Miss Kaur v Birmingham City Council

This claim concerned a preliminary issue as to whether Miss Kaur (the claimant) occupied a property under a tenancy or a licence. Seeing as this was a housing condition/disrepair claim, if the court found the claimant occupied the property under a tenancy, then provisions under section 9A and 11 Landlord and Tenant Act 1985 and section 4 Defective Premises Act 1972 would apply. Otherwise, there would be no implied terms for fitness for human habitation or any repairing obligations. 

Background

The property was privately owned, but Birmingham City Council (the defendant) had a licence to use the property as temporary accommodation for homeless applicants. The claimant made an application to the defendant claiming that she, her partner and three adult children were homeless and in need of accommodation. The defendant considered that the claimant was owed a duty under the Housing Act 1966 and secured emergency accommodation for her and her family. 

The claimant instructed solicitors to issue a disrepair claim on 25 November 2021, alleging that in breach of implied covenants, the defendant failed to remedy defects in the property. The defendant defended the claim, stating the claimant occupied the property under a licence and not as a tenant under a lease. They therefore claimed that there were no repairing obligations under the Landlord and Tenant Act 1985. 

The claimant asserted that she had exclusive possession of the property for a fixed or periodic term in return for weekly payment and therefore occupied the property as a tenancy under a lease. The defendant denied that there was any right to exclusive possession of the property. 

Findings

The court noted that the occupancy agreement was poorly drafted and used terminology consistent with the grant of a lease and at other times, with the grant of a licence. It was therefore not of great assistance in determining whether it was a licence or a tenancy.  

The claimant asserted it was a tenancy, the defendant said a licence. 

The court held:

• The agreement did permit the defendant to put other people in the accommodation, even if they did not do this in practice. 
• The agreement did allow the defendant to move the claimant to other accommodation, which was inconsistent with granting exclusive possession. It also allowed the defendant to ‘change the agreement’ so another address could have been submitted. There was no requirement in law to terminate the agreement and grant a new one.
• The agreement reserved to the defendant control over who could live or stay overnight at the property, how long the claimant could be away from the property and the power to terminate the agreement how and when they wished.

The court held that all of the above points were inconsistent with the grant of a right to exclusive possession. Further, however, the defendant’s limited right to enter the property under the agreement was consistent with the grant of exclusive possession.

The court observed that historic cases had used the wording ‘exclusive occupation’ in contexts where what was meant was ‘exclusive possession’. The court found that exclusive occupation alone does not equate to exclusive possession.

His Honour Judge Najib was satisfied that the claimant merely enjoyed exclusive occupation of the property as a matter of fact rather than law and that the parties intended that the defendant should and would retain legal possession and control over the property.

The agreement was found to be a licence and this case is now being appealed.

Key takeaways

Exclusive occupation is a necessary element for, but not conclusive of legal exclusive possession. 

In determining whether an agreement is a licence or tenancy:

• Does the agreement effectively provide for legal exclusive possession in its terms?
• Irrespective of whether on the face of the agreement it is called a licence or a tenancy, what are the intentions of the parties and the facts of occupation?

This case emphasises again the importance of clear, certain and unambiguous wording within occupancy agreements, so that it is clear to all parties the basis on which accommodation is offered. 

In light of the findings of this case, please contact me if you would like assistance in reviewing your occupation agreements to ensure that they are fit for purpose.