[2024] UKUT 15 (LC)

Before looking in any detail at the facts and, in particular, at the leases with which the appeal is concerned it is convenient to refer to the statutory provisions pursuant to which the leases were granted.

As the leases each recite at clause 2, they were granted pursuant to section 122, Housing Act 1985, which gives secure tenants of local authority housing the right to buy their homes on the terms provided by the Act. Where the property is a house the tenant is usually entitled to acquire the freehold; where it is a flat, the right is to acquire a long lease for a term of 125 years. Section 139(1) specifies that a grant of a lease executed in pursuance of the right to buy is to “conform” with Parts 1 and 3 of Schedule 6 to the 1985 Act. In the rest of this decision references to Schedule 6 are to Schedule 6 of the 1985 Act.

Schedule 6 is concerned with the terms of conveyances of freeholds and the grant of leases in pursuance of the right to buy. Part 1 contains “common provisions” applying both to freehold conveyances and to the grant of leases. Those common provisions include rights of support, rights of way and other easements, as well as provisions to secure that the tenant will be bound by restrictive covenants. Otherwise, the parties are entitled to agree reasonable terms for the lease, as is apparent from paragraph 5:

“5.

Subject to paragraph 6, and to Parts 2 and 3 of this Schedule, the conveyance or grant may include such other covenants and conditions as are reasonable in the circumstances.”

Paragraph 6 renders void any provision of a conveyance or lease which purports to enable the landlord to charge the tenant a sum in connection with the giving of the consent or approval. Nothing in Part 1 of Schedule 6 expressly avoids any other type of provision; whether paragraph 5 might indirectly have that effect in the case of a provision of a lease which was subsequently found not to be reasonable is a question which may arise in the case of one of the appellant’s leases, but not in this appeal.

Part 3 of Schedule 6 is concerned with the terms of leases granted in pursuance of the right to buy. Paragraph 14 deals with covenants by the landlord and is in the following terms:

“14(1). This paragraph applies where the dwelling-house is a flat.

(2)

There are implied covenants by the landlord –

(a)

to keep in repair the structure and exterior of the dwelling-house and the building in which it is situated (including drains, gutters and external pipes) and to make good any defect affecting that structure;

(b)

to keep in repair any other property over or in respect of which the tenant has rights by virtue of this Schedule;

(c)

to ensure, so far as practicable, that services that are to be provided by the landlord and to which the tenant is entitled (whether by himself or in common with others) are maintained at a reasonable level and to keep in repair any installation connected with the provision of those services;

(3)

There is an implied covenant that the landlord shall rebuild or reinstate the dwelling-house and the building in which it is situated in the case of destruction or damage by fire, tempest, flood or any other cause against the risk of which it is normal practice to insure.

(3A) [consistency with superior leases]

(4)

The county court may, by order made with the consent of the parties, authorise the inclusion in the lease or in an agreement collateral to it of provisions excluding or modifying the obligations of the landlord under the covenants implied by this paragraph, if it appears to the court that it is reasonable to do so.”

Paragraph 16(b) of Schedule 6 provides that, unless the parties otherwise agree, there is implied into a lease of a flat granted in pursuance to the right to buy a covenant by the tenant to keep the interior of the dwelling-house in good repair (including decorative repair).

The general pattern of the statutory scheme, as far as repairing obligations are concerned, is therefore, unsurprisingly, that the landlord is to be responsible for repairs to the structure and exterior of the flat and the building, and the tenant is to be responsible for keeping the interior of the flat in repair. Schedule 6 does not expressly prohibit a different agreement, including one requiring the tenant to keep the structure and exterior in repair, and there is no equivalent of paragraph 6 rendering such a provision void. But paragraph 5 authorises the inclusion in the lease only of “such other covenants and conditions as are reasonable in the circumstances” and the landlord’s implied obligations may be excluded or modified only with the authorisation of the county court given under paragraph 14(4).

By paragraph 16A of Schedule 6 a lease may require the tenant to bear “a reasonable part” of the costs incurred by the landlord in discharging or insuring against the obligations imposed by the covenants implied by virtue of paragraph 14(2). That requirement is modified during the first five years after the grant of the lease by paragraph 16B, which limits the tenant’s contribution to an amount not greater than the amount estimated in respect of works itemised in a notice given by the landlord before the lease was granted. Where specific works were not itemised in such a notice the tenant’s contribution is limited by reference to an estimated annual average amount notified by the landlord before the grant of the lease. Paragraph 18 renders void any provision in so far as it purports to authorise the recovery of a service charge restricted by paragraph 16B.