The effect of breach of a suspended or postponed possession order

The effect of suspended or postponed possession orders (e.g. with conditions that tenants pay current rent and a specified sum each week or month towards the arrears) depends on the type of tenancy and the wording of the order.  As a result of recent case law, the position is complex and the wording of orders needs to be considered very carefully.  [Note though Housing and Regeneration Act 2008 s299 and Sched. 11 which are not yet (December 2008) in force, but will, for most occupants, abolish the status of “tolerated trespasser”.]

(a) Orders made in Form N28 in use between 1993 and late 2001

The form of N28 introduced in 1993 and which commonly remained in use until late 2001, provided “The court has decided that unless you make the payments as set out in paragraph 3, you must give the plaintiff possession of [property] on [date].  Breach of the terms of a suspended possession order made in this version of Form N28 automatically brings a secure tenancy to an end.  The former tenant becomes a tolerated trespasser ((Burrows v Brent LBC [1996] 1 WLR 1448, HL).   In Thompson v Elmbridge BC [1987] 1 WLR 1425, CA the local authority granted a secure tenancy to Mrs Thompson. She lived in the property with her husband. After arrears of rent had accrued, the council took possession proceedings and, in January 1985, obtained an order for possession in Form N28 suspended on terms that the defendant paid current rent and a further £10 per week off the accrued arrears. In August 1985 Mrs Thompson left the premises, but her husband continued to live there. He was unemployed and although some rent was paid by the DHSS, further arrears accrued. In January 1986 the local authority applied for a warrant for possession. Mr Thompson claimed that the tenancy was still continuing and that he accordingly had rights of occupation under Matrimonial Homes Act 1983 s1 (now Family Law Act 1996 s30). He applied to the court to suspend the warrant of possession and for an order under Matrimonial Homes Act 1983 Sch 1 (now Family Law Act 1996 Sch 7) transferring the tenancy to him. The Court of Appeal, in dismissing Mr Thompson’s appeal against the refusal of his application, held that on the true construction of the order, the tenancy had come to an end on the first occasion when Mrs Thompson breached the terms of the suspended order by failing to pay current rent or installments towards the arrears on time.

If that form of suspended possession order is breached,

            n the tenant loses the right to buy (Housing Act 1985 s118);

            n the tenant loses rights to mutual exchanges (Housing Act 1985 s92);

            n the tenant loses the benefit of the landlord's repairing obligations (eg Landlord and Tenant Act 1985 s11);

            n the tenant's spouse loses rights to the transfer of the tenancy under Family Law Act 1996;

            n the tenant's spouse and/or other members of the family lose the right to succeed to the tenancy on death (Housing Act 1985 ss87-90);

If the occupant is still in possession it is possible to apply for a further suspension under Housing Act 1985 s85(2) or Housing Act 1988 s9(2), but that protection may be lost - see Leicester CC v Aldwinkle (1992) 24 HLR 40, CA. Suspended possession order in 1983. By 1988, the tenant was in breach of its terms as a result of non-payment following a period of illness. This breach brought her tenancy to an end. In early 1989, the ex-tenant, although often away from the property for hospital and other treatment, was in contact with the housing benefit department of the council in an attempt to get the arrears cleared in part by a backdated housing benefit claim. Despite this, in July 1989, the council applied for and obtained a warrant and executed the possession order by recovering possession in August 1989. The ex-tenant returned to her flat in November to find the property secured and all her possessions removed. She applied to have the warrant stayed or suspended. However, the power to suspend or stay is available only before actual execution of the order (Housing Act 1985 s85). The Court of Appeal held that (a) application without notice for a warrant was provided for by rules of court and use of the rules was not an abuse of process and (b) the court could not ‘write in’ to the rules a requirement for notice to cure a perceived breach of natural justice. Leggatt LJ, giving the judgment, urged that consideration be given to the introduction in the county court of an equivalent to RSC Order 46 r3 which requires that leave be sought before a possession order can be executed.

In such circumstances, the only remedies available to the ex-tenant are (a) to apply to set aside the original possession order (see eg CPR 39.3); or (b) to apply to set aside the warrant.  This can only be done if the warrant was obtained by fraud, or there has been abuse of process or oppressive conduct on the part of the plaintiff (Hammersmith and Fulham LBC v Hill (1995) 27 HLR 368, CA).   See below.

