A Supreme Court ruling has confirmed that the right to a private and family life cannot stand in the way of landlords or rental agents from reclaiming possession of a property. Although these rights are enshrined in European Convention on Human Rights, they apply to ‘no fault’ possession claims.
The ruling came to light following the case of McDonald v McDonald in which parents let out a property to their daughter who had mental health issues. However, they found they could not keep up the loan interest payments on her property. The parents also allegedly breached the terms and conditions of their mortgage agreement as they did not have permission to let the property. Their lender sought to reclaim possession, which was challenged by the daughter in the courts. The case went all the way to the Supreme Court, with human rights being raised, but the judges turned down her appeal.
Residential Landlords’ Association policy director David Smith said that it would have undermined landlords’ ability to take back possession of their property once a tenancy agreement had ended, had the appeal been allowed.
If the appeal was granted, it would have damaged confidence in the rental market as landlords might have been reluctant to invest in such circumstances while lenders might also have felt uneasy about funding new rental homes.
The ruling means that human rights arguments cannot be used to circumvent or override an existing contract drawn up by landlords or letting agents. The ruling really brings clarity to the situation and maintains the status quo for private landlords. Different rulings could apply to public sector landlords or registered social landlords.
The landmark decision concluded that Parliament had already set up a balance between the rights of landlords and tenants when it drew up the housing legislation. It further ruled that it was not for the Court to change any rights and obligations laid out in the contract or to interfere with property rights which could lead to a financial loss to the landlord.
The Housing Act 1988 is written so that private landlords can let properties on assured shorthold tenancies, with the near certainty that they can reclaim the property if needed.
If landlords or management companies felt that they could not get the property back from bad tenants, they may look elsewhere to invest, rather than face financial loss through the inability to re-let the property and punitive legal expenses.