Are housing associations 'public bodies'? The debate continues

Keen followers of social housing news will remember the memorable case of R (Weaver) V London and Quadrant Housing in 2009. Although fact-specific, the finding in that case that L&Q were exercising a public function in that case sent shock waves through all involved in social housing. However, once the dust had been allowed to settle and the judgment was properly analysed, Weaver was found not to be as alarming as first impressions suggested. Although, what followed has been a considerable amount of uncertainty, with many in the sector hoping that clarity would be given at some stage.

Some clarity seemingly came in October 2015, with the Office for National Statistics classifying English housing associations as ''Public Non-Financial Corporations'' and indicating that this classification would be backdated to 2008. But seemingly this reclassification is being considered and is arguably a particular financial classification, rather than being a definitive and conclusive declaration.

The latest case to look at the issue is R ( Macleod) v The Governors of the Peabody Trust [ 2016] EWHC 737 ( Admin). Mr Macleod was granted a tenancy of his property in 2009 by his then landlord, the  Crown Estate Commissioners ("CEC"). In 2011 CEC transferred some of its housing stock to Peabody, which included Mr Macleod's property. In July 2015 Mr Macleod requested an exchange of his tenancy with a tenant of a property in Edinburgh - Peabody rejected the request. Mr Macleod claimed that, as a public body, Peabody's decision to refuse the exchange could be the subject to judicial review. Mr Macleod further claimed that Peabody had failed to follow its own policy on mutual exchanges and did not have regard to its duties under Section 149 of the Equality Act 2010.

In order to determine whether Peabody was in fact a public body, the court considered the nature and status of CEC. Whilst no specific evidence was provided, it was clear that the transfer of the properties was subject to a Nominations Agreement, which restricted Peabody to letting the properties to "key workers" at 80% of the current market rent, in addition to granting the tenants enhanced right of succession.

The court therefore decided that Peabody were not exercising a public function in relation to the tenancy of Mr Macleod for the following reasons:

  • Peabody did not purchase the properties from CEC using public money.
  • The properties purchased from CEC were not pure social housing. 
  • This matter was distinguished from Weaver as Peabody had no allocation relationship with any local authority.
  • Rents for the properties transferred from CEC were not subject to the same level of statutory regulation as social housing.

Given the facts of this case, this outcome is not surprising. It is a case that further emphasises that, in the lack of any definitive declaration, the lack of certainty remains. The best advice has to continue to be that housing associations should continue to exercise caution and, if in doubt, err on the side of caution. 

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