Scottish Sheriff Court Decisions

1

This is a summary cause action for recovery of possession of subjects at 25 Glenburn Road, North Berwick ("the subjects"), in which the pursuer is East Lothian Council, who are the heritable proprietors and landlords of the subjects. The action is brought against Barry Duffy and Jacqueline Duffy, who reside at "Sequoia", Lennoxlove Estate, Haddington but who are, or at least, were, the tenants of the subjects (hereinafter, "the defenders"). The tenancy in question is a Scottish Secure Tenancy in terms of the Housing (Scotland) Act 2001 ("the 2001 Act"). Also party to the action are Alan Cockburn and Leigh Burn, who reside in the subjects and who are therefore "qualifying occupiers" (and hereinafter referred to as such) by virtue of section 14(6)(b) of the 2001 Act. They were sisted as parties to the action under section 15 of the 2001 Act and have assumed the defence of it. It is not in dispute that the subjects lie within the jurisdiction of this court.

2

After sundry procedure, the action called before me for proof on 1 and 30 March and 12 April 2012. The pursuers were represented by Mr Wilson, and the qualifying occupiers by Mrs Corsar, both solicitors. The defenders appeared, unrepresented, on the first day of the proof, but made it clear that they had no interest in participating in the proof in the sense of examining witnesses or making submissions. Mrs Duffy gave evidence for the qualifying occupiers, following which the defenders chose to play no further part in the action.

3

By and large, with several exceptions discussed below, the factual background was not in dispute at the proof. Much of the evidence was agreed by joint minute, and even then much of the evidence which was led consisted of the witnesses speaking to facts and documents which had already been agreed. As the defenders have long since vacated the subjects and have no intention of returning, the real question for determination is whether the pursuers are entitled to recover possession from the qualifying occupiers.

4

In determining that question, various legal issues arise. These include: the nature of the right of a qualifying occupier in an action such as this; the relevance of the pursuer's previous refusal to consent to an assignation of the lease to the qualifying occupiers; whether the lease was terminated by the defenders' intimation to the pursuers that they did not intend to return to the subjects; and the approach to be taken to the assessment of reasonableness.

5

Finally, since much was made of it at the proof, it is pertinent to mention the previous action raised by the defenders, namely a summary application appealing against the said refusal by the pursuer to assign the lease to the qualifying occupiers. That application was raised in 2009, was thereafter sisted and was eventually dismissed following the lodging of a joint minute in which the pursuer and defenders agreed to that disposal. The qualifying occupiers were not party to those proceedings.

6

The following material facts were either agreed by joint minute, or accepted in evidence to be non-controversial.

6.1

The tenancy agreement (styled "missive of let") between the pursuer and defenders over the subjects was executed on 25 May 2002. A copy of it is number 5/22 of process. It provided at paragraph 1 that the lease commenced on 18th February 2002 "and shall be terminated by either party giving to the other twenty eight days notice in writing of termination". The lease was therefore of indefinite duration with no ish and provided for a break on either side of 28 days' notice. No definite ish was implied into the agreement.

6.2

Permission was granted by the pursuer to the defenders, following receipt of the defenders' written application (5/2 of process) and sundry correspondence thereafter (5.3 to 5/5 of process), to sub-let the subjects to the qualifying occupiers from 4 August 2008 to 2 August 2009. The pursuer's consent was communicated to the defenders by letter dated 25 July 2008 (5/6 of process). It was a specific condition of the pursuer's permission, that the sub-let would be granted for a period of up to one year after which the defenders would require to return to the property or arrange to terminate the tenancy. It was a further condition of the pursuer's permission that should the defenders decide to terminate before or on the expiry date of the sub-let then the qualifying occupiers would not have rights to succeed to the tenancy.

6.3

The pursuer wrote to the qualifying occupiers on 21 August 2008, confirming the basis of the agreement to sub-let. In particular, the letter stated that:

"...the council is prepared to allow you to sub-let [the subjects] for a period of one year, commencing on Monday 4 August 2008. When the sub-let expires on Sunday 2 August 2009 you will be required to leave the accommodation as the tenant will be required to resume living in the property."

6.4

By letter dated 14^th July 2009 (5/9 of process) the defenders advised the pursuer that they had secured alternative accommodation elsewhere and no longer required the subjects. In particular, the letter stated:

"...we have been given a 3 bedroom house through our work - so we will not be returning to [the subjects] on the 4^th of August 2009. We would be very grateful if you could help out Mr Cockburn and Miss Burn with their housing problem...."

6.5

The pursuer issued a letter dated 15 July 2009 (5/10 of process) in which it purported to acknowledge notification to end the tenancy as of 12 August 2009. The letter stated:

"I acknowledge your notification to end the above tenancy as of 12 August 2009...All keys must be returned to this office by 10.00am on 12^th August 2009. If the keys are returned late, then your tenancy will continue until the day after they are handed in."

6.6

The defenders have remained absent from the subjects since 12 August 2009.

6.7

The qualifying occupiers have continued to reside in the subjects following the expiry of the sub-let.

6.8

By letter dated 22 July 2009 (5/11 of process) the defenders requested consent for assignation of the tenancy to the qualifying occupiers. By letter dated 29 July 2009 (5/12 of process) the pursuer refused this request. The reasons for refusal as aforesaid were stated as follows:

"You have advised us you have no intention of returning to the tenancy and had already agreed to terminate the tenancy if you did not return.