(b) Orders made in Form N28 in use between late 2001 and Spring 2006

The form of N28 introduced in late 2001 and which commonly remained in use until spring 2006, provided “the court orders that … the defendant give the claimant possession of [property] on or before [date].”  After further paragraphs ordering payment of rent and costs, it provided “This order is not to be enforced so long as the defendant pays the claimant the rent arrears and the amount for use and occupation [and costs] totaling £     by the payments set out below in addition to the current rent.”  The Form N28 itself described this as a “suspended” order and that was the general understanding until the decision in Harlow DC v Hall [2006] EWCA Civ 156; [2006] 1 WLR 2116.  In that case, the Court of Appeal held that this form of order in fact terminated secure tenancies and converted occupants into tolerated trespassers even if they complied with the terms of the order. 

(c) Orders made in revised Form N28 in Spring and Summer 2006 and thereafter

In view of Harlow DC v Hall, the Department for Constitutional Affairs (DCA) advised courts to delete paragraph 5 in Form N28 and to substitute a new paragraph 1 in Form N28 in the following terms

“1.  The defendant give the claimant possession of (address of the property) on or before (date) provided that the date for possession will be postponed and the defendant’s tenancy of the premises will continue, so long as the defendant pays the claimant the current rent and in addition the rent arrears and costs by the installments set out below.”

For secure tenants, the effect of this amendment is to revert to the pre-2001 position.  Secure tenancies continue provided that tenants comply with the terms of the order, but immediately on breach such tenants become tolerated trespassers.

(d) Postponed orders made from Summer 2006

In Bristol CC v Hassan; Bristol CC v Glastonbury  [2006] EWCA Civ 656; [2006] 1 WLR 2582 the Court of Appeal held that courts do not have to use Form N28 and sanctioned a form of postponed order which allows secure tenancies to continue even after breach of the terms of the possession order.  A modified version is now Form N28A (summarised above).  The importance of this form of postponed order is that it has the potential of virtually abolishing the status of “tolerated trespasser”.  Secure tenancies continue despite breach of the terms of an order in Form N28A.  If the tenant breaches the terms of an order in Form N28A and the landlord wants the court to fix a date for possession, the landlord can make an application to the court following a warning notice to the tenant.  That notice must be sent at least 14 days and not more than 3 months before applying for an order.  It must (1) state that the claimant intends to apply for an order fixing the date upon which the defendant is to give up possession of the property;  (2) record the current arrears and state how the defendant has failed to comply with the order (by reference to a statement of the rent account enclosed with the notice);  (3) request that the defendant reply to the claimant within 7 days, agreeing or disputing the stated arrears; and  (4) inform the defendant of his or her right to apply to the court for a further postponement of the date for possession or to stay or suspend enforcement.  The application to the court to fix a date can be made on a `without notice’ basis.

(e) The future

Housing and Regeneration Act 2008 s299 and Sched. 11 make significant amendments to Housing act 1985 (and Housing Act 1988).  As of December 2008 these provisions were not yet in force, but they will

(i)                  prevent the creation of any future “tolerated trespassers” by providing that secure tenancies only come to an end on execution of a warrant for possession; and

(ii)                converting most existing tolerated trespassers back into secure tenants.  Currently those tolerated trespassers whose homes have been subject to stock transfer (eg form local authority to housing association, after breach of a suspended possession order do not come within the new provisions, but the government is considering further amendments which may achieve this.

An alternative?

Housing Act 1985 s85(1)

            Where proceedings are brought for possession of a dwelling-house let under a secure tenancy on any of the grounds set out in Part I or Part III . . . the court may adjourn the proceedings for such period or periods as it thinks fit.

For these reasons, just as I always ask myself whether or not it is reasonable to make an absolute order, I also ask myself whether or not it is reasonable to make a suspended or postponed order (see  Laimond Properties Ltd v Raeuchle   (2001) 33 HLR  113, CA).  If I do not consider it reasonable I adjourn on terms.  If the tenant fails to comply with the terms, the local authority/housing association restores the action and, unless there are good reasons for the breach of terms, obtain a possession order.  Although I have no set rules, I am far more likely to adjourn on terms if the Defendant is in receipt of income support or other state benefits - in such circumstances the Benefits Agency credit the weekly payment towards the rent arrears quarterly in arrears with the result that the tenant automatically breaches the suspended possession order and becomes a trespasser.

