A person who lacks the mental capacity to enter a tenancy agreement may still be entitled to housing benefit, says Robert Latham
If a person lacks the capacity under the Mental Capacity Act 2005 to enter a tenancy agreement, what do you do? A recent decision of the Upper Tribunal of the Administrative Appeals Chamber is a cautionary tale.
EM is 20 and profoundly physically and mentally disabled. She has round-the-clock care and lives in a home that was specially constructed for her by her parents. EM’s parents could only afford to provide the home if they received rent from their daughter in the form of housing benefit. Worcestershire Council, which would otherwise have had to pay for alternative accommodation for EM, approved of this arrangement.
Wychavon Council, however, argued that, as EM lacked capacity, the tenancy agreement with her parents was void and that there was no liability to pay rent and no entitlement to housing benefit. On 29 March 2011, Judge Mark upheld this decision.
On 6 January, the judge was persuaded to review his decision. He decided that, even though there was no contractual obligation to pay rent, EM was obliged to pay for ‘necessary goods and services’ at common law and under the Mental Capacity Act and was therefore entitled to housing benefit.
The judge said it was unfortunate that arguments as to which council should provide for EM had led to a series of appeals at public expense.
The normal solution would have been for someone to sign the tenancy agreement on EM’s behalf. Strictly, this can only be done if authorised by the Court of Protection unless there is a valid power of attorney. But this is costly in cash-strapped times.
Robert Latham is a barrister at Doughty Street Chambers