You have already decided to terminate your tenancy before expiry of the termination of the existing sub-let.

This is set out in the sub- let agreement signed by you both on 29.7.08"

6.10

The defenders raised a summary application (B283/09) appealing against the refusal and ordaining the pursuer to assign the tenancy. A copy of the application is item number 1 on the qualifying occupiers' third inventory of productions. These proceedings were dismissed in terms of interlocutor dated 7 November 2011 (No 5/21 of process).

6.11

On 14 November 2010 notices of proceedings for recovery of possession of the subjects were served personally on the defenders. On 15 November 2010 notices of proceedings for recovery of possession of the subjects were served personally on the qualifying occupiers. These notices were served in terms of section 14 of the Housing (Scotland) Act 2001 and informed the defenders and qualifying occupiers that the pursuer may raise proceedings for the recovery of possession within the statutory six month period on the ground that the defenders had been absent from the subjects without reasonable cause for a continuous period exceeding 6 months or had ceased to occupy the house as their principal home. Copies of the notices are appended to the summons.

6.12

The present proceedings were duly raised within 6 months of the required date.

6.13

The qualifying occupiers have no rental account with the pursuer. During the period of the sub-let the defenders remained responsible for all aspects of the tenancy including rental payments.

6.14

The pursuer's written guidance recommends that tenants who are sub-letting arrange for the sub-tenant to pay rent to the tenant by direct debit or standing order and that the tenant continue to make payment by direct debit to the pursuer into the tenant's rental account.

6.15

The qualifying occupiers during the period of the sub-let chose to set up a standing order and made payment directly to the defenders' rent account. The qualifying occupiers were advised by the pursuer to cancel the standing order payments following the closure of the rental account but have chosen not to and continued making payments. All rental payments due during the period of the sub-let were paid.

6.16

A standing order can only be cancelled by the individual responsible for originally setting it up. As a consequence the standing order payments continued to be received by the pursuer. These payments could not be allocated to the defenders' closed rental account.

6.17

The pursuer has attempted to return those funds received after the closure of the rent account firstly by cheque and thereafter by BACs transfer. The qualifying occupiers failed to cash those cheques and immediately returned funds repaid to them by BACs transfer. The pursuer is currently unable to return funds to the qualifying occupiers as they refuse to accept same. Despite repeated requests to desist the qualifying occupiers continue to pay funds to the pursuer.

6.18

All funds received from the qualifying occupiers following the closure of the rental account on 12^th August 2009 have been placed by the pursuer in a suspense account. No tenancy agreement has been created over the subjects by virtue of payments made by the qualifying occupiers. The payments made by the qualifying occupiers since 12 August 2009 equate in value to the rental payments which would have been due in respect of the property had the rental account not been closed.

7

In addition to the joint minute, both the pursuer and the qualifying occupiers adduced evidence from a number of witnesses. The pursuer led evidence from Calum MacLeod, Community Housing Officer and Linda Rodgers, Community Housing Manager. The qualifying occupiers both gave evidence and also led evidence from Mrs Duffy and Mr Hugh Lynch, a neighbour.

8

Much of the evidence which was led was unnecessary insofar as it consisted either of the witnesses being taken through the various letters and other documents, all of which had been agreed in any event, or leading evidence which was fundamentally uncontroversial and might therefore also have been agreed. I do not propose to rehearse all of the evidence in detail but I will summarise it insofar as material, before turning to the issue of credibility and reliability and how that bears upon the few disputed factual issues.

9

Mr MacLeod, as well as speaking to the documentation, gave evidence about the circumstances surrounding the sub-let. It was he who had given the pursuer's consent to that transaction. He was vague as to whether a copy of the pursuer's leaflet about sub-letting, No 5/16 of process, had been given to the parties at the time (although of course it could not have been, having been issued only in 2010). He also gave evidence about what happened around the time the defenders intimated they did not intend to return. He accepted that he had been told that Leigh Burn had attended at the pursuer's North Berwick office on 8 July 2009, asking if she and Mr Cockburn could take over the tenancy, and that 5/8 of process was a customer enquiry street pertaining to that attendance. He denied having told her, when he later spoke to her, that there was "no chance" of the qualifying occupiers acquiring the subjects by assignation, although there was a very small chance he might have said that. He had been passed the defenders' letter 5/9 of process. Because of the terms upon which the sub-let had been agreed to, he took the view that the defenders were bound to terminate their lease, and therefore wrote the letter 5/10 of process, dated 15 July 2009. He said that after sending that letter to the defenders, he had spoken to Mrs Duffy and arranged to carry out an end of tenancy visit on 24 July 2009, the date specified in his letter for such a visit. He had written a brief note of his conversation on his copy of the letter. He had then conducted the end of tenancy visit on 24 July 2009. A male - Mr Cockburn - was present. He, Mr MacLeod, was unable to discuss the assignation request. He told "them" that the lease was to terminate. He was shown round the house. In considering the request to assign, he had based his refusal on the terms of the original agreement. Thereafter, as far as he was concerned the tenancy had come to an end on 12 August 2009. He did not know, or at any rate could not explain, why the letter 5/10 of process (which he wrote) stated that the tenancy would continue until the date the keys were handed in. The lease and letter had been written at different times. It was within the pursuer's discretion to decide whether or not to charge rent beyond the termination date, if keys were not returned. In this case, the keys were never returned. He did not know why the pursuer had subsequently written to the defenders on 22 October 2010 (qualifying occupiers' inventory 5/2/1 of process) asking that the end of tenancy form be completed and returned. He accepted that it could be inferred from that letter that the pursuer took the view that the tenancy had not ended.