Other points on reasonableness

If a defendant counterclaims unsuccessfully for breach of repairing obligations, in ordinary circumstances, it is not reasonable to make a possession order if the tenant has made arrangements, in the event of the failure of his counterclaim, for the early discharge of the arrears. However, in exceptional circumstances where there has been a bad history of persistent delay in paying rent, it may be reasonable to make an absolute order for possession - Haringey LBC v Stewart (1991) 23 HLR 557; [1991] 2 EGLR 252, CA

The proper approach in a case of the commission of "a most serious breach" of the tenancy agreement is that it will be reasonable to order possession in the absence of some exceptional circumstance - Bristol CC v Mousah (1997) 30 HLR 32, CA, (serious drug dealing) and Sandwell MBC v Hensley [2007] EWCA 1425; [2008] HLR 22 (outright possession order substituted on appeal for suspended possession order where tenant had pleaded guilty to a charge of being knowingly concerned with the cultivation of cannabis. It was said that where an individual commits a criminal offence, a possession order should only be suspended in exceptional circumstances where there is cogent evidence to demonstrate that the offender's particular conduct had ceased.)

The fact that anti-social behaviour was caused by the tenant’s children or other members of the family does not prevent the court from making an outright possession order (Kensington & Chelsea RLBC v Simmonds (1997) 29 HLR 507, CA, Northampton BC v Lovatt [1998] 07 EG 142, CA, Darlington BC v Sterling  (1996) 29 HLR 309, CA, Portsmouth City Council v Bryant (2000) 32 HLR 906, CA (claimant does not have to establish fault or even knowledge on part of tenant, but the extent of personal fault is relevant when considering reasonableness.), Manchester City Council v Higgins [2005] EWCA Civ 1423; [2006] HLR 14; and Knowsley Housing Trust v McMullen [2006] EWCA Civ 539; [2006] HLR 43. However an outright possession order may not be appropriate where the anti social behaviour was not caused by the tenant, but by a member of the tenant’s family who has since left the premises, with the result that the chances of recurrence are reduced. (Castle Vale Housing Action Trust v Gallagher  [2001] EWCA Civ 944, (2001) 33 HLR 810).

Where there is an admitted breach of covenant and an intention to continue with the breach a landlord should only be refused possession in a ‘very special case’ - Sheffield CC v Green (1994) 26 HLR 349, CA; cf Bell London & Provincial Properties Ltd v Rueben [1947] KB 157, CA).  It is in the public interest that necessary and reasonable conditions in tenancy agreements are enforced fairly and effectively Sheffield CC v Jepson (1993) 25 HLR 299, CA (tenant keeping a dog in breach of an express term of the tenancy agreement. Although there was little evidence about the defendant’s dog in particular, reasonable to make suspended possession order).  The availability of the power to grant an injunction restraining breach of the terms of a tenancy agreement is not a reason to make a suspended possession order rather than an outright order (Canterbury City Council v Lowe (2001) 33 HLR 583, CA.  In a case involving the parking of a caravan in a front garden in breach of the terms of a tenancy agreement, the Court of Appeal held that the propriety of the council’s policy was not a factor relevant to the exercise of discretion. The judge should not have been concerned with the propriety or impropriety of the policy rule. His concern should have been with the reasonableness in the particular case of ordering possession - Barking and Dagenham LBC v Hyatt and Hyatt (1992) 24 HLR 406, CA.  cf Wandsworth LBC v Hargreaves (1994) 27 HLR 142, CA (in breach of a term of the tenancy a visitor brought petrol into the flat to make petrol bombs, which were thrown from the window. A fire started in the flat from spilt petrol, causing £14,000 worth of damage.  The Court of Appeal dismissed the council’s appeal against a refusal of the county court judge to order possession.)

In nuisance cases, the authority's obligations towards other tenants should be borne in mind - Woking BC v Bystram (1995) 27 HLR 1, CA (nuisance continuing - appropriate course was to make a suspended order for possession on terms that any further nuisance would lead to repossession in 28 days).

