rent liability or not?

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  • #39654
    rds01
    Participant

    We have a scenario of the CL being very disabled and can no longer stay in his 1 bedroom rented accommodation. His dad has phoned the office to say he has inherited a large sum of money and proposes to buy a 2 bedroom property and let his on live in it. There will be no mortgage and dad will make adaptions for his son’s disability. The dad is trustee for son and signs for everything. Dad says he will charge rent equivilant to 2 bed LHA rate (as son needs carers overnight) as we would pay that anyway. Son can’t sign tenancy agreement so effectively LL is signing an agreement with himself. Can we still award HB in these circumstances? Thanks

    #112901
    HaighR
    Participant

    Sounds like it is a commerciality/contrivance decision.
    I take it that the dad/LL has power of attorney/appointee over son?

    although I do not know what affect the trustee issue plays in this situation.

    #112905
    rds01
    Participant

    The dad does have PoA and is his son’s appointee. His motive is to help his son and get a steady income from his capital – no point having all this money in the bank and a son is poor accommodation! Just want tomake sure decision correct and concerned that as son cannot sign anything the LL is effectively makign an agreement with himself. Thanks.

    #112916
    Anonymous
    Guest

    Sounds similar to this case: CH/2822/2009
    https://hbinfo.org/wp-content/uploads/CH%202822%202009-02.doc

    In particular:

    46. If Steven had signed the tenancy agreement it would have been reasonably clear that he was contractually liable for the rent. The evidence is that he cannot read, but provided that a sufficient explanation had been given of the contents of the document, he would have been bound by his signature. In my judgment the evidence indicates that he would have been capable of understanding an explanation by Mr or Mrs G of the basic nature and effect of the tenancy agreement. (The contrary has not been contended on behalf of the Council).

    47. However, he did not of course sign the tenancy agreement. Ms Hodgson did not contend that contractual liability had arisen by reason of him signing any other document in which liability for rent might be said to have been acknowledged (e.g. the housing benefit claim form, or the application for a community care grant (which also contained a signature by Mrs G), or the statement which Steven signed at the visit by the Council on 8 May 2008 (which was also signed by both Mr and Mrs G). I do not think that such a contention could have succeeded; the statements in those forms as to his liability for rent were not intended to give rise to contractual liability, but were simply made for the purpose of giving information to the relevant authorities. Indeed, Ms Hodgson was careful to emphasise in her submissions that a tenancy could be granted, and liability for rent could arise, without an agreement in writing.

    48. An intention to create a tenancy will normally be inferred from the payment and acceptance of rent. But on my finding that no rent was paid, that possibility does not arise.

    49. In my judgment a contractual liability to pay rent can therefore only have arisen if conversations between Mr and Mrs G and Steven gave rise to an agreement on the part of Steven, intended to be legally binding, to pay for his occupation of the Annex. This was what Ms Hodgson in effect contended for.

    #112922
    Kevin D
    Participant

    Depending on the claimant’s ability to communicate, [b] Wychavon DC v EM (HB) [2011] UKUT 144 (AAC)[/b] (aka CH/0171/2011) may be relevant. Also see CH/0663/2003 & CH/1096/2008 (same appellant in both cases) and CH/1419/2005.

    #112952
    rds01
    Participant

    W

    #112954
    rds01
    Participant

    We understand that the son is SMI and there has no knowledge or understanding of the agreement. In this case I assume Wychavon applies and we cannot award HB? Thanks.

    #113368
    rds01
    Participant

    Further to my previous point, the Claimants dad (and potential LL) is his Legal Deputy, appointed by the court of protection. He is arguing that he can act on his sons behalf and make decisions for him. His son will have no knowledge or understanding of the tenancy. Many thanks.

    #113377
    Kevin D
    Participant

    Answers remain unchanged Ryan. For HB purposes, the issue of the son’s ability/inability to enter into an agreement is critical so the case law cited in the earlier posts is still potentially relevant. Issues of commerciality and/or taking advantage are “in the alternative”. The first consideration is “actual” liability. Based on the info given so far, I can’t see how the son can be held liable. If that is correct, nil HB. You need to read the case law in question – that will assist in the thought process and, in the event of the LA standing by its decision, will assist in compiling a submission to a FtT in response to what is probably an inevitable appeal.

    #114146
    rds01
    Participant

    Thank you for all your help. I have infoemd the father (potential LL) that it is unlikely we would award HB. As there is no decision he has cannot appeal. He is now asking is there someone in the DWP he can contact for advice. Does anyone know how he can contact DWP and if so who? Thanks.

    #114147
    Anonymous
    Guest

    I would just direct him to their website:
    http://www.dwp.gov.uk/publications/specialist-guides/technical-guidance/rr2-a-guide-to-housing-benefit/housing-benefit/

    Might be better off sending him to a local advice bureau.

    #114151
    Kevin D
    Participant

    In pointing the father in any particular direction, it would be wise not to raise his hopes in light of the case law available. Suppose, for the sake of argument, he is advised along the lines of “Oh, it’s just the LA being difficult / the sons inability to sign doesn’t matter….etc”. So, with that, the father goes ahead and then finds the LA makes exactly the decision indicated. Worse, it goes to Tribunal and the appeal is unsuccessful.

    It’s very tricky. I think the way in which it should be approached is a letter to the father, making it clear it is merely information, not a decision, enclosing examples of case law where the capacity of a claimant has been at issue. I wouldn’t attempt to analyse the case law in the letter; simply present it along the lines of “…for information, we enclose some case law…”.

    #114152
    rds01
    Participant

    I have already explained “we are not being difficult” or making any formal decision and that we are only giving advice on the informaiton available. I did say I’d post him the relevant case law. I do feel sorry for him, he clearly just wants to help his son. Thank you all for your help.

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