This week we look at the Housing Select Committee recommendations on proposed reforms of the private rented sector and review a case on the characteristics of easements and ancillary rights. As usual we also point you in the direction of some interesting insights from across the firm and we mark International Women's Day with a celebration of women's achievements in our positive news.
House of Commons report on residential tenancy reform
The Levelling Up, Housing and Communities Committee has published a report on Reforming the Private Rented Sector ("the PRS"), with recommendations to the Government. This follows the Government White Paper entitled A Fairer Private Rented Sector published in June 2022 which sought to address concerns about security of tenure and housing quality within the sector. The Select Committee undertook a review of the proposals in the White Paper and has made subsequent recommendations.
The White Paper set out plans to repeal Section 21 of the Housing Act 1988 which currently allows 'no fault' evictions and to replace fixed-term tenancies with a system of open-ended (i.e. periodic) tenancies. The Select Committee agreed that these proposals would give tenants greater security of tenure although they concluded that the student PRS market should retain fixed-term tenancies fearing that a move away might make renting to students less attractive for private landlords.
As part of the reforms, the Government has proposed strengthening Section 8 of the Housing Act 1988 to introduce new grounds for possession for landlords who want to sell their property or move themselves or close family members into it. The report considered the proposed protections for tenants to prevent landlords using such grounds within the first six months of a tenancy and to prevent re-letting for three months following their use. The report concluded that both of those time frames should be doubled (i.e. to one year and six months, respectively) to avoid 'bad landlords' exploiting these grounds.
On housing conditions, the Government aims to introduce a legally binding decent homes standard ("DHS") for the PRS (currently there is only a standard for social housing). The Government has proposed a £10,000 cap on costs to landlords in relation to three out of four criteria for the DHS, thus a property would be 'compliant' once the £10,000 cap is reached. The report recommends that on energy efficiency, the Government should come up with a financing solution for situations where such works exceed the cap. The report also recommended that local authorities be given greater enforcement powers to police the DHS and ensure courts require offenders to cover the full costs of enforcement.
The report supports the Government proposal to introduce a new property portal which will require landlords to provide information about every property they let so local authorities have the data to allow them to enforce housing standards more easily. The report recommends that the Government introduce a single ombudsman for all letting agents and landlords across the PRS.
More broadly the report calls for the Government to introduce a specialist housing court and to improve the ability of courts to deal with possession hearings. It also called for the Government to recommit to delivering more affordable homes, namely 90,000 social rent homes. A draft of the Renters Reform Bill is expected this year so we will soon see which recommendations the Government has taken up.
See the full report here.
Gosling and others v Bradbury and another - [2023] EWHC 199 (Ch)
This appeal, by the owners of Ford Farm, relates to easements and the extent of ancillary rights.
In a 1982 conveyance, Rashwood Lodge reserved the benefit of a right over neighbouring Ford Farm to take water from the spring by means of a pump and pipes along with the right to enter the farm for the purpose of inspecting, cleansing, maintenance and repair, making good any damage caused'.
The right was enjoyed by Rashwood Lodge until the owners of Ford Farm cut off the electricity supply to the pump moving the water subject to the easement in 2019. The owners of Rashwood Lodge subsequently applied to the Court, and successfully obtained a declaration that they were entitled to access the water supply from the borehole and an injunction restraining the owners of Ford Farm from interfering with it.
The owners of Ford Farm (the Appellants) challenged the findings of the Court on the following grounds.
- That the Judge had failed to conclude that the supply of electricity is necessary to the exercise or enjoyment of the easement;
- That the Judge was wrong to conclude that the easement granted an ancillary right to the passage of electricity via Ford Farm to the pump because such a right is positive in nature;
- The Judge was wrong to hold that the easement was a legal easement because it imparted no benefit to Rashwood Lodge;
- The Appellants had not interfered with water easement and/or its ancillary rights; and
- The Judge was wrong to conclude the easement was a legal easement because correspondence exchanged a number of years after the conveyance suggested that positive obligations were imposed on the owner of Ford Farm by the easement.
On appeal, points 1, 3 and 4 were dismissed on the basis they had not been raised at trial.
In response to the second point, it was held that the ancillary right to enjoy the passage of electricity across Ford Farm did not impose a positive obligation on the owners or their successors in title but merely required them to suffer things to be done on the Property. The ancillary right to the passage of electricity was not, therefore, deemed to be a positive obligation as claimed and did attach to the easement.
Before being dismissed, the third ground argued by the appellant was that the right did not provide a benefit to Rashwood Lodge (and therefore could not be an easement) because the water contained levels of arsenic unsafe for human and animal consumption. Although ultimately dismissed, the Judge noted that the right to a passage of water across neighbouring land 'is undoubtedly something which is capable of providing a benefit to the dominant land itself and it not merely personal to the landowner' and the water quality was not determinative to whether there was a benefit.
Finally, under the fifth ground of appeal, the validity of the easement itself was challenged. The appellants argued that the easement imposed a positive obligation on the owners of Ford Farm to supply and pay for electricity (relying on correspondence created a decade after the easement) and so could not be a legal easement. This was rejected by the Court on the basis of the well-known rule that a contract is to be constructed in light of the circumstances reasonably known to both parties at the time of execution.
The appeal was ultimately dismissed and the trial Judge's findings upheld. This case is a useful reminder of the key characteristics of easements and the potential for ancillary rights.
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