10

Mr MacLeod also spoke to the housing applications lodged by the qualifying occupiers with the pursuer, dated 2 June 2009 and 9 November 2011 and respectively 5/17 and 5/19 of process, and to the letters telling them how many points they had (5/18 and 5/20). In summary, his evidence was that the qualifying occupiers have been allocated only 8 points and that consequently there is very little prospect of their ever being awarded a tenancy in North Berwick, or indeed, anywhere in East Lothian. With reference to their applications, he pointed out that they had chosen to apply for houses only in the immediate North Berwick area, and had excluded consideration for most types of housing. By restricting their choice so dramatically, they were reducing still further their prospect of ever being awarded a tenancy. North Berwick was a high demand area. The qualifying occupiers had chosen not to apply for Housing Association properties. The rents for such properties were half as expensive again as local authority houses. In conclusion, Mr MacLeod said he did not think it would be fair if the qualifying occupiers were allowed to continue in occupation of the subjects, which would be tantamount to queue jumping.

11

Ms Rodgers said that she was Mr MacLeod's line manager. The subjects lay within the geographical area for which she was responsible. She spoke to the pursuer's allocations policy, 5/15 of process. It was based on need. It was drawn up in such a way as to ensure that the pursuer complied with its legal obligations. She confirmed that the qualifying occupiers' housing applications severely restricted the properties for which they wished even to be considered. If they applied for a broader type of housing, from a greater range of landlords, they would have more chance of being allocated a house. Their chances of being allocated a local authority house were extremely poor, having only 8 points. There were 35 individuals ahead of them on the waiting list for a property such as the subjects. The person at the head of the queue had 56 points. There was a high demand and low turnover of houses. The pursuer had to abide by its allocations policy. It would be unfair for the qualifying occupiers to be treated more favourably than other sub-tenants, who had left, as agreed, when their sub-lets had expired. She was unaware of any other case where a sub-let had been followed by an assignation to the sub-tenant. Housing Association rents were higher than local authority ones, and private lets more expensive still. In general terms, she was aware of a tenant's right to apply for consent to an assignation. She had written the letter of 22 October 2010. She didn't know why there had been a delay in commencing action. She thought that it was commenced after the summary application had been dismissed. She was unaware that the summary application had not been dismissed until November 2011. She was unaware of the keys ever having been returned.

12

Mrs Duffy explained that the sub-let was requested and entered into because her husband had been offered accommodation in the course of his employment. Within the year, it emerged that that accommodation could become permanent, so they decided not to return to the subjects. She was asked what she meant by her letter of 14 July 2009, (despite that question being of dubious relevance). However, for what it was worth she said that it was not her intention to terminate the tenancy, but to ask for the tenancy to be assigned. She had asked the pursuer in the letter if it could help the qualifying occupiers. By that, she had in mind either that the lease might be assigned or that a tenancy of another property might be offered. Indeed, she and her husband had been offered the tenancy following a sub-let of the property downstairs. She had hoped something similar might be afforded the qualifying occupiers. When she handed the letter in, she also returned one of the sets of keys. The other set was in the possession of the qualifying occupiers. Although she had not intended to terminate the lease, she and her husband had no intention of ever returning to the subjects, and that remained their position. Following the letter of 14 July, they had sought advice from Shelter. As a result of that, the request for an assignation of 22 July 2009 was written. That request was refused. She and her husband had then instructed the lodging of the summary application appealing against the refusal. She had not understood the legal procedure. Neither she nor her husband had agreed to the application being dismissed in November 2011. Shelter, who represented them in that action, had not explained things very well. It was all done over the phone. It was possible that she had agreed to dismissal without appreciating that was what she was doing. Finally, Mrs Duffy was adamant that she had never spoken to Mr MacLeod about an end of tenancy visit, nor was she aware of any such visit ever having taken place.

13

Mr Lynch spoke of the qualifying occupiers in glowing terms. He lived in the property downstairs. They were model neighbours and he would very much like them to continue living there. They could not be more helpful to him. He had signed the petition, contained in the qualifying occupiers' fourth inventory, which Ms Burn had organised and in which many local people had expressed their support for the qualifying occupiers in their quest to remain in the subjects. He was not surprised that there were so many signatories, because they were such nice people.

