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Property Law - The Right to Buy lives on... or does it?

By : Alison Meacher

The 'Right to Buy' is governed by the statutory provisions contained in Part V of the Housing Act 1985. In the event of the death of the secure tenant the statute enables those entitled to succeed to the secure tenancy to simply step into the shoes of the former secure tenant and continue the application for the right to buy, for the same purchase price and the same discount (s.136(1)). This provision does not however assist 'second succession' cases, i.e. those who cannot succeed to the secure tenancy under Part IV of the Act because there has already been one succession to the tenancy.

In practice, this situation could be avoided by seeking to have adult family members who live in the property included as joint tenants with the first successor - but rarely is this considered until it is too late. The local authority may also have a policy that provides for a discretion to grant a secure tenancy of the property to the 'second successor'. But if not, what happens next?

The Court of Appeal has made it clear that, in accordance with s.123(3) of the Act, a family member validly included on the application for the right to buy is deemed to be a secure tenant for the purposes of Part V of the Act and can continue the claim for the right to buy, even if they are not entitled to succeed to the tenancy under Part IV of the Act: London Borough of Harrow v Tonge (1992) 25 HLR 99,CA.

Conversely, in City of Bradford MBC v McMahon (1992) 25 HLR 536, CA, the Court confirmed that a person not included on the application for the right to buy is not entitled to continue the claim for the right to buy unless they are entitled to succeed to the property - even where the secure tenant would have been entitled to an injunction against her dilatory landlord pursuant to s.138(3) of the Act immediately prior to her death.

A principle common to both of these judgements is that the right remains subject to the deemed secure tenant being in occupation of the property until the conveyance or the grant. The result is that those who were included in the application for the right to buy can continue the claim to exercise the right to buy after the death of the secure tenant even where they are not ordinarily entitled to succeed to the property so long as they fulfil the occupation condition.

The local authority will, however, be entitled to serve a notice to quit and commence possession proceedings against the 'second successor'. If the local authority is granted a possession order before the conveyance or grant the claim to the right to buy will be extinguished (s.121(1)).

So what happens when the local authority are dilatory in processing the claim for the right to buy and/or seek possession of the property? Is it possible to protect the rights of the deemed secure tenant?*

The key for all legal representatives is to act expediently. Send a letter before action providing a minimum period for compliance. The letter should refer the local authority to the judgement in Tonge if the local authority is denying the claim to the right to buy altogether, the letter should also ask the local authority to consider exercising any discretionary power to grant a second succession to the secure tenant or to grant a new tenancy of the property. If no solution is forthcoming, within the time given, a claim should be issued in the County Court (s.181) seeking a declaration establishing the right to buy if necessary and/or a mandatory injunction forcing the local authority to comply with the statutory provisions and process the claim for the right to buy promptly.

Ordinarily this should be a Part 8 claim, being a simple dispute of law, rather than fact. This would also enable the court technically at least, to list the claim for a hearing the first open date 28 days after service.

Timing would appear at first brush to be essential, in particular, if possession proceedings have also been issued. The proprietary rights of the tenant and landlord being determined according to who can get their claim listed and heard first. Lord Hoffman considered this issue in Bristol v Lovell [1998] 1 WLR 446, HL, and found it quite unsavoury that property rights could be determined by arbitrary workings of the listing office in this way. The House concluded that when faced with such a situation, the court had an inherent case management power (now contained in the Civil Procedure Rules Part 3) to adjourn proceedings as it thought fit, in accordance with the facts of the case and in the interest of justice.

So, how does the court determine which matter should be heard first when it is likely that the determination will defeat the substantive rights in dispute in the other claim?

The Court of Appeal, in Tandridge District Council v Bickers (1998) 31 HLR 436, CA, (at 437) following the judgement of Lord Hoffman in Bristol, directed that the key determining factors for the case management of such cases should be:

  1. the sequence of events, i.e. in what order the proceedings were commenced - was the claim for the right to buy commenced as a defence to possession proceedings, or were the possession proceedings commenced as a defence to the right to buy; and,
  2. the seriousness of the allegations in the proceedings for possession.

* (NB: if the secure tenant dies intestate the notice to quit must be served on the personal representative and the public trustee simultaneously, if not, the notice will be invalid and the possession claim can be defended and most likely defeated on that ground.)