Westfields Construction Ltd v Lewis

For the purposes of the residential occupier exception in section 106 of the Housing Grants (Construction and Regeneration) Act 1996, occupation is not determined by a single snapshot at the date of contract. It is an ongoing condition, requiring consideration of the employer’s occupation and intention before, at and after formation of the contract. The employer must occupy, or intend to occupy, the dwelling as a residence. The exception does not apply where refurbishment works are undertaken so that the property can be let commercially. The assessment is objective and should be approached with common sense.

The claimant contractor sought summary judgment to enforce an adjudicator’s decision requiring the defendant employer to pay £17,393.91 plus interest. The defendant challenged the adjudicator’s jurisdiction, relying on section 106 of the Housing Grants (Construction and Regeneration) Act 1996. He argued that the contract principally related to works on a dwelling which he occupied, or intended to occupy, as his residence.

The central issues were when the construction contract was formed, whether the defendant occupied the property as his residence at that time, and whether he intended to occupy it after the works. The defendant contended that he intended to let the property after refurbishment; the claimant maintained that the residential occupier exception did not apply.

1. Application granted. The defendant’s jurisdictional challenge failed, and summary judgment was entered for the claimant for £17,393.91 plus interest. Costs were to be dealt with separately.
2. The contract was formed on 21 February 2012, when the parties met and agreed outstanding matters concerning the scope and price of the works. The earlier quotation formed the contractual basis but was not accepted as it stood.
3. Section 106 protects ordinary householders who occupy, and will continue to occupy or intend to occupy, the relevant property as their home. The word “occupies” reflects an ongoing state and cannot be tested solely by reference to a snapshot at contract formation. Evidence before and after the contract may therefore be considered.
4. The defendant’s intention is assessed objectively. The evidence showed a consistent intention to let the property after completion, including pre-contract discussions, dealings with prospective tenants, the purchase of another home and repeated contemporaneous emails. He therefore neither intended to occupy the property as his residence nor remained in ongoing residential occupation.
5. That conclusion was sufficient to dispose of the section 106 defence. Alternatively, even if occupation were assessed only at contract formation, the defendant had not proved on the balance of probabilities that he occupied the property as his residence on 21 February 2012.
6. The court observed that a person moving out in order to let or sell a property should not obtain the protection of section 106 merely because he lived there on the precise date of agreement.

First-instance enforcement proceedings in the High Court (Technology and Construction Court). The adjudicator’s decision dated 2 October 2012 required payment of £17,393.91 plus interest. The court enforced that decision.