Wildtree Hotels Ltd v Harrow LBC [2001] 2 AC 1

A local authority argued it lacked resources to comply with a repairs notice for homeless accommodation it managed. The House of Lords held the statutory duty to repair under the Housing Act 1985 was mandatory and could not be avoided by financial constraints.

Facts

Wildtree Hotels Ltd and other companies owned properties which they leased to Harrow London Borough Council (Harrow LBC) for use as temporary accommodation for homeless families. The properties fell into a state of serious disrepair, rendering them unfit for human habitation. An environmental health officer, employed by Harrow LBC, determined that the council itself was the ‘person having control’ of the properties under the Housing Act 1985. Consequently, the officer served a repairs notice on Harrow LBC under section 189 of the Act, requiring it to carry out the necessary works.

Harrow LBC challenged its own notice, seeking judicial review to have it quashed. The council’s primary argument was that it lacked the financial resources to comply with the notice. It claimed that carrying out the repairs would force it to divert funds from other essential services, a decision it argued was irrational and beyond its powers, particularly in light of its general duty to manage its financial affairs under section 111 of the Local Government Act 1972.

Issues

The central legal issue before the House of Lords was whether a local authority’s clear and specific statutory duty under section 189 of the Housing Act 1985 to remedy housing unfitness could be lawfully avoided on the grounds of insufficient financial resources. The case considered the relationship between a specific, mandatory duty imposed by Parliament and a local authority’s general discretionary powers concerning resource allocation.

Judgment

The House of Lords unanimously dismissed the council’s appeal, affirming the Court of Appeal’s decision that the repairs notice was valid and the duty to comply was mandatory. The leading judgment was delivered by Lord Hoffmann.

Lord Hoffmann’s Reasoning

Lord Hoffmann distinguished between two types of statutory duties imposed on local authorities. The first type involves broad duties, such as those in social services, which confer a wide discretion on the authority regarding policy and the allocation of resources. Decisions made under these powers are subject to judicial review only on grounds of ‘Wednesbury unreasonableness’.

The second type, which included the duty under section 189, is a specific and unqualified duty. Where the statutory conditions are met (i.e., a property is unfit for habitation), the authority is obliged to act. Lord Hoffmann held that Parliament had already made the policy decision by enacting the specific duty, leaving no room for the local authority to conduct a balancing exercise based on its resources.

He decisively rejected the council’s argument that a lack of resources could excuse non-compliance, stating that this was tantamount to claiming a power to ignore legislation. He made a powerful constitutional point:

The council’s argument is in my opinion a plea for a general power to be able to suspend or disregard legislation on the ground that it cannot afford to comply with it. But the constitutional principle is that the Crown has no power to dispense with the laws of the land. The council is a creature of statute and has only the powers which have been conferred upon it by Parliament. It cannot rely upon a supposed inherent jurisdiction to decline to perform its statutory duties.

He further clarified that while the word ‘may’ in section 190(1) (‘the local housing authority may themselves do the work’) might suggest discretion, in the context of a public authority’s duty, it should be interpreted as obligatory once the precedent conditions are fulfilled:

In my opinion, it necessarily follows that the power must be exercised. It would be inconsistent with the statutory scheme to construe the power in section 190 as authorising the council to decide that, on grounds of expense, it will not repair the house and leave it to be occupied in a state which the statute has declared to be unacceptable.

Implications

The decision in Wildtree Hotels is a landmark judgment in UK public and constitutional law. It robustly affirms the principle of the rule of law, confirming that a public body, as a creature of statute, cannot ‘plead poverty’ to avoid compliance with a clear and mandatory statutory duty imposed by Parliament. The case establishes a vital precedent that while public authorities have discretion in allocating resources for their general functions, this discretion does not extend to overriding specific, unqualified legal obligations. The ruling has had significant implications for housing standards and the enforcement of statutory duties across all areas of public administration, ensuring that legislated rights and protections cannot be unilaterally set aside by executive bodies on grounds of financial expediency.

Verdict: The council’s appeal was dismissed.

Source: Wildtree Hotels Ltd v Harrow LBC [2001] 2 AC 1