Human rights in the private rented sector: the end of the road?

18 Feb 2019

Housing, Public Law and Judicial Review

By Tara O’Leary

The European Court of Human Rights (ECtHR) has recently refused to entertain an application alleging that the eviction of a tenant from her home in the private rented sector was a disproportionate interference with her Article 8 rights. This decision confirms that – as things stand – tenants cannot invoke human rights protections in claims for possession brought by private landlords.

On 29 November 2018 the ECtHR declared that an application in the case of FJM v United Kingdom was manifestly ill-founded and thus inadmissible. The application was an attempt to appeal against the Supreme Court’s decision in the case of McDonald v McDonald [2016] UKSC 28, which held that tenants with assured shorthold tenancies (‘ASTs’) provided by private landlords were not entitled to raise Article 8 proportionality defences, particularly in possession proceedings brought under s. 21 of the Housing Act 1988.

The ECtHR’s decision in FJM marks the end of a long and ultimately unsuccessful journey for the McDonald family. The facts of the case are unfortunate. Mr and Mrs McDonald’s adult daughter, Fiona McDonald, suffered from lifelong mental health problems. She had been unable to work and lost two social housing tenancies, so they purchased a property for her to occupy and granted her an AST. The house had been purchased with the assistance of a mortgage secured on the property, but Mr and Mrs McDonald later fell into arrears and their lender appointed a receiver, which ultimately served a s. 21 notice in January 2012 and issued proceedings for possession. Those proceedings have only now finally concluded.

Fiona McDonald defended the claim on the basis that eviction would be a disproportionate interference with her rights under Article 8 ECHR. If the court could entertain this argument, the effect of course would have been that a judge could refuse to make an order for possession in favour of the landlord, or could have imposed conditions upon such an order, notwithstanding the apparently mandatory requirements of s. 21.

The essence of Ms McDonald’s argument rested on s. 6(1) of the Human Rights Act 1998, which provides that it is unlawful for any public authority to act in a way which is incompatible with a Convention right. As the courts are themselves public bodies and bound by s. 6(1) – so it was argued – all judges are bound to act in a Convention-compliant manner and thus to consider the proportionality of eviction before making any order for possession. In practical terms, this would have extended the application of Pinnock and Powell ([2011] 2 AC 104 and [2011] 2 AC 186) to private sector tenants, requiring the courts to carry out a proportionality assessment which includes a ‘balancing exercise’ of the competing factors for and against possession in sufficiently serious cases.

The Supreme Court rejected this argument in a decision handed down on 15 June 2016, holding [§40-43]:

In the absence of any clear and authoritative guidance from the Strasbourg court to the contrary, we would take the view that, although it may well be that Article 8 is engaged when a judge makes an order for possession of a tenant’s home at the suit of a private sector landlord, it is not open to the tenant to contend that Article 8 could justify a different order from that which is mandated by the contractual relationship between the parties, at least where, as here, there are legislative provisions which the democratically elected legislature has decided properly balance the competing interests of private sector landlords and residential tenants.

We now know that the ECtHR expressly agrees with this position. Less than a month after the Supreme Court handed down its decision in McDonald, on 12 July 2016, the ECtHR issued its ruling in the case of Vrzić v Croatia. This decision was also concerned with mortgagors who fell into arrears, and whose home was to be sold by their lender. It confirmed that, in cases such as this where there was no involvement by any public body (other than the court), and where the applicants had voluntarily used their home as collateral for their loan, there was no violation of Article 8 even in the absence of a proportionality assessment by an independent tribunal.

FJM v UK shows that – 16 months later – the court had no inclination to re-open its decision in Vrzić, in principle or otherwise.

Rather, whilst acknowledging that losing one’s home was an extreme form of interference with Article 8 [§36], the Court also reaffirmed that national authorities enjoy a wide margin of appreciation to determine the application of social and economic policies, and that the availability of procedural safeguards for individuals faced with the loss of their home will be important when considering whether national laws remain within the scope of that margin [§§34-35]. It is for legislation to strike a balance between the competing interests of private landlords and residential occupiers, in order to ensure that the Convention rights of both parties are adequately protected. It was held [§42]:

What sets claims for possession by private sector owners against residential occupiers apart is that the two private individuals or entities have entered voluntarily into a contractual relationship in respect of which the legislature has prescribed how their respective Convention rights are to be respected … If the domestic courts could override the balance struck by the legislation in such a case, the Convention would be directly enforceable between private citizens so as to alter the contractual rights and obligations that they had freely entered into.

A crucial point was that Ms McDonald had not actually challenged the compatibility of s. 21 itself with Article 8: she had only argued (fruitlessly) that the courts should conduct a proportionality assessment within the existing framework of s. 21 claims. Thus the ECtHR did not rule on whether or not the current procedure does in fact strike a lawful and proportionate balancing between the competing interests of landlord and tenant [§46]. Nonetheless, there are some suggestions in the decision that this argument would not succeed. As quoted above, the ECtHR – like the Supreme Court – was plainly uncomfortable with the concept of intervening in private contractual agreements. It also noted that s. 89 of the Housing Act 1980 already provides for limited relief in cases of exceptional hardship [§44].

This decision will therefore give comfort to landlords in the private rented sector, who have little reason to anticipate any significant changes to their right to seek ‘no fault’ possession orders – at least for the time being.

However nothing in FJM suggests that Article 8 will not avail tenants granted ASTs by landlords who are public bodies: namely, social housing providers providing temporary accommodation, ‘starter’ or ‘flexible’ tenancies. These bodies remain subject to s. 6(1) of the 1998 Act, and it is doubtful in any event whether the courts would consider these tenants to be mere ‘private citizens’ who had ‘freely’ or ‘voluntarily’ entered into contractual bargains with their landlord.

Rather, social landlords should carry on with the assumption they are still governed by the principles in Pinnock and Powell, even in cases concerning ASTs. However – as always – those principles are subject to the important caveats that any Article 8 defence is subject to the “high threshold of being seriously arguable</em>”; that even social landlords are entitled to vindicate their property rights; and that the inherent public benefit in effective management of social housing stock will be given very considerable weight in any proportionality assessment: e.g. Powell [§§33, 36], Thurrock BC v West [2013] HLR 5 [§§22-31] and Hillingdon LBC v Holley [2017] PTSR 127 [§§15-16, 19].