FREE CHAPTER from ‘A Practical Guide to Succession to Social Housing Tenancies’ by Stephanie Lovegrove

CHAPTER TWO – WHAT IS TENANCY SUCCESSION?

We touched upon it in the introduction in brief terms. Essentially, succession to a tenancy is the process by which a tenancy passes on the death of the tenant to a person “qualified to succeed” to it. Sometimes, that person is selected by the tenant (e.g., in their will) or the person succeeds automatically under a statutory provision (for example if they lived with the tenant for a period of time before their death and they are a qualifying family member) or the landlord has chosen who is entitled to succeed in the terms and conditions of the tenancy agreement signed by the original tenant.

We will look at the specific methods by which succession to certain types of social housing tenancies happens in later chapters.

This chapter is concerned with the “nuts and bolts” of the law of estates, wills and intestacy which dictate what happens to a tenancy on death. It’s not an easy (or even settled!) area of law, but you need to understand it to be able to grapple with the technical aspects of a succession case. It is the “bedrock” on which contractual and statutory succession to social housing tenancies is built in England (and was – until recently – in Wales).

What happens to a tenancy when the tenant dies?

We are not concerned with tenancies at will in this book (which is helpful because the law is different concerning what happens on death with those types of tenancy). For any other tenancy (by which we mean exclusive occupation of defined land/property granted for a term of years – in context – for a rent) on the death of the tenant, the tenancy does not come to an end (the technical term for which is “determine” which I will use throughout this book).

But why does it not determine? Surely, if there is no tenant, there cannot be a tenancy? The starting point is in the nature of tenancies. They arise by contract (a grant of tenancy) and the contract (at least initially) governs the terms of the tenancy but the tenancy itself is an “estate in land” – it is a form of tenure (how land is held or owned) carved out of another larger form of tenure (so, a freehold owner might – by contract – carve out a time-limited portion of his freehold by way of a lease of say 999 years; in turn that leasehold owner can carve out a smaller form of tenure in a 125-year lease and so on). The point we take from this is that a tenant is not merely a person who agrees to occupy land belonging to another, but in fact (in the case of a legal tenancy) holds a time-limited part of the freehold, a term of years absolute, or a lease/tenancy which is itself one of only two legally recognised estates in land: Law of Property Act 1925, s.1(1), the other being the fee simple absolute in possession.

To develop the concept further, “real property” (a historic term derived from the Latin “res” meaning “thing”) concerns immovable things such as land and those things attached to land like buildings. It is distinct from “personal property” meaning, broadly, anything which is not real property; moveable things such as a car (tangible) or stocks and shares (intangible). There is yet a further distinction within the category of personal property: chattels real and chattels personal. One might think that a tenancy – being an estate in land – would be “real property” but that is not so. Largely as a result of its time-limited nature, leases historically were categorised as “personal property” and became the main component of the sub-category “chattels real” (alongside other specific interests in land). Any personal property which is not a lease or other specified interest in land is therefore part of the “chattels personal” sub-category.

Why do we need to know this? Because it helps with understanding the terminology used in the Administration of Estates Act 1925 (“AEA 1925”) – the source of law governing what happens to tenancies on death (amongst other things). They do not end because they become part of the deceased’s “estate” on death.

So many estates, so many different contexts…

Administration of Estates Act 1925

On the death of a tenant, his “real estate” devolves on his personal representatives: s.1(1), AEA 1925. The Act defines real estate as including chattels real (i.e., leaseholds): s.3, AEA 1925.

Pausing there, the tenant’s tenancy (being a chattel real and therefore part of his real estate) devolves on his personal representatives: what does it mean for his real estate to devolve, and who are his personal representatives?

There is no definition of “devolve” in the AEA 1925. The Oxford Dictionary of Law defines it as “[t]he passing of property from one owner to another, which may occur on death or sale, as a gift by operation of law or in any other way” and the phrase is used interchangeably with “vests” (meaning inter alia “to confer legal ownership of land on someone”) in many of the leading textbooks. In essence, it means the tenancy passes to the personal representative to deal with as a representative of the deceased.

In the Act, unless the context otherwise requires, “personal representative” means: “the executor, original or by representation, or administrator for the time being of a deceased person […]”: s.55(1)(xi), AEA 1925.