14

Ms Burn gave evidence about the personal circumstances of Mr Cockburn and herself. They had lived in the subjects since moving in at the start of the sub-let in 2008. Before that, they had lived for 8 years with Mr Cockburn's mother. They did not have children as a couple, although Mr Cockburn had two children from a previous relationship, who visited and sometimes stayed overnight. They had a dog. They were friends of the defenders, and when the latter had to move out, Mr Cockburn and Ms Burn asked if they could sub-let. Ms Burn had always understood that the sub-let was only for a year and that they would have to move out at the end of that period. In about June or July 2009 she had begun making inquiries about alternative accommodation. However, when she discovered the defenders would not be returning she attended the pursuer's North Berwick office and enquired whether there was any prospect of taking the tenancy over. Mr MacLeod had phoned back and said "no chance". She was gutted and sought advice. That was to the effect that it was legal for the defenders to assign the tenancy. It was following that advice that the formal request for consent to an assignation had been made. Insofar as an end of tenancy visit was concerned, she was adamant that no such visit had ever taken place. Certainly she had not met Mr MacLeod at the property. If Mr Cockburn had, he would have told her. She was "150% certain" that Mr MacLeod had not attended the subjects. She emphasised how important the tenancy of the subjects was to her. She worked in North Berwick as a self-employed hairdresser and the majority of her clientele (mainly elderly) resided there. She also had to live close to her mother, who resided in Dirleton. She had about £200 per month after expenses, and received working tax credit of £300 per month. She previously got into financial difficulties and was currently subject to a trust deed for creditors, paying a monthly contribution to the trustee of £145, that having two more years to run. She had a car. Her understanding was that there was no chance of being allocated a local authority tenancy, irrespective of what type of property they applied for, or in what location. She had investigated trying to find properties available for let from landlords other than the pursuer, but they were outwith the price range which she and Mr Cockburn could afford. There were no suitable affordable properties in North Berwick. Prices ranged from £300 to £600 per month. She and Mr Cockburn could not afford a private let, which would be at least £600 per month, plus council tax. There were no relatives with whom they could stay. Although they had previously resided with Mr Cockburn's mother, she had been attempting to become more independent since her husband, Mr Cockburn's father, had died, and so they would not wish to move back in with her. Her own parents, with whom she had a good relationship, had a 3-bedroomed house, but her mother needed the spare bedroom to sleep in from time to time as she experienced pain. Ms Burn felt she was being penalised for not having children, and therefore having less need than other prospective tenants. She, too, needed somewhere to stay. Not all landlords would accept a dog, and if they moved, their dog might have to be put down. Mr Cockburn had contact to his two children, and so they needed a second bedroom. It was Ms Burn who had organised the petition. Places such as Haddington and Dunbar were too far away from North Berwick. Currently she was able to go home between visiting clients, and would no longer be able to do that.

15

Mr Cockburn said that he, too, was self-employed, as a van driver. He lived with Ms Burn at the subjects. His earnings varied from £45 to £300 per week. He agreed that the average monthly household income was about £700. He had two children from a previous relationship who sometimes stayed overnight, his daughter less frequently than his son. He confirmed Ms Burn's evidence that they had previously resided with his mother but would not wish to return there. He left most of the administrative side of things to Ms Burn and he had no real direct knowledge of how easy or difficult it would be to obtain alternative accommodation. She was the one who had explored the availability of other tenancies. He had not himself inquired about housing benefit but was prepared to agree with a question put to him in cross-examination that they might be entitled to housing benefit of £400 per month. It would be calculated only on the basis of a one-bedroomed house, which was deemed sufficient for their requirements. Having been on the waiting list himself for 19 years, he did not think it was fair that properties should be allocated to people who had been on the list for a much shorter period. If he and Ms Burn were evicted they would have nowhere to go. He would not return to live with his mother, under any circumstances. They would probably end up sleeping in his van. As regards any end of tenancy visit, he was absolutely adamant that Mr MacLeod had never attended his house for such a visit.

16

As regards credibility and reliability of the witnesses generally, and the weight to be attached to their evidence, I found Mr Lynch to be utterly credible and reliable. His evidence however is ultimately of little value except insofar as it confirms what the pursuer does not dispute, that the qualifying occupiers would be model tenants if allocated a tenancy of the subjects. However, the views of neighbours have little to do with the issues which arise in the case and for the same reason I attach little weight to the petition which Ms Burn obtained. I also found Ms Rodgers to be credible and mostly reliable and I accept her evidence about the pursuer's allocations policy, although she was vague on matters of detail and (wrongly) thought that the summary application had been concluded by October 2010. She was therefore unable to contribute very much to the specific factual issues arising in this case. As for the remainder of the witnesses, they were all in the main credible and mostly reliable but all had an interest in the outcome of the case, for different reasons, which coloured at least part of the evidence which each of them gave. I did accept Ms Burn and Mr Cockburn as essentially honest, but clearly they (particularly Mr Cockburn, who has been on the waiting list for 19 years and to all intents and purposes is moving backwards on it) feel frustrated that they are unable to be allocated a house in North Berwick and have a general feeling that the allocations policy is unfair, which coloured parts of their evidence. I consider that they perhaps exaggerated the impossibility of their obtaining other acceptable accommodation in East Lothian. While there seems little prospect of their obtaining a property in North Berwick, I am not persuaded that they could not obtain an affordable property elsewhere in East Lothian, which while less convenient would enable them both to continue in their current employments. Much of their evidence was unvouched. Ms Burn's finances will improve when her trust deed has concluded (and increased accommodation costs may result in her contribution being reduced, since the former should help determine the latter, not vice versa). Mr Cockburn did not appear to rule out the possibility of a move to Haddington or Dunbar, were a property there to be offered. As for Mrs Duffy, she was assertive bordering on truculent at various points of her evidence, when questions were put to her which she did not accept. She, too, has an interest in the outcome of the case, in that she has a desire to see her tenancy assigned to the qualifying occupiers. Finally, I turn to Mr MacLeod. He has an interest in the outcome insofar as the pursuer wishes the subjects back so that they can be re-allocated, and moreover his conduct at the time of the sub-let and request for assignation is under scrutiny. At times his evidence was simply unsatisfactory, for example in relation to the sub-letting leaflet which was not published until 2010. He was vague on questions of detail, and the wording of some of his letters, not least the letter of 15 July 2009 itself, is such as to give rise to an inference that he is not averse to manipulating situations to the pursuer's own end. It was somewhat disingenuous of him to treat the letter of 14 July 2009 as an intimation of termination of tenancy, when clearly at best for the pursuer it was ambiguous. Mr MacLeod's attempt to explain his statement in the letter of 15 July that the lease would continue until the keys were handed in, which clearly was inconsistent with his primary position that the lease had come to an end, as being because the lease and the letter were written at different times was incomprehensible, and betrayed an unwillingness to make any concession which might be seen as in any way favourable to the defenders or qualifying occupiers. Then again the letter of 29 July 2009, intimating the refusal of consent, was somewhat infelicitously worded and did not give the impression of all relevant issues having been considered.