A local authority's housing obligations towards the defendant if made homeless, and in particular the question of whether re-housing is likely to be refused as a result of intentional homelessness may have greater or lesser weight when considering reasonableness, depending on the circumstances - cf Rushcliffe BC v Watson (1992) 24 HLR 123, CA  (the prospect that, if evicted, the tenant would probably be found to be intentionally homeless a very real consideration); Bristol CC v Mousah (1997) 30 HLR 32, CA (whether the tenant would be rehoused as homeless was a matter for the council and not for the court); Darlington BC v Sterling (1996) 29 HLR 309, CA (a decision by a Circuit Judge that as a District Judge had formed the view that the tenant ought not to be roofless he should not have ordered possession unless the council could show it would provide suitable alternative accommodation overturned by the Court of Appeal); and Shrewsbury and Atcham BC v Evans (1997) 30 HLR 123, CA (The judge had not needed to consider how a tenant who had 'flagrantly and deliberately lied about her circumstances' in order to obtain council housing would be rehoused.)

Anti-Social Behaviour Act 2003 s16 introduced new

Housing Act 1985 s85A

Housing Act 1988 s9A

If the court is considering whether it is reasonable to make an order for possession on Ground 2 or Ground 14,

the court must consider, in particular-

(a) the effect that the nuisance or annoyance has had on persons other than the person against whom the order is sought;

(b) any continuing effect the nuisance or annoyance is likely to have on such persons;

(c) the effect that the nuisance or annoyance would be likely to have on such persons if the conduct is repeated.

It is now essential to refer to these provisions in every judgment when deciding whether or not it is reasonable to make a possession order based upon anti-social behaviour.

Further suspension

The court's power to stay or suspend execution or postpone the date of possession may be exercised when making an order for possession "or at any time before the execution of the order" (s85(2)).

When exercising its powers under s85 the court shall impose conditions with respect to the repayment of arrears of rent and mesne profits unless it considers that to do so would cause exceptional hardship (s85(3)).  There have been no reported Court of Appeal decisions as to what might constitute "exceptional hardship".

Where there is a substantial dispute about the amount claimed and the tenant's compliance with the order, the up-to-date position has to be clearly and accurately established before considering an application to suspend under s85 - Haringey LBC v Powell (1996) 28 HLR 798, CA.

The court, exercising its discretion on an application to suspend a warrant under s85, may take account of matters (e.g. breaches of the terms of the tenancy agreement or anti-social behavior) other than those relied upon as grounds for making the original possession order – although it is not always be right to do so.  (Sheffield City Council v Hopkins [2001] EWCA Civ 1023, [2002] HLR 12)

A tenant against whom an outright order has been made under a discretionary ground is entitled to make a fresh application to a district judge to stay or suspend execution.  Such an application “is not in any way affected or fettered by the reasons given by [the district judge who heard the possession claim] . . . on such an application the district judge can take all relevant circumstances into account as they appear at the time of the application.  Those will include any medical evidence which is before the court, any evidence as to the defendant’s behaviour since the original order and the effect of an immediate order for possession which is not suspended upon the likelihood of the applicant being re-housed under the Housing Act 1996.”    “There is a continuing remedy in the county court.” (Plymouth CC v Hoskin [2002] EWCA Civ 684, 1 May 2002)

There is no power under s85(2) to stay or postpone the date for giving up possession under an existing possession order if tenants have already given up possession without the need for execution of the order. The words 'at any time before the execution of the order' in s85(2) have to be read subject to the qualification 'and for so long as execution is required to give effect to that order'. (Dunn v Bradford MDC, Marston v Leeds City Council [2002] EWCA Civ 1137; [2003] HLR 15)

An agreement to forbear from evicting a former tenant after breach of an N28 suspended possession order does not restore the old tenancy but simply means the occupier is in a legal limbo as a 'tolerated trespasser' until either the agreement to forbear is broken (in which case the landlord can seek a warrant but N.B. Housing and Regeneration act 2008, above) or the former tenant applies successfully to the court to discharge, rescind or modify the order so as to revive the earlier tenancy (Burrows v Brent LBC [1996] 1 WLR 1448, [1996] 4 All ER 577, HL and Greenwich LBC v Regan (1996) 28 HLR 469, CA). Occupiers are not, however, homeless because they continue in occupation by 'rule of law' (Housing Act 1996 s175(1)(c)). If either party wishes to revive the old tenancy for the purpose of enforcing its express or implied terms, he or she can apply to the court for an order varying the date on which possession is to be given so that the old tenancy can be resurrected (s85(2)).

