A decision that a homeless applicant was intentionally homeless was quashed as the local authority did not assess the applicant's disposable income correctly.
Homelessness case law summary
Summary
This decision has been partially superseded.
The local authority did not follow the correct approach when deciding if a homeless applicant's accommodation was affordable.
The authority did not look at the applicant’s actual income and expenditure. This led it to find that she was intentionally homeless because she had failed to pay her rent on her previous accommodation.
This court decision was made under the 2006 Homelessness Code of Guidance.
Background
Ms Samuels was a private tenant until July 2011 when she received notice to leave from her landlord. The notice was given on rent arrears grounds.
Ms Samuels applied to Birmingham City Council for homelessness assistance with her four dependent children.
The arrears were caused because her housing benefit did not cover the full contractual rent. The local authority found that Ms Samuels had become intentionally homeless. It said the loss of her home had been caused by her deliberate act of failing to pay the rent.
The court's decision
The Supreme Court allowed Ms Samuels' appeal and quashed Birmingham's review decision.
It held that the council officer should have assessed Ms Samuels’ reasonable living expenses including the needs of the children and their welfare, and not whether they had flexibility in their budget to pay the shortfall in rent.
Housing was not affordable if the applicant was left with less money than they would be entitled to under jobseekers' allowance (JSA) or income support.
The approach a local authority must take
A local authority must take into account the factors set out in the Homelessness (Suitability of Accommodation) Order 1996 (Suitability Order). They include the financial resources available to that person including salary and social security benefits.
The Order says the authority should consider the costs of the accommodation including, but not limited to, payments of rent and the person’s other reasonable living expenses.
The 2006 Code of Guidance
The relevant guidance at the time was the 2006 Homelessness Code of Guidance.
Paragraph 17.40 of the 2006 Code recommended that housing authorities regard accommodation as not being affordable if:
'the applicant would be left with a residual income which would be less than the level of income support or income-based JSA that is applicable in respect of the applicant.
Housing authorities should consider whether the applicant can afford the housing costs without being deprived of basic essentials such as food, clothing, heating transport, and other essentials.'
Reasonable living expenses
Ms Samuels’ reasonable living expenses were within the amount she was entitled to through welfare benefits.
The court concluded that ‘in the absence of any other source of objective guidance on this issue, it is difficult to see by what standard that level of expenses could be regarded as other than reasonable.’
Comment
The Supreme Court remarked on the need for an objective assessment of affordability and what constitutes reasonable living expenses.
The reviewing officer considered if there was sufficient flexibility in Ms Samuels' budget for her to cope with the shortfall between the rent and housing benefit. Instead, the reviewing officer should have assessed their reasonable living expenses, having regard to the needs of the applicant and her children, including the promotion of the children's welfare.
This case was decided under the 2006 Code. Appeals about decisions under the 2018 Code of Guidance have been stricter on homeless applicant's expenditure.
For example, see: