buy.

Notice periods are assessed objectively when served. A damages claim for loss of a later right-to-buy purchase caused by breach of repairing covenants fails where that loss was outside the kind of responsibility assumed when the tenancy began.

Emma Ryan, a secure tenant of a council flat, accepted an offer under Part V of the Housing Act 1985 to buy a long lease. Subsidence affecting a rear addition was discovered before completion, but the underpinning works were not carried out before the landlord served notices to complete.

The Central London County Court dismissed her claim for a declaration that her right to buy remained exercisable and her alternative damages claim. It awarded damages and ordered specific performance in relation to disrepair, matters not challenged on appeal. The central issues were whether the outstanding structural works were matters relating to the grant, whether the notice periods were reasonable, and whether the loss of the right to buy was recoverable as damages.

Lord Justice Rimer gave the judgment. Lord Justices Aikens and Waller agreed. The appeal was dismissed.

1. Non-disclosure of subsidence. The court assumed, without deciding, that the subsidence was a structural defect which should have been described in the section 125 notice. Ms Ryan knew of the defect when she accepted the offer, did not seek a revaluation under section 128, and sought to enforce rather than set aside the offer. Any right arising from the omission was therefore waived or irrelevant to her claim.
2. Meaning of matters relating to the grant. The phrase in sections 138 and 140 of the Housing Act 1985 referred naturally to conveyancing matters relating to the lease or conveyance. It did not extend to the physical condition of the flat, disrepair, or structural deficiencies. Milne-Berry v. London Borough of Tower Hamlets (1996) 28 HLR 225 and (1997) 30 HLR 229 provided no assistance because the issue had not been decided. The observation in O’Byrne v. Secretary of State for the Environment, Transport and the Regions v. Croydon London Borough Council (2002) 30 HLR 566, paragraph 78, supported the conveyancing interpretation.
3. Part V contained no entitlement to defer completion until repairs or structural works had been carried out. The statutory scheme contemplated that repair obligations could continue after completion, with contributions regulated by Schedule 6. The hypothetical case of total destruction did not alter that conclusion.
4. The Recorder was entitled to reject the alleged assurance about the timing of the works. The notice periods were to be assessed objectively when served. The two notices allowed 112 days, and no cogent reason showed that the periods were unreasonable. Failure to comply with the second notice therefore resulted in the right-to-buy notice being deemed withdrawn.
5. Damages. The relevant question was not what the landlord could foresee after breach, but whether, when the secure tenancy was granted, the loss was of a kind or type for which the landlord ought fairly to be taken to have accepted responsibility. Loss arising from inability to complete a future right-to-buy purchase was outside that responsibility because the purchase was not in contemplation when the tenancy began. The damages claim accordingly failed.

• Court of Appeal (Civil Division): Appeal from the Central London County Court dismissed. [2009] EWCA Civ 578.
• Central London County Court: Ms Recorder Caroline Wright dismissed the right-to-buy declaration and damages claims, while making orders concerning admitted disrepair.