Property Law – Rise and Shine

By : Andrew Lane

In dealing with the question of quantum in residential disrepair claims the Courts are faced, in each case, with a unique set of facts. Advocates often try to rely on factually similar cases set out in publications such as “Legal Action”, “Current Law” and the excellent “Housing Law Casebook” to support their case on the correct level of damages.

Recent practice however would appear to be less concerned with what other County Court Judges have awarded in cases based on seemingly similar facts, and more on the question of what “reduction” in rent is appropriate to compensate the tenant. This is not a “new” approach as such, though perhaps represents a reconsideration of what the authorities in this area actually say.

The starting point is the seminal Court of Appeal authority of Wallace v Manchester City Council (1998) 30 HLR 1111. In this case, the Court of Appeal explained that the relevant issues to consider in assessing disrepair quantum are:

1. the “loss” requiring compensation is the loss of comfort and convenience arising from living in a property which is not in a proper state of repair;
2. such a loss can be ascertained in a number of different ways including a notional reduction in rent;
3. if a judge prefers to use a global approach rather than the notional reduction in rent she/he is well advised to cross-check the proposed award against the rent payable for the disrepair period to ensure proper consideration is given to the landlord’s breach or the nature of the property;
4. the purpose of awarding damages in such cases is not to punish the landlord but, as far as money can, restore the tenant to the position they would have been in if there had been no breach.

The true position therefore appears to be that where the tenant remains in occupation, the diminution in value for which he is entitled to be compensated is the personal discomfort and inconvenience he has experienced as a result of the want of repair. The compensation may take the form of a notional reduction in the rent, a global award for discomfort and inconvenience, or a mixture of the two.

This approach has been further approved in the recent case of English Churches Housing Group v Avrom Shine [2004] EWCA Civ 434 where the Court of Appeal confirmed the notional rent reduction as a suitable reference point in deciding quantum. Lord Justice Wall said @ para 104:

“… whilst we equally accept that there will be cases in which the level of distress or inconvenience experienced by a tenant may require an award in excess of the level of the rent payable … the award of damages for stress and inconvenience should be related to the fact that the tenant is not getting proper value for the rent …”

And so, for example, in a recent case at Bow County Court the sum of £14,000 was awarded to the tenant in general damages for disrepair stretching over a period of a little over 3 years (Mzae v Abigo – 12th August 2004 before HHJ Bradbury). Her rent was £10,400 pa. This is an award considerably in excess of that which would have been expected on a simple case comparison analysis.

This emphasis on “notional rent reductions” is of obvious benefit to those tenants, primarily in the private sector, who are paying high market rents, and of considerable concern to the private sector landlords. The situation is of course the reverse in the public sector, where tenants pay considerably lower rents, and the landlords will be pushing to have any awards assessed on the basis of a reduction in these low rents.