England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT

		Royal Courts of Justice Strand London WC2
		14th February 2006

1. MR JUSTICE BEAN: This is an application for judicial review of a decision of the London Borough of Lambeth. The complaint is that the Council unreasonably withdrew the claimant's right to buy. The remedy sought is an order that the defendants restore the right to buy and allow the claimant to complete the purchase of the relevant property, 5 Listowell Close, London SW9 6DN, immediately.
2. The sequence of events is as follows. The claimant's secure tenancy of the property began on 29th April 1991. On 29th October 2001 she submitted a Right to Buy application. In response to the RTB application, a form RTB2 to her. On 13th November 2001 notice was given under section 125 of the Housing Act 1985, the landlord's notice of purchase price and other matters. Further correspondence followed, but there was no notice of intention to pursue the right to buy served as section 125D of the Act requires. That section, added by amendment in 1993, requires that where a notice under section 125 has been served on a secure tenant, the tenant must serve a written notice under section 125D(1)(a) or, alternatively, section 125D(1)(b) -- which I think is not applicable here -- within 12 weeks of the service of the section 125 notice or the service of a notice under section 128(5) where there has been a determination or re-determination by a district valuer. A district valuer was indeed involved and the Council enclosed his decision under cover of a letter of 8th May 2002. No section 125D notice was served by the tenant within 12 weeks of that, and on 1st August 2002 the Council wrote to the claimant giving her a further 28 days, failing which the right to buy would be deemed to be withdrawn. She replied on 15th August, saying that she wished to pursue the matter. So much for sections 125D and 125E.
3. There was further correspondence but no completion, and on 7th August 2003 the Council served what the Act describes as a "first notice to complete" under section 140. That enables the landlord to give a period of notice, such as is reasonable in the circumstances and of at least 56 days, for completion. There was no response to that within the 56 days specified. That entitled the Council to serve, and they did serve, a second notice to complete pursuant to section 141. I shall read subsections (1), (2) and (4) of that section in full because they seem to me to be of some importance:

"141(1) If the tenant does not comply with a notice under section 140 (landlord's first notice to complete), the landlord may serve on the tenant a further written notice

(a) requiring him to complete the transaction within a period stated in the notice, and

(b) informing him of the effect of this section in the event of his failing to comply.

(2) The period stated in a notice under this section shall be such period (of at least 56 days) as may be reasonable in the circumstances...

(4) If the tenant does not comply with a notice under this section the notice claiming to exercise the right to buy shall be deemed to be withdrawn at the end of that period..."

There is provision under section 141(3) for the Council to extend the period by a further written notice. They did do so once on 18th November 2003. There was no response to that and therefore, it seems to me, that, by virtue of subsection (4) of section 141, the notice originally given by Miss Burrell claiming to exercise the right to buy was deemed by statute to be withdrawn 56 days after 18th November 2003, or, if that was received a day or two later, then 56 days from that; that is to say, sometime in mid-January 2004. Nevertheless, there was still correspondence between the council and the claimant's then solicitors, Joseph & White.

4. On 24th March 2004 the Council sent draft documentation to Joseph & White. On 20th May they wrote again, saying that they had not heard anything and that completion had to take place by 14th June 2004, "time is of the essence". On 10th June Joseph White, by telephone, asked for a further extension of time. That was granted by letter of 16th June to 5th July 2004.
5. As of 11th June, there were rent arrears of £404.76 and the Council made it clear that it was not willing to complete while there were still rent arrears. The letter of 16th June agreeing an extension of time to 5th July enclosed a completion statement and added that that was the amount payable providing there were no rent arrears in respect of the property. The letter added:

"Transfer

We look forward to receiving the Transfer duly executed by your client, by return, so that we can arrange for it to be sealed on behalf of our clients in escrow of completion. Please ensure that your client signs the plan annexed to the Transfer.

Source of the finding

Please let us know how your client's purchase is being funded. If with the aid of a mortgage, please confirm that you are in receipt of a satisfactory offer. Without this information we cannot proceed to completion".

6. A further letter of 1st July from the Council's solicitors, Steeles, to Messrs Joseph & White stated that there were rent arrears of £7.14 and required that that be paid either in cash or should be added to the money being sent to the solicitors on completion.
7. Mr Wynell-Sutherland, who has appeared for the claimant today, submits, and I accept, that £7.14 is a very small sum. If the completion monies had been transmitted and the other steps by way of execution of documents taken by the claimant so as to meet the deadline of 5th July, and the only default on her or her solicitor's part was that the completion monies were £7.14 short; and the Council had then, as it were, torn up the whole transaction and refused to allow the claimant to exercise her right to buy because of the default of £7.14; that would be one thing. But that is not what happened. There was, on the face of the correspondence, a deafening silence from Messrs Joseph & White from the time of receipt of the critical letter of 16th June until after the deadline had passed.
8. On 7th July the Council's solicitors notified the Council that the tenant had failed to complete the purchase of the property on 5th July. Messrs Joseph & White broke their silence on 8th July in a letter which, after the heading, reads in toto as follows:

"Dear Sirs

Re: 5 Listowell Close, London SW9 6DN

Thank you for your letter of 1st July 2004.

Upon receipt of our client's instructions we will revert to you."

This they did on 19th July as follows:

"Further to our previous correspondence we request an extension of the above offer until the 2nd August 2004 so that we can deal with requisitions raised in your letter of 1st July 2004.

Please confirm the above is satisfactory and that a new completion date of 2nd August is acceptable."

The Council refused.

9. It seems to me that once section 141(4) took effect in January 2004, the claimant no longer had the protection of the statutory scheme and any extensions of time granted by the Council were a matter for them. If they granted an extension of time, as they did, and the claimant failed entirely to take the steps required of her to meet that deadline, then they were entitled, as any party to any conveyancing transaction would be, to say "We have had enough, you have failed to complete in time, the deal is off". This is what the Council did. It was not, as I read the correspondence, simply a matter of £7.14; it was a matter of a total failure to take the steps necessary to complete. Whether this is the fault of the claimant or of her solicitors or both is not a matter for me. I have no way of knowing what the answer is and it cannot, as I see it, affect the position of the Council. They were quite entitled to act as they did.
10. I am grateful for the submissions of Mr Wynell-Sutherland, who has performed valiantly despite having the unenviable task, firstly, of picking up a case at short notice (counsel originally instructed having sadly died recently since settling the skeleton argument) and, secondly, having to attempt the impossible in providing an explanation of why previous solicitors and his client both apparently failed to act at the crucial time following receipt of 16th June 2004. Nevertheless, it seems to me that this claim cannot succeed and I therefore dismiss the application for judicial review.
11. MISS BHOGAL: My Lord, in light of that order there is an application in respect of costs. The order that I invite my Lord to make is that the applicant do pay the respondent's costs, and those costs be subject to a detailed assessment if not agreed.
12. MR JUSTICE BEAN: You cannot resist that, can you, Mr Wynell-Sutherland?
13. MR WYNELL-SUTHERLAND: Not at all, my Lord.
14. MR JUSTICE BEAN: I make that order. Thank you very much.