The Succession Loophole (Assured Tenancies)

When a social tenancy has been in place for decades, establishing what has previously occurred, and how it might impact a legal dispute today, can prove a complex matter. One generally accepted rule, though, is that whether it is governed by the Housing Act 1985 (“HA 1985”) or the Housing Act 1988 (“HA 1988”) only one statutory succession is permissible. What, though, is the position if a tenancy has moved from one regime to the other? It seems to this author that, in specific circumstance, the succession clock can be restarted.

Consider the following, hypothetical scenario:

In 1987 Mr Smith is granted a secure tenancy by his Local Authority’s Housing Department for a house, and moves in with his wife and two children. The tenancy is clearly governed by the HA 1985, and when Mr Smith passes away in 1994 his wife succeeds him pursuant to S.89 HA 1985. Mrs Smith is now a successor, and the tenancy cannot be succeeded to again pursuant to the old S.87 and S.88 HA 1985, now S.86A and S.88 of the amended act. Now, however, in 2000, the Local Authority transfer their housing stock to a private housing provider, including Mrs Smith’s house. Under S.38 HA 1988 Mrs Smith’s tenancy becomes assured and comes within the HA 1988 regime. Now, upon Mrs Smith’s death, the question of whether a succession is possible will be decided within the HA 1988 regime. S.17 (1D) HA 1988 sets out the bar on second succession, that any tenant who was [themselves] a successor as defined in subsection (2) or subsection (3), cannot pass on their assured tenancy by way of statutory succession. The subsections read as follows:

(2) For the purposes of this section, a tenant is a successor in relation to a tenancy if –

1. the tenancy became vested in him either by virtue of this section or under the will or intestacy of a previous tenant; or
2. at some time before the tenant’s death the tenancy was a joint tenancy held by himself and one or more other persons and, prior to his death, he became the sole tenant by survivorship; or
3. he became entitled to the tenancy as mentioned in section 39(5) below.

(3) For the purposes of this section, a tenant is also a successor in relation to a tenancy (in this subsection referred to as “the new tenancy”) which was granted to him (alone or jointly with others) if –

1. at some time before the grant of the new tenancy, he was, by virtue of subsection (2) above, a successor in relation to an earlier tenancy of the same or substantially the same dwelling-house as is let under the new tenancy; and
2. at all times since he became such a successor he has been a tenant (alone or jointly with others) of the dwelling-house which is let under the new tenancy or of a dwelling-house which is substantially the same as that dwelling-house.

My emphasis is added to (2)(a). In our hypothetical scenario, Mrs Smith did not succeed by virtue of this section, namely S.17 HA 1988, she succeeded under S.89 HA 1985. Mrs Smith was also not a joint-tenant with Mr Smith, and does not fall within any other provision within subsections (2) and (3). This means that the S.17(1D) bar cannot apply to her, and that all the S.17 routes of succession are, therefore, available to those that might want to succeed her.

It is notable that subsections (2) and (3) do not contain a broad, catch-all provision equivalent to S.88(e) of the HA 1985 which states that a tenant is a successor where they became the tenant on the tenancy being vested in him on the death of the previous tenant. Such a provision in S.17 HA1988 would undoubtedly catch Mrs Smith, but it does not exist. Its non-existence, 3 years after Parliament legislated for the HA 1985, can only be seen as an intentional omission.

The Joseph Rowntree Foundation reports that more than 1.3 million houses were affected by social housing stock transfers between 1998 and 2008. It is likely, therefore, that a good number of households, who succeeded under secure tenancies before the relevant stock transfer, can now pass their tenancies on a second time by way of succession. The default position should, therefore, not be that a second succession is debarred, but that every case needs to be properly investigated and evaluated on its own individual facts. To give one example, if our Mrs Smith took a new spouse or civil partner, who came to occupy the property with her as their principle home, then it is highly likely that they would be able to succeed to the assured tenancy under S.17.

Becket Chambers is able to provide advice on any element of succession or housing law to legal professionals, or to the public on a direct access basis. Any enquiries should be directed to clerks@becket-chambers.co.uk.