17

That leads me on to the principal factual matter on which conflicting evidence was given, namely, whether an end of tenancy visit took place on 24 July 2009. I should say that whether Mr MacLeod visited the property or not seems to me to be immaterial in resolving the issues between the parties, since even if a visit to the property did take place, it was not suggested that either of the tenants was present and any meeting which did take place therefore could not have dealt with the matters which, in terms of the letter of 15 July 2009, such a visit was intended to cover, such as discussing the tenants' obligations. The pursuer was, after all, at pains to ensure that the qualifying occupiers had no rights in or to the tenancy. It was not suggested by Mr MacLeod that anything of any contractual significance was said at the visit. It is therefore in some respects difficult to see why either Mr MacLeod or Mr Cockburn would lie on the issue of whether or not their had been a visit, other than that both perhaps assume the issue to be of greater significance than is in fact the case. Having said that, I did accept Mr MacLeod's evidence that he had spoken to Mrs Duffy on the telephone on 17 July, preferring his evidence to hers on that issue. The note written on the copy of the letter bears that out, since I do not consider that Mr MacLeod would have fabricated such a note. Whether any visit ever took place is much more difficult to resolve. I am inclined to believe Mr Cockburn's assertion that there never was a visit. I reach that view partly having regard to the manner in which he gave his evidence and partly because there is no contemporaneous record of the visit in the pursuer's file. Put another way, if the visit was of such importance as the pursuer suggested, I would expect that to have been recorded in some shape or form. Moreover, it is difficult to see how any discussion between Mr MacLeod and Mr Cockburn could have taken place along the lines suggested by Mr MacLeod, standing that by that time the request for consent to assign had been received but had not yet been determined. It is certainly difficult to accept, as Mr MacLeod would have us believe, that Mr Cockburn meekly accepted that the house would be vacated when he was actively seeking an assignation of the tenancy, and clearly wishes to remain in the subjects. At the very least, one would have expected him to have taken issue with Mr MacLeod, and for Mr MacLeod to have remembered that. If there had been an end of tenancy visit, it is likewise difficult to accept that the issue of return of the keys would not have been addressed. I have therefore come to the view that on a balance of probabilities no visit took place on 24 July 2009, and that Mr MacLeod is mistaken in saying otherwise. Even if I had found that there was a visit, my conclusion on the principal issues in the case would be unaffected since it is not so much the fact of a meeting which is important but what was agreed at it; and the pursuer did not contend that anything of significance was agreed at it.

18

There were only two other factual matters of any real significance which were the subject of conflicting evidence, the first of which was whether or not a set of keys had been returned. Mrs Duffy said she had returned a set when she handed in her letter. Mr MacLeod said no keys had ever been returned. Neither was challenged in cross-examination, but Mrs Duffy had no reason to lie in relation to that part of her evidence, which was if anything against her interest, since the return of all keys in the possession of the tenants might support an argument that her intention as conveyed by her words and deeds was to end the tenancy (contrary to what she said in evidence). The pursuer's letters asking for return of the keys still make some sense, given that one set of keys remained (and remains) with the qualifying occupiers, and it would be understandable that the pursuer required return of all keys, not just one set. I therefore prefer the evidence of Mrs Duffy to that of Mr MacLeod on this matter also, and find that one set of keys was returned with the letter of 14 July 2009, but that no keys have since been handed in to the pursuer. The other disputed matter was whether Mr MacLeod had told Ms Burn that there was "no chance" of her and Mr Cockburn taking over the tenancy. Mr MacLeod did not dispute absolutely that he might have said that, but thought it unlikely. Again I accept Ms Burn's evidence on the point, not least because the phrase in question is merely a pithy encapsulation of what was in fact Mr MacLeod's position, that there was little chance of the qualifying occupiers being allocated that or any other tenancy.

19

Insofar as the witnesses' evidence as set out above was not disputed, I have accepted it as credible and reliable.

20

Against the foregoing factual background, Mr Wilson's primary submission for the pursuer was that decree for recovery of possession of the subjects should be granted in terms of paragraph 5 of Part 1 of Schedule 2 to the 2001 Act. The defenders had been absent from the subjects since 12 August 2009 and had no intention of returning. Decree, if granted, would also require the qualifying occupiers to remove from the subjects. Esto the court was not prepared to grant decree on this ground, it should hold that the defenders terminated their tenancy by the letter of 14 July 2009, in terms of section 12(1)(f) of the said Housing (Scotland ) Act 2001; or alternatively that the tenancy had ended by agreement, in terms of section 12(1)(e) of the Act .

21

In amplification of his primary argument, Mr Wilson reminded me that in terms of section 16(2) of the Act, the court must make an order if the landlord has a ground for recovery as laid out in grounds 1 to 7 and it is reasonable to make the order. Since the existence of the ground was admitted, the issue for determination was that of reasonableness. In determining that, the court must have regard in particular to the factors in section 16(3), and also to all the circumstances relevant to the case

22

Next, Mr Wilson analysed the position in law of the qualifying occupiers. Their sole right, arising from section 15 of the 2001 Act, was merely to be sisted as a party to the action, and to be heard. They had no right to the tenancy nor even a right of occupation. The interests of the qualifying occupiers and the defenders stood or fell together. The position of a qualifying occupier who was not a spouse or co-habitee of the tenant had been considered by Sheriff Ross in Glasgow Housing Association Ltd v McNamara 2008 House.L.R.38 at paragraphs 22 to 24. The facts of that case were that the qualifying occupier was the 18 year old daughter of the tenant, who had been sentenced to four and a half years imprisonment for drug dealing within the property. In holding that it was reasonable to grant decree, Sheriff Ross observed at paragraph 24 of his judgement: "It is necessary to recognise that any interest which the qualifying occupier can protect is not independent of the tenant. The tenancy is not hers. She has no independent right of occupancy of the property. In my view, the right of the qualifying occupier can only be to appear to make such submissions as have a bearing on section 16(2), namely whether a ground for recovery has been established and whether it is reasonable for decree to be granted ...the interests of the tenant and the qualifying occupier stand or fall together - there can be no decree of ejection against the defender without the qualifying occupier being ejected also."

23

The position of the qualifying occupier had also been considered by Adrian Stalker, Advocate in his work Evictions in Scotland at pages 187-189, where he expressed the view that the utility of the right given to a qualifying occupier to enter the process of an eviction action was limited if that person was not a cohabitee or spouse and consequently did not have any expressly conferred right to perform the obligations of the tenant and to have the tenancy transferred to him/her. The occupier's only remedy might be for the tenant to make an application to the landlords under section 32 of the 2001 Act, for consent to assign the tenancy and to argue that the landlord had no reasonable grounds for refusing, and consequently that an order for possession meantime would be unreasonable.

24

In the present action, the qualifying occupiers had no legal right to make payment of rent and the pursuers had no duty to accept same. The pursuer was prejudiced as it could not charge rent, and the person at the top of the waiting list who would otherwise have been entitled to this tenancy was also clearly prejudiced.

25

Turning to reasonableness, Mr Wilson submitted that the court must have regard to the four statutory factors as a starting point but must also consider other relevant factors, and the statutory factors did not attract any specific weight: Fife Council -v- Buchan 2008 HousLR 74 at 20; City of Glasgow District Council -v- Erhaiganoma 1993 SCLR 592 at F. The court was entitled to take all the evidence into account: South Lanarkshire Council -v- Nugent 2008 Hous LR 92.

26

The first statutory factor was the nature, frequency and duration of the conduct taken into account by the court in concluding that the ground is established. In having regard to this factor, the court should have regard to the term of the sub-let that if after one year the defenders had not moved back into the subjects, they would terminate the tenancy. The qualifying occupiers had been aware of that term, and had agreed to it. Having intimated on 14 July 2009 that they would not be returning to the subjects, the defenders had no option other than to terminate the tenancy. The subsequent attempt to assign having failed, the qualifying occupiers remained in the subjects without right or title. The defenders for their part had not terminated their tenancy despite failing to live in the property and failing to pay rent. They had not resided at the property since 2008.

27

The second factor was the extent to which the conduct was conduct of, or was a consequence of acts or omissions of, persons other than the tenant. Here, the responsibility for the conduct and its consequences lay with the defenders, who had removed themselves from the property and had no intention of returning. The qualifying occupiers refused to leave despite knowing that their sub-let had ended.

28

The third factor was the effect which the conduct had had, was having and was likely to have on any person other than the tenant. The qualifying occupiers had little or no prospect of ever being allocated any property in North Berwick, and were presently occupying a property that ought legitimately to fall to another individual.

29

The fourth factor was any action taken by the landlord before raising the proceedings, with a view to securing the cessation of that conduct. The pursuers had requested that the qualifying occupiers voluntarily vacate the subjects but they had refused to do so.

29

Next, Mr Wilson referred to what he referred to as the Lockhart criteria, deriving from the case of Glasgow City -v- Lockhart 1997 Hous LR 99, in which four matters were held to be relevant to the decision to evict. The factors were: public interest; that the defender knew the consequences of what he was doing; the gravity of the offence; and the consequences of eviction. As regards public interest, the pursuer was under a statutory duty, imposed by sections 19 and 20 of the Housing (Scotland) Act 1987 as amended by sections 9 and 10 of the 2001 Act, to allocate houses in accordance with its policy, which in turn was based on need, and it would drive a coach and four through that policy were the subjects to be allocated to the qualifying occupiers. The pursuer had a legal duty to make rules and regulations covering the priority of allocation of houses, transfers and exchanges and to publish these rules (section 21 of the Housing (Scotland) Act 1987 as amended by section 155 of the Leasehold Reform, Housing and Urban Development Act 1993 and the 2001 Act). The pursuer was obliged to allocate its limited housing stock according to its Allocations Policy. The qualifying occupiers would be extremely unlikely to secure a Scottish secure tenancy over the subjects in terms of that policy, scoring 8 points. As for the consequences of eviction for the qualifying occupiers, Mr Wilson accepted that they would be significant, but there was no good reason why they could not move to a more affordable area particularly as they had access to a motor vehicle.