N.B. Swindon Borough Council v Aston [2002] EWCA Civ 1850; [2003] HLR 42. Although "the court will be extremely reluctant to infer the creation of a new secure tenancy during the limbo period", viewed objectively, the conduct of both landlord and tenant in this case was sensibly referable only to the existence of a new tenancy. That was confirmed by the way in which the landlord relied upon the terms of his 'tenancy agreement' to coerce him into keeping the garden in proper order, and by the provision of the new tenancy agreement. Mr Aston was accordingly a secure tenant from approximately three months after he cleared the arrears. It was neither possible nor necessary to rescind the original order; cf  Newham LBC v Hawkins [2005] EWCA Civ 451; [2005] HLR 42; Lambeth LBC v O'Kane; Helena Housing v Pinder [2005] EWCA Civ 1010; [2006] HLR 2 (sending notice of variation of tenancy conditions and four notices of revision of rent and water charges to tolerated trespasser did not create new tenancy). 

As to applications for orders under s85(2)(b) retrospectively to revive tenancies, see  Lambeth LBC v Rogers [2000] 03 EG 127, CA; Routh v Leeds CC June 1998 Legal Action 11, CA and Marshall v Bradford MBC [2002] HLR 22, CA where it was said that when considering an application to revive retrospectively a tenancy, the court should bear in mind: (i) the tenant's previous payment record; (ii) whether all parties were before the court; and (iii) whether the tenant was seeking merely the execution of works of repair or also damages for past disrepair.

After the warrant has been executed

The court's power to stay or suspend execution or postpone the date of possession only applies before the execution of the order - Hammersmith and Fulham LBC v Hill (1995) 27 HLR 368, CA.  After execution an occupier can only be restored to possession if either the possession order is set aside (see eg Governors of Peabody Donation Fund v Hay (1987) 19 HLR 145, CA; Hackney LBC v White (1995) 28 HLR 219, CA; and Tower Hamlets LBC v Abadie (1990) 22 HLR 264, CA) or the warrant has been obtained by fraud, abuse of process or oppression (Hammersmith and Fulham LBC v Hill (1995) 27 HLR 368, CA - arguable that the council had behaved ‘oppressively’ where the tenant claimed that after issue of the warrant, but before execution, council officers had said that the defendant would have no chance of having the warrant suspended unless she was able to pay £1,000 within 24 hours. 

In Southwark LBC v Sarfo (2000) 32 HLR 602, CA, Roch LJ said

“[O]ppression may be very difficult if not impossible to define, but it is not difficult to recognise. It is the insistence by a public authority on its strict rights in circumstances which make that insistence manifestly unfair. The categories of oppression are not closed because no-one can envisage all the sets of circumstances which could make the execution of a warrant oppressive”

“Oppression” is not limited to acts by the landlord.  Misleading information from a court office, depriving a tenant of taking steps to have execution of a warrant for possession stayed prior to execution, may amount to oppression (Hammersmith & Fulham LBC v Lemeh  (2001) 33 HLR 231, and Lambeth LBC v Hughes (2001) 33 HLR 350, CA). However it has also been held that (1) a possession warrant obtained and executed against a secure tenant without fault on anyone's part cannot properly be set aside as oppressive or an abuse of process; (2) oppression cannot exist without the unfair use of court procedures; and (3) something more than the mere use of the eviction process - some action on someone's part which was open to criticism - is required before the court's procedures can be said to have been unfairly used (Jephson Homes HA v Moisejevs [2001] 2 All ER 901,  CA).  See too Circle 33 Housing Trust v Ellis [2005] EWCA Civ 1233; [2006] HLR 7.

The Court of Appeal has held that the procedure which allows the issue of a warrant of possession and the arrangements for execution following breach of a suspended possession order do not infringe tenants’ rights under ECHR Arts 6, 8 or 14.  (Southwark LBC v St. Brice [2001] EWCA Civ 1138, [2002] 1 WLR 1537) but N.B. as a result of HRA concerns, bailiffs should now deliver Form N54 (Notice of Eviction) to all addresses where evictions are due to take place and hand it to the defendant personally or leave it at the property in an envelope addressed to the defendant(s) by name and “any other occupiers”.

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