So, does this happen automatically on the death of the tenant? It depends. If the tenant made a will and there is an executor with the power to obtain probate, the tenancy will vest in the executor under that will automatically on death: Collis v Flower [1921] 1 K.B. 409; Abbey v Barnstyn [1930] 1 K.B. 660. This is because probate merely proves the will – it does not confer executorship which is derived from the will itself. However, if the tenant died without making a will (referred to as “intestate”) then no, it cannot vest in the administrator automatically, because to become an administrator, a person must apply to the court for appointment as such (“taking out letters of administration”): see Whitehead v Palmer [1908] 1 K.B. 151. There are no other formalities required: death of a testator tenant + executor = tenancy vests in the executor; death of an intestate tenant + letters of administration taken out by an administrator = tenancy vests in the administrator.

One point to note here (which will become relevant later in the context of ending assured tenancies where there is no succession) is that when letters of administration are granted, the law treats the title of the administrator as having arisen at the time of death: In the Goods of Pryse [1902] P. 301; Youngmin v Heath [1974] 1 W.L.R. 135. This is known as the doctrine of “relation back”.

Youngmin v Heath concerned a claim, not for possession of property but rather rent payable in respect of a tenancy of that property where the tenant had died intestate. Mr Heath had taken out letters of administration. On the landlord’s claim for rent arrears, Lord Denning held the following:

1. On the death intestate of the tenant, the tenancy did not determine and instead vested in what was then the Probate judge but is now the Public Trustee: see s.9, AEA 1925.

2. When letters of administration were granted, the administrator became entitled to the tenancy in that capacity and his title related back to the time when the tenant died: see In The Goods of Pryse [1904] P. 301. The effect of this was that the administrator was – as administrator – entitled to the tenancy from the very moment the tenant died.

3. It is an implied term of a tenancy that the obligation to pay rent continues during the currency of the tenancy which binds the tenant and his personal representative to pay rent so long as the tenancy continues — that is until it is determined by proper notice to terminate it. The personal representative must fulfil the obligation to pay the rent, but only to the extent of the assets in his hands: see Williams on Executors and Administrators. 14th ed. (1960), vol. 2, p. 1032; and Megarry and Wade, The Law of Real Property, 3rd ed. (1966). p. 733.

Therefore, in this case, the administrator was liable for the rent (to the extent of the deceased’s assets) until the tenancy was properly determined by notice to quit. This doctrine was relied on in Fred Long & Sons v Burgess [1950] 1 K.B. 115 to argue unsuccessfully that where a tenancy had vested in the administrator, a notice to quit was ineffective to end a tenancy. The Court held that relation-back did not defeat a prior validly served notice to quit.

But what happens to the tenancy where a tenant dies intestate and an administrator has yet to be appointed, or where there is a will but no executor with the power to obtain probate?

Enter the Public Trustee…

The role of the Public Trustee

By s.9(1) and (2), AEA 1925,¹

“(1) Where a person dies intestate, his real and personal estate shall vest in the Public Trustee until the grant of administration.

(2) Where a testator dies and—

(a) at the time of his death there is no executor with the power to obtain probate of the will, or

(b) at any time before probate of the will is granted there ceases to be any executor with power to obtain probate,

the real and personal estate of which he disposes by the will shall vest in the Public Trustee until the grant of representation.”

“The vesting of real or personal estate in the Public Trustee by virtue of this section does not confer on him any beneficial interest in, or impose on him any duty, obligation or liability in respect of, the property”: s.9(3), AEA 1925. The Public Trustee therefore essentially acts as a “repository of title”; a shelf on which the tenancy sits awaiting its vesting in the administrator or, less commonly, a newly appointed executor. Some older cases refer to title vesting in the “President of the Family Division” which was the previous such “repository of title” in similar circumstances prior to 1995.

Who might be a successor?

In many cases, the relevant provisions of the statutory schemes in England governing both fixed-term and periodic secure tenancies, and assured tenancies which are periodic or for a fixed term of not less than two years and which contain an express term for succession, will determine who is entitled to succeed (whether directly or by giving effect to express terms in the tenancy agreement). In Wales, the statutory scheme insofar as it applies to social rented occupation contracts only concerns periodic contracts. This is dealt with in detail in the relevant chapters.

In England, fixed-term secure tenancies (including flexible tenancies) devolve in the manner described above under the tenant’s will or under the intestacy rules: s.90, Housing Act 1985. However, if they devolve on a person not entitled to succeed under s.89, they cease to be secure and (if granted after 2012) they can be ended by service of a notice. If granted before 1.4.12, it may be much harder to recover possession from a non-qualified successor if there is no break clause or other means of bringing the tenancy to an end. The lease terms will govern and should be checked through with a fine-tooth comb.

