HA 1988 s8 provides for ‘fault evictions’ on both mandatory and discretionary grounds. Of these, the most important is ground 8: if a tenant is two months behind in rent, the court must grant possession. There is no discretion available to the judge here, regardless of the cause of the rent arrears, even if not the fault of the tenant and eminently remediable in short order.

This was affirmed in the case of North British Housing Association Ltd v Matthews [2004] EWCA Civ 1736; February 2005 Legal Action 35. Ms Matthews had received a s8 notice from her landlord, a housing association, seeking possession under ground 8. She argued that was entitled to housing benefit, that an appeal of her benefit claim was outstanding, and that the entirety of the missing rent would be paid. The judge, she argued, should adjourn the matter to allow this to be resolved. However, the judge decided that it was not in his power to adjourn for this purpose. Possession was granted. Ms Matthews’ housing benefit claim was then resolved and the entirety of the missing rent was paid – a month too late.

The judge’s decision not to adjourn was appealed. The Court of Appeal held that this decision was correct. While any adjournment may have the effect of changing the substantive position of the parties, it would be improper for a judge to adjourn a hearing specifically for that purpose. Only in the most exceptional cases ‘might’ an adjournment to resolve rent arrears be allowed. Such exceptional cases include the tenant, bringing to court a sum of cash to pay off the entirety of the arrears, being robbed on their journey. What happens at the next hearing, when the tenant is still without their stolen money, was not explained in the judgment.

Maladministration in the benefits system was not such an exceptional circumstance: it was ‘widespread’ (para 32). Tenants reliant on benefits must accept such maladministration as a matter of course, as well as the resulting possession claims. Although these events are entirely and expressly out of their control, this is no defence.

Clearly, such a precedent has great practical significance, especially (but not exclusively) for benefits claimants. While statistics recording the number of s8 ground 8 possession orders are not available, we can estimate the potential harm.

Universal credit errors are common. Nine per cent of universal credit claims were underpaid in the 2023 financial year, mostly due to official error.2Fraud and error in the benefit system financial year ending (FYE) 2023, Department for Work and Pensions, 11 May 2023. While in 2023 only around 60 per cent of universal credit claims included the rent-designated housing element,3UC households 3 – month by housing entitlement, Department for Work and Pensions, 13 February 2024. these were overrepresented in underpaid claims: the largest cause of claimant error was ‘[f]ailure to provide evidence of rent or under-declared rent and/or service charges’.4Fraud and error in the benefit system financial year ending (FYE) 2023, ibid. In practice, these errors are often due to administrative misunderstandings.5See, for example, Written evidence from Child Poverty Action Group (UCU0118), Universal Credit Update Inquiry, Work and Pensions Select Committee, 30 March 2017. Erroneous payments therefore leave hundreds of thousands of tenants potentially exposed to the ‘draconian’ consequences of Matthews.

The actual figure is of vulnerable claimants is likely far higher. Not all rent arrears are the result of underpayment; some are due to correct payment delayed. Such delays are not always unintentional – new universal credit claims are not paid for five weeks as a matter of policy, which contributes to rent arrears for ‘the majority’ of universal credit claimants.6Michael John-Hopkins, ‘Administrative discretion to adjourn possession claims where universal credit leads to serious rental arrears’, Civil Justice Quarterly, vol 41.1, 2022, page 6. However, this delay is regularly extended. In April 2023, five per cent of universal credit claimants did not receive their full payments on time, rising to 16 per cent for new claimants.7Universal credit: 29 April 2013 to 13 July 2023, Department for Work and Pensions, 15 August 2023. This further contributes to rent arrears.

An indirect consequence of such delays is to drive up rent prices in general. Despite Tyler v Paul Carr Estate Agents [2020] EW Misc 30 (CC); November 2020 Legal Action 40 establishing the unlawfulness of refusing to rent to benefits claimants, both landlords and estate agents remain unwilling to accept such tenants. A major factor in this unwillingness is the delays of the benefits system.8Can private landlords refuse to let to benefit claimants and people with children?, House of Commons Library Research Briefing No CBP07008, 30 October 2023. This reduces the number of tenancies available to benefits claimants, increasing demand and, with it, rent prices. Higher prices naturally increase the likelihood of arrears.

As a result, hundreds of thousands of tenants are vulnerable to possession claims based on rent arrears arising from delays or maladministration in universal credit claims. For these tenants, Matthews looms large.

Fortunately, those in social housing avoid the brunt of this precedent: the Pre-Action Protocol for Possession Claims by Social Landlords requires that possession proceedings should not be commenced if a tenant with a ‘reasonable expectation of eligibility’ has provided all the necessary evidence for a claim to the Department for Work and Pensions, although ignoring this for the mandatory ground 8 does not leave the claim exposed to strike-out or dismissal (paras 2.6 and 2.14). Adjournment is possible, however, and there would also be human rights considerations, along the lines of Manchester City Council v Pinnock [2010] UKSC 45; December 2010 Legal Action 34.

Both the Court of Appeal and the first instance judge in Matthews noted that ‘it is for parliament and not for the court to address’ the injustice of the present system (see para 37 of the Court of Appeal judgment). The Renters (Reform) Bill contains an attempt to do precisely that.

While it does not give the courts the power to adjourn, the bill does contain reforms to ground 8 that include the provision that:

This has the effect of partially offsetting Matthews. A tenant whose housing element claim had been accepted but delayed, if they could demonstrate this in court, would be able to ignore those arrears and potentially resist a ground 8 claim. Possession, then, would not be granted and injustice would be avoided.

It is arguable that cases of actual maladministration would also fall under this heading. A tenant could argue that a potential universal credit award presently the subject of a dispute should also be offset. They would need to demonstrate their entitlement in court – a not-insignificant evidential burden, given the technicalities of universal credit entitlements. There would also be an interpretive issue: is rent unpaid in such circumstances ‘only’ because the tenant has not yet received it?

The Renters (Reform) Bill therefore offers a partial solution to the problems established by Matthews. At least some of those who would suffer from its ‘outrageously unjust’ impact would have a remedy. Ground 8 evictions arising purely from universal credit delays may be facing a happy extinction.

However, the protection does not go far enough. Legislative clarity is needed to avoid interpretive issues around disputed benefits claims, and protection should be extended to also include vulnerable housing benefit claimants.

Such a remedy is all the more important given the other provisions of the bill regarding s21. However, it will have limited effect while benefits themselves remain so far below the market rate for rent.15Craig Berry, The impact of freezing local housing allowance: the autumn statement must address the hidden housing tax, Citizens Advice, October 2023. Nonetheless, it is a welcome step in the right direction – and if this bill is not passed, Matthews should be confronted another way.