Judge rules Housing Act (overcrowding) size issues apply to the bedroom tax

Last week I released the transcript of the successful bedroom tax appeal in Kirkcaldy in Fife – the case of  AHG  – which ruled a landlord and council held 3 bed property was in fact a 1 bed property.

This case opened up the room size and room usage and room purpose debates and a few more though the CIH dismissed this as being only pertinent to AHG’s property being a converted 1660 former manse house and not a standard modern property.  I disagreed strongly and said it meant every tenant should appeal the bedroom tax decision and the case below of DN proves without any doubt that the CIH view was incorrect.

Here I release another of the successful appeals in Kirkcaldy and this decision is on a standard modern property (as two more successful cases were also) will blow open the bedroom tax and is incredibly significant.

The judge ruling that a 66 square feet room is not a bedroom, that the overcrowding space standards do apply – the judge calls this the flip side of under occupancy – and the judge uses the A4/2012 guidance and the HB Regulations to detail WHY the overcrowding regulations apply.

This also strongly means that every HB decision on the bedroom tax needed to have taken the space standards into consideration, or in simple terms that the overcrowding regulations of the Housing Act 1985 in England and the Housing Act (Scotland) 1987 apply and HBR uphold that.

The bedroom tax affected tenant now has a legal ruling and should launch an appeal if an alleged bedroom(s) is less than 70 square feet in floor area and the chances of winning on that issue has increased massively.  If a bedroom tax tenant with a room of less than 70 square feet does not appeal then they are being incredibly foolish. 

Background

DN and his wife live in an alleged 3 bed property and the children have flown the nest leaving them alone there, an all too typical scenario.  The council and landlord said it’s a 3 bed and so on 1 April the 25% bedroom tax deduction is applied.

Very shortly after the council reduce this to 14% as it agrees that one of the allegedly 2 spare bedrooms is used by a non-resident carer to sleep in.

DN then appeals on the alleged third ‘bedroom’ claiming it is only 49 square feet of usable floor space. The council disagrees and two weeks before tribunal is heard the council comes out to measure (itself significant) and says the alleged bedroom is 66 square feet in floor space.

The judge chooses to believe the council’s word on the size of the room, however nothing turns on this as the judge rules it is not a bedroom and the bedroom tax guidance and HB regulations support this and the overcrowding standards of the 1987 Housing (Scotland) Act apply.

Note well the Housing (Scotland) Act 1987 replicates the Housing Act 1985 with regard to overcrowding and the space standard and nothing turns on this.

The pertinent paragraphs of the judgment are below and the judge outlines Graham Sutherland’s (from the Fife Law Centre for the tenant) submission for the tenant at paragraph 19:

“..he submitted that the disputed room was too small to be classified as a bedroom.  In this regard he referred to the statutory overcrowding provisions of the Housing (Scotland) Act 1987. He submitted that in terms of section 137 of this Act a room of under 50 square feet fell to be wholly disregarded as sleeping accommodation.  In relation to a room between 50 and 70 square feet (the dimensions of the room accepted by me), this was only to be regarded as sufficient for a child under the age of 10.” 

 “Mr Sutherland had also earlier pointed out that in paragraph 63 and Annex C of Circular A4/2012 the Secretary of State suggests that claimants with additional rooms should consider taking in a lodger.  The inference from this was that an additional room should only be classified as a room was too small for this purpose and so should not be classified as a bedroom for the purpose of paragraph B13(5)”

The judge then decides on these submissions at paragraph 23 and this is the paragraph that will make landlords and councils, and indeed lawyers sit up and note (and make every tenant pop the champagne cork):

“…I would accept that the disputed room is of a size that would normally be regarded as too small to be used as an adult bedroom. I accept that the thrust of Mr Sutherland’s submission here, namely that under-occupancy can be seen as the flip side of overcrowding, and that it is relevant to have regard to statutory space standards.  These indicate that a room of this size is appropriate for use as sleeping accommodation by a young child but not an adult.  It is in effect regarded by section 137 of the 1987 Act as only half a room.  I also accept, having regard to Circular A4/2012, that paragraph B13(5) generally presupposes that to be classified as a bedroom a room should be large enough to be appropriate for use as a bedroom by an adult – or by two children.”

That paragraph is legal dynamite and says so much.

• The space standards of overcrowding DO apply, in fact overcrowding is the flip side of under crowding or under occupancy.
• The overcrowding room size issues found in legislation DO ‘read across’
• Not only that but HB regulations 2006 paragraph B13(5) generally presupposes a bedroom is large enough to sleep an adult and be 70 square feet or more.  Or because HBR says that a bedroom is for either an adult or two children the size issue applies and
• Councils should have considered this as part of the original decisions made.