30

As for additional factors, Mr Wilson recognised that the refusal of the assignation request was a relevant factor to take into account but submitted that the pursuer was not unreasonable in refusing that request. It was a term of a Scottish secure tenancy that a tenant may assign the tenancy only with the written consent of the landlord. The procedure to be followed was set out in section 32 and part 2 of schedule 5 of the 2001 Act. Mr Wilson, departing from his original submission, accepted that the letter dated 22nd July 2009 (5/11 of process) was a valid request for an assignation. However, in its response by letter dated 29 July 2009 (5/12 of process), the pursuer had refused the request for assignment on the grounds that the defenders had stated that they had no intention of returning to the tenancy (5/9 of process) and had already agreed in writing to terminate the tenancy if they failed to return. If it were accepted that the defenders had terminated the tenancy by exchange of letters dated 14 and 15 July 2009, then from 12 August 2009 they lost all right to assign as only a tenant can assign. The defenders had been entitled to challenge the decision to refuse the assignation by summary application, as they had done. However, that application was dismissed on 7 November 2011 with the consent of the defenders. The court was not entitled to grant an assignation in terms of the present proceedings. Any challenge to the reasonableness of the pursuer's decision to refuse to consent to an assignation should have been taken in the summary application. As for the reasonableness of the decision to refuse consent, it was important to note that section 32 did not set out an exhaustive list of grounds upon which consent could be refused: Greens Social Work Legislation Volume 2 at page G-123. The refusal was not unreasonable having regard to the terms of the sub-let agreement.

32

Mr Wilson then anticipated an argument that the qualifying occupiers would be rendered homeless by an eviction. He submitted that this would not be the case, for various reasons, as follows. First, they had certain statutory rights which would greatly reduce such a prospect. The pursuer had an interim duty to accommodate (section 29 of the 1987 Housing (Scotland) Act as amended by section 9 of the 2003 Act). It also had a duty to provide Temporary Accommodation with advice and assistance (section 31(3) of the Housing (Scotland) Act 1987). The duty was to secure that accommodation be made available for such period as would give the applicant a reasonable opportunity to find alternative accommodation for him or herself. Further, the qualifying occupiers would appear to have a statutory right to housing benefit and council tax benefit based on the evidence of Mr Cockburn, making alternative accommodation more affordable. While no evidence had been tendered, they might reasonably be expected to receive benefit of £100 per week. The qualifying occupiers also had close family members who could offer temporary accommodation should the need arise.

33

In any event, the court was not entitled to create a tenancy over the subjects. If decree were not granted, the present situation was destined to continue indefinitely. The pursuer could not provide a tenancy since to do so would contravene their allocations policy, nor could they accept rent. The qualifying occupiers would be entitled to continue in occupation indefinitely without right or title to do so.

34

Finally, Mr Wilson dealt with his fall-back submission, which was that the tenancy had terminated as at 12th August 2009. A Scottish Secure tenancy could be brought to an end only in one of the ways prescribed by statute which, as well as including an order for recovery of possession under section 16(2) of the 2001 Act, also included written agreement between the landlord and the tenant in accordance with section 12(1)(e); and 4 weeks' notice given by the tenant to the landlord in accordance with section 12(1)(f).

35

The defenders' letter dated 14 July 2009 (production 5/9) could have been more clearly expressed but it had to be read and construed in its context and its meaning was to be taken as the meaning it would convey to a reasonable reader aware of all the relevant context: Mannai Investment Co ltd v Eagle Star life Assurance Co Ltd 1997 AC 749; Credential Bath Street Ltd v Venture Investment Placement Ltd 2007 CSOH 208. Here, the context was the terms of the sub-let agreement whereby the defenders were either to return at the end of the sub-let or terminate. The sub-let was time-limited. The reference to not coming back and to having another house could only be seen as indicative of an intention to bring the lease to an end. The pursuer had been entitled to construe the letter as notice to terminate the tenancy and to word the letter of 15 July in the way they had. The defenders had not told the pursuers in response to that letter that they had no intention of ending the tenancy. Arguably the tenancy may also have come to an end by virtue of section 12(1)(e) of the 2001 Act, namely by written agreement .

36

In response, Mrs Corsar's first submission was that that the defenders had not terminated the tenancy. The letter of 14 July 2009 did not bear that construction. It had merely intimated an intention not to return to the subjects, and asked if the pursuer could help the qualifying occupiers. The context in which it had to be construed was that of Ms Burn having gone to the pursuer's housing office on 8 July 2009 and having asked whether the tenancy could be assigned. The letter of 15 July 2009 from Mr McLeod had purported to acknowledge notification to end the tenancy as at 12 August 2009 and stated that there would be an end of tenancy visit. I should accept the evidence of Mrs Duffy, Ms Burn and Mr Cockburn that no such visit had taken place. The pursuer's letter of 15 July 2009 stated that keys must be returned and, if returned late, then the tenancy would continue until the day after. The letter no 6/2 of process, dated 22 October 2010, from Ms Rodger of the pursuers to the first defenders asked for return of the End of Tenancy form and referred to "your tenancy". This all indicated that the pursuer did not consider the tenancy to be ended at that time. The form was not returned and no keys were returned in response to the request. There had been no response to the request to assign. There had been no consensus. The pursuer was attempting to impose a situation on the defenders. Section 12(f) of the 2001 Act required four weeks notice to be given by the tenant to the landlord. That did not happen. The letter of 14 July 2009 was not a letter of termination. There was no written agreement to terminate.

