Opinion : Disrepair Despair for Landlords? Not Really. Read on for our why.

A Senior Circuit Judge, at Bristol County Court, has made a significant decision about track allocation. This article deals with the implications for landlords and tenants.  

What the Court’s decision was about

The tenant was asking the Court to allocate the claim to the fast track, whilst the landlord was asking for small claims track allocation.  This is a not unfamiliar situation in disrepair claims and neither party’s position or arguments appear to have been novel or surprising.

The key driving force for the familiar small claims/ fast track allocation argument, in disrepair claims, is costs.   

The tenant (and obviously her solicitors) were wanting fast track allocation because [Birmingham City Council v Lee* arguments aside], in the small claims track the tenant might have only recovered fixed costs and been left with no legal representation.  The landlord was wanting small claims allocation to keep costs down. 

What the decision said

The Court decided that the matter should be allocated to the fast track and gave the following guidance:- 

1. Independent Complaints Procedures and other forms of Alternative Dispute Resolution do not override a tenant’s right to litigate and are not relevant to issues surrounding track allocation decisions. 
2. Track allocation should not be influenced by a landlord’s financial position. 
3. Landlords can be subject to orders for specific performance for outstanding repairs even where the landlord is either willing to, or are trying their best to carry out repairs.  
4. Repair costs should be assessed objectively based on market value rather than the actual cost to a particular landlord. 

Why this case is significant

Whilst county court decisions are not binding, the decision is intended to provide guidance to judges at Bristol County Court.  Bristol is not an insignificantly sized city, with Bristol City Council alone letting around 38,000 social housing properties.  A significant number of tenants and landlords are therefore likely to be affected by the guidance given by the Judge in this case.   

It also seems predictable that other county court judges will look to the decision for guidance on how they should be approaching such track allocation disputes.  

Will there be an appeal?

To my mind, the strongest point for appeal might be in relation to what was said in relation to orders for specific performance.   

An order for specific performance is an equitable remedy which means that to be entitled to such an order, you must have ‘clean hands’.  I cannot see how a tenant who has prevented a landlord from carrying out works up until an allocation hearing (perhaps with the allocation hearing in mind) can be said to have an arguable claim for an equitable remedy.  The tenant will be in breach of the requirements of their tenancy agreement by failing to allow access upon reasonable notice being given.  Not only that but the tenant will have breached the contract to cynically preserve their right to an order for specific performance.  

I have not seen the judgment itself and what I have read sheds no light on why the landlord had been unable to do the works before the allocation hearing.   It may be that this was a case where the landlord’s inability to get the work done had nothing to do with the tenant or any other occupiers.  However, if access issues were what prevented the landlord from doing the works there could, in theory be an appeal with interventions from a number of social housing providers.   

Whatever happens appeal-wise, social housing providers, other landlords and tenants can still raise the usual arguments in relation to allocation and can still succeed with them, with a reasonable judge, the law and the circumstances of the case on their side.  

Why no one should despair with disrepair

This case was a rehearsal of age-old arguments and the Court’s approach was not unusual.  It said little or nothing more than housing law practitioners see ordinarily in allocations decisions. 

For landlords, the key to achieving low-cost outcomes remains the same:- 

• Ensure that staff at all levels and across the organisation are trained to understand how they can help to minimise the number or impact of claims.  

• Ensure that the processes of all departments reflect the important roles that all teams and team members play in minimising claims and their cost. 

• Where you are not liable, have effective legal representation that ensures that tenants are persuaded to abandon weak cases pre-litigation.  

• Where you are likely to be found to be liable have effective representation that will settle pre-litigation or as quickly as possible, when the cost of settlement will be lowest.  

• Have a clear, precise and effective strategy for getting works done when letters of claim arrive, with a view to having the works done before the allocation hearing.  

• Ask the other side for a stay for negotiations pre-allocation.  If they don’t agree, ask the Court to order a stay, particularly where there have been no negotiations or inadequate negotiations.   

And for both landlords and tenants, the upside to fast-track allocation is that tenants can access representation.  Shoddy tenant representatives aside, this isn’t a bad thing for landlords.  Cases can be far more time consuming and more costly with an unrepresented tenant acting in person.  

Contact our Social Housing Litigation Team for free training for your teams, for a review of your repairs processes and procedures or for a bespoke disrepair claims handling package that will minimise the amount of money and time that your organisation spends on disrepair claims. 

Our Social Housing Litigation Team has over a decade’s experience and a proven track record of advising some of the largest to some of the smallest Registered Provider landlords in relation to:- 

• Drafting policies and procedures to ensure that staff at all levels and across the organisation are taking steps to minimise the number or impact of claims.  

• Training heads of service, income officers,  cyclical and day-to-day repairs teams, contractors and other housing officers, to ensure that staff at all levels are taking steps to minimise the number or impact of claims.  

• Strategies for getting works done when letters of claim arrive, with a view to having the works done before the allocation hearing.  

• Disrepair claims handling.  

We work in partnership with Registered Provider clients to become symbiotic with their internal teams and deliver bespoke claims handling packages with a proven track record of significantly reducing disrepair claims turn around times and cost.  A registered provider client with over 30,000 properties says: –  

“Through working collaboratively with Justine, we have established an effective approach to handling and processing disrepair claims which ensures compliance with the disrepair protocol, whilst generating significant savings in cost, time and resources for the client. The effectiveness of the relationship between us has produced fantastic results in reducing the average claim time from 159 days down to 36.5 days.” 

Justine Hunkins, Head of Social Housing Litigation 

Chadwick Lawrence LLP 

Contact: 07920 56 69 65