I have always been of the opinion that the space standards should apply morally and in lay terms and may apply in legal terms.  I have been castigated for that view by every social landlord, by the NHF and outrageously by the CIH who scurrilously said I was giving tenants false hope and denying other more worthy cases of getting appealed.

Many housing lawyers have also said the overcrowding regulations do not ‘read across’ to the bedroom tax and I have read a few barristers opinions which say the same and I  must have appeared arrogant and conceited and bloodyminded in opposing such strong and prevailing views.  I was conscious of that perception yet felt it necessary to challenge on grounds of process – of which room size is but one argument and not synonymous – which have been borne out here and in the AHG case I reported last week. I was not alone of course in the importance I gave to room size and Jonathan Mitchell QC gave an early opinion which said room size and rooms usage are very important factors yet he too had his views attacked but of course all counter arguments to his views started “Respectfully I disagree” unlike the CIH who chose Inside Housing to launch a tirade and professional character assassination against me and they were wrong then and clearly wrong now.

We now have a court ruling on the matter and views and opinions no longer count as that speculation has ended and no longer can room size issues and the relevance and applicability of the 1985 Housing Act be denied.

Yes as I also said of the AHG case, a First Tier Tribunal case in isolation is not legally weighty, yet in context is hugely significant and especially so here.

The significance of this is that landlords and councils have to radically change not just their views but their actions. 

What it means for the bedroom tax tenant is easy – appeal, appeal, appeal on room size issues and the room usage issues the AHG successful appeal gave.

For landlords it means radical change and the words most uttered when landlords read paragraph 23 above will be four letters long and end in a ‘t’ or a ‘k’ with the word ‘oh’ in front of them.  I would suggest maybe as much as 20 – 25% of social landlord properties have a smaller bedroom (now room) of less than 70 square feet.  So many properties landlords thought were 3 beds are now only 2.5 beds yet this is actually a good thing for landlords as well as tenants.

I have explained before that councils do not have the powers under HBR to restrict or reduce HB payments from the current 3 bed level to a new 2.5 bed level because they can only restrict if the rent is ‘unreasonably’ high.  This is because the average differential between a 3 and straight 2 bed averages less than £6 per week according to HCA figures released in the last 2 weeks and so the same HB paid for the now 2.5 bed cannot be described as ‘unreasonably’ high. This also means as rental income remains the same there is likely to be little issue for landlord’s lenders over asset value and of course arrears are reduced by 25% too.

If that holds and I am highly confident it does then landlords will be very happy at this (once they get over the shock that the 1985 Act applies!) Moreover because 81% of bedroom tax households were said to under occupy by 1 bed, or 540,000 of them (DWP impact assessment June 2012) then this Fife judgment when replicated could take 135,000 households out of the bedroom tax altogether and reduce the landlord arrears risk by 25% as well.

This successful appeal and its decision could take out altogether or reduce from 25% to 14% up to 165,000 households from the bedroom tax  – this being 25% of the total 660,000.

It would also be welcomed by councils too.  They have a 25% lesser risk of homeless costs as 25% less homeless cases will be coming through.  It also means existing DHP budgets can go further too as there are 25% less DHP cases.

I also would strongly argue that councils should ALL revise their working definition of a ‘bedroom’ and rule out all rooms under 70 square feet – and landlords should lobby them to do precisely that.  That argument will mean more to a number of large social landlords and others who I put that argument too very recently and they will need to revise their thinking on this in light of the DN successful appeal and the inclusion of the overcrowding size issues and HBR tie-up in particular.

(My not naming them shows my motives to be professional as they will recognise.)

The coalition however will be spitting feathers!  The claimed (but highly disingenuous) £500m per year saving they sought from the bedroom tax would reduce by £125m.  Not only that but as we are almost half a year in to the bedroom tax this means £60m or so would have to be back paid to tenants wrongly assessed as having too many bedrooms. Note well too that those figures only relate to the room size issue and I strongly suspect the room usage issue from the AHG case will see many more disabled tenants having an alleged bedroom chalked off as it is used to store disability equipment or because its substantive purpose is not as a bedroom.

This case is hugely significant for the reasons above.

Footnote:

There are a few other aspects of the DN case I won’t discuss now for sake of brevity and because of that and a few other reasons relating to sensitive information in this judgment I have decided not to release the full transcript here.  The reasons do not impact in any way on the above and none of the above is in any way out of context. I will publish the full transcript shortly and it not being held back for any vanity, stealth or financial or other gain on my part.  All will become clear when I release it which is likely to coincide with a third transcript.