Categories of successor

In broad terms, for periodic tenancies, the English statutes treat survivorship (where one joint tenant dies) as succession and, after 31.3.12, only permit succession otherwise to spouses or civil partners residing with the tenant when s/he dies, or to family members (including those living with the tenant as if they were married or in a civil partnership), in the absence of such a spouse etc. if the tenancy agreement expressly provides for such a succession: s.86A, Housing Act 1985 (inserted by Localism Act 2011). If the tenancy was granted before 1.4.12, prescribed family members qualify to succeed if they resided with the tenant when s/he dies and also resided with them for the period of a year immediately before their death: s.87, Housing Act 1985.

Since 1.12.22, in Wales, similar categories of persons qualify as successors, with spouses etc. taking priority and other family members being in reserve. Qualifying carers now form a category of successor too: RH(W) Act 2016, ss.73-83 and 139.

But what if a tenant e.g., wills his tenancy to his resident daughter who lived with him for six months immediately before his death, but the resident son lived there for more than 12 months before death? This is dealt with by the main statutory schemes in the following way. Where a person is entitled to succeed under the statute the tenancy vests in that successor automatically and there is no vesting under the will or on intestacy: see s.17(1), Housing Act 1988 as an example (dealt with in Chapter 4).

It is important to appreciate that in the context of most social housing tenancies, the statute itself dictates the qualifying successor but there may e.g., be more than one which qualifies (see the relevant chapters on secure, assured and other tenancies and succession in Wales) to succeed under the tenancy or the contract may provide for selection. In such cases, if a person is named in the former tenant’s will or would be entitled under the intestacy rules (see s.46, AEA 1925) this may affect the selection if, in default of agreement, it is left to the local authority (in the case of secure tenancies) or the court (in the case of assured tenancies) to select the person who succeeds.

How does the successor get the tenancy?

A successor now obtains the tenancy by operation of the applicable statutory scheme where relevant.

Where a statutory scheme does not apply, it is established authority that neither a legatee or devisee of leaseholds (meaning the person entitled under the will to the tenancy) nor a person entitled to a tenancy under the intestacy rules becomes the tenant at law or in equity² until the executor(s) or administrator(s) have assented to the bequest: see Clarion Housing Association v Carter [2021] EWHC 2890 (QB); [2022] H.L.R. 10 considered later in Chapter 4.

The assent must be in writing, signed by all the personal representatives who have proved: see Administration of Estates Act 1925 ss.36(4), 2(2).

What if there is no successor?

This will be explored in more detail in the chapter on possession proceedings, but it will suffice for present purposes to set out the basic position.

In the case of a will/executor, it is likely that any tenancy of little value will simply be ended by the executor serving notice to quit on the landlord. If this is not done, then the landlord must take steps to end the tenancy.

If the tenancy is a fixed-term tenancy, the landlord may have to activate any break clause or rely on the death of the tenant as a basis for re-entry. Service of a notice to quit will be of no assistance because they apply to periodic tenancies.

It is the case with periodic tenancies that they continue after the tenant’s death: Parker d. Walker v Constable (1769) 3 Wils. 25. Resultantly, the landlord must determine the tenancy by notice to quit before seeking possession: Wirral BC v Smith (1981–82) 4 H.L.R. 81 CA. Thus, the one thing the Public Trustee can do during this period is receive a copy of a notice to quit (necessarily from the landlord) to end the tenancy vested in him: Epping Forest D.C. v Pomphrett [1990] 2 E.G.L.R. 46.

For assured tenancies, where a notice to quit is not served and the tenancy is assented to a person in occupation of the property as his or her only or principal home but who is not entitled to succeed, the landlord can rely on Ground 7, Housing Act 1988.

Points to note:

• Tenancies do not end on the death of the tenant. They continue until terminated in accordance with their terms.

• A tenancy forms part of a deceased person’s “real estate” and devolves in accordance with either his or her will or under the rules of intestacy.

• If a tenant dies testate (with a will), the property devolves on his executors if they exist.

• If there are no executors or the tenant dies intestate, the tenancy devolves on the Public Trustee until an administrator is appointed at which point it vests in him or her.

• The position in Wales is now dealt with compositely with little to no scope for the application of common law or statutory rules on inheritance.

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