Lisa Paley v The London Borough of Waltham Forest

Under the Housing Act 1996, a local authority must assess the affordability of offered accommodation objectively and by reference to the particular applicant’s and household’s needs. The assessment must account for reasonable living expenses and essential needs, including transport and relevant liabilities, and must consider the effect of a benefit cap. An applicant must have an opportunity to provide information, but direct participation in preparing the authority’s budget is not a legal precondition. Nor does failure to challenge figures make an inadequate assessment lawful. A budget which omits objectively reasonable expenditure is irrational, even if the offered accommodation is less unaffordable than existing accommodation.

This was a second appeal from the County Court at Stoke on Trent, where HHJ Rawlings dismissed Ms Paley’s appeal against the local authority’s decision to discharge its main homelessness duty by offering a private rented property in Stoke-on-Trent. The property was about 161 miles from Waltham Forest. Ms Paley challenged the adequacy of the local authority’s inquiries concerning location and affordability. Permission to appeal was granted on whether the review process satisfied the duty to make necessary inquiries and whether an affordability assessment could lawfully be prepared without the applicant’s direct input or specific challenge to the figures. The central issue was whether the offered accommodation was suitable and affordable for the applicant and her children.

Disposition. Lady Justice King, with Lady Justice Asplin and Mr Justice Francis agreeing, allowed the appeal on Ground 2 concerning affordability and dismissed Ground 1 concerning the adequacy of the inquiries into location.

1. An appeal under section 204(1) of the Housing Act 1996 is determined by applying judicial review principles. The reviewing officer decides what inquiries are necessary. Intervention is justified only where no reasonable local authority could have failed to regard further inquiries as necessary, having regard to the caution against imposing onerous duties on housing authorities.
2. The applicant’s representations in response to a minded-to letter form part of the inquiry process. They do not replace the authority’s own duty, but give the applicant a further opportunity to identify matters requiring investigation. The lawfulness of the assessment does not depend on the applicant’s direct input into the authority’s budget. On the facts, the location ground failed because the applicant had not mentioned any significant role played by the children’s father or identified a specific further inquiry which was necessary.
3. Suitability, including affordability, had to be assessed under the Homelessness (Suitability of Accommodation) Order 1996/3204 and the 2018 Code. The authority had to conduct an objective, evidence-based inquiry into the needs of the particular applicant and household, including reasonable living expenses and essential needs. It had to consider transport, relevant liabilities and the impact of the benefit cap. The approach in Samuels v Birmingham City Council [2019] UKSC 28 and Patel v London Borough of Hackney [2021] EWCA Civ 897 supported that approach.
4. The authority could not treat the assessment as lawful merely because Ms Paley had not challenged its figures. The budget omitted public transport costs and debt repayments and left an unitemised sum of £50 to cover clothing, transport, school requirements and other necessary expenditure. The reviewing officer had not critically engaged with the budget. No reasonable authority could objectively have concluded that the property was affordable. A property being less unaffordable than existing accommodation did not make it affordable.
5. Because the offered property was not suitable, the main housing duty under section 193(2) had not been discharged.

• Court of Appeal (Civil Division): The appeal was allowed on the affordability ground and dismissed on the reasonable-inquiries ground.
• County Court at Stoke on Trent: HHJ Rawlings dismissed Ms Paley’s appeal against the local authority’s review decision on 7 September 2020.