37

The pursuer's letter of 15 July 2009 was followed by the defenders' letter of 22 July 2009, which could not be interpreted as anything other than a request for consent to assign the tenancy. That was indicative of an intention not to end the tenancy. As for the refusal of the request contained in the letter of 29 July 2009, the reasons given for refusal, and in particular, the statement "you have already decided to terminate your tenancy before the expiry of the termination of the existing sub-let" made no sense and misrepresented the situation, when there had been no termination.

38

The assignation request met the criteria set down in the 2001 Act, section 32 (1), (2) and (3). The defenders were tenants when the request was made. It was the qualifying occupiers' principal home throughout the preceding six months. Consent must only be refused on reasonable grounds. There were no such grounds. None of the particular reasonable grounds provided for in section 32(3) had any application. The reason for refusal was only as set out in 5/12 which was not a discernible reason and accordingly the refusal was unreasonable. While the qualifying occupiers accepted that the sub-let required the defenders either to return to the property or arrange to terminate the lease after one year, this agreement was superseded by the letter of 14 July 2009. It was made before the expiry of the sub-let and at a time when the defenders were tenants. This was followed by the summary application, which was presented under schedule 5 of the 2001 Act on 14 August 2009. That was before any notices were served by the pursuer in respect of the recovery of possession. Although the summary application was ultimately dismissed, I should accept Mrs Duffy's evidence that this was not done on the defenders' instructions. They did not understand the position.

39

In terms of schedule 5 paragraph 15 of the 2001 Act the court must order the landlord to consent to an application for assignation unless it considered that the refusal was reasonable. There was a prima facie case at the time of lodging the summary application as the only grounds of refusal were contained in the letter of 29 July 2009. While the letter of 25 July 2008 had stated that the sub-let would not have any rights to succeed to the tenancy, it was accepted by Mr MacLeod and Ms Rodgers in their evidence that succession is a different legal concept from assignation. In the whole circumstances, the court should, in the present action, allow the assignation to take place.

40

Turning to the pursuer's principal case, that based on section 16 of the 2001 Act, Mrs Corsar accepted that notices were served under section 14 of the 2001 Act, and that there was a prima facie valid ground of recovery. Notices were served on 15 November 2010 under ground 5, but that was 15 months following the refusal to agree to the assignation and took no account of the assignation request. Before decree could be granted, the court must find it reasonable to make an order. The leading authority on reasonableness Barclay v. Hannah 1947 SLT 235 had held that the court had an almost entirely unfettered discretion when it came to reasonableness. Lord Moncrieff in particular said at page 237 that that "charges the court with a judicial duty to consider the whole circumstances in which the application is made". This case was referred to by Stalker in Evictions in Scotland at page 141. In his view the assertion that it would not be reasonable to grant the order supported by averments constituted a defence to any action for recovery of possession such as the present.

41

The court had a duty to consider the whole circumstances in which the application is made and anything which might dispose the court to grant decree or to decline to grant decree will be relevant. The factors in section 16(3) must be taken into account in assessing reasonableness. The first of these, in terms of section 16(3)(a), was conduct. The only conduct of any relevance was the absence of the defenders from the property. That could carry no negative weighting. They had alternative accommodation at work and they had reasonably requested an assignation which met the statutory requirements. They had intended to return to the property at the time of requesting to sub-let. There was also no negative conduct on the part of the qualifying occupiers. The duration of any conduct was not relevant here. The second factor, the conduct of others (section 16(3)(b)) had no relevance in the present case. section 16(3)(c) dealt with the third factor, namely, the effect which the conduct had had, was having or was likely to have on any person other than the tenant. This would only be the qualifying occupiers and neighbours in this case. This must be considered under this subsection and under the general requirement to consider reasonableness. The evidence of Mr Lynch was that the qualifying occupiers were good neighbours and he liked having them there. They had lived there since 2008. They had paid "rent". They had no other accommodation. They would not be re-housed by East Lothian Council as, although they would be homeless, they had no priority. They were unlikely to be able to obtain a private let in the area that they required as there were few and they would not be able to afford it. Their relatives were unable to assist. They worked locally and contribute to the local community. They also had relatives with care needs nearby. The final factor, contained in section 16(3)(d) did not seem to be relevant. It was probably fair to say, however, that the pursuer had done nothing to assist.

42

The peculiarity of the present case was that Mr Cockburn and Ms Burn were qualifying occupiers (and had already been accepted as such by the court) and had been sisted as such under section 15 of the 2001 Act. There was nothing in the 2001 Act which fettered or restricted the court's discretion regarding reasonableness to tenants and required the court to exclude qualifying occupiers. There was also nothing in the 2001 Act which stipulated what the court could and could not do regarding qualifying occupiers in proceedings. The court's unfettered discretion in relation to the matter of reasonableness should lead to the action's being dismissed. There were no grounds against the qualifying occupiers. If the court refused to grant decree of ejection, the tenancy would continue. That was not unreasonable, when the summary application for the assignation had been raised and there had been no reasonable grounds for refusal. The dismissal of that had been outwith the control of the qualifying occupiers. If the action were dismissed, the defenders could re-raise a summary application, as tenants. The matter of assignation could then be dealt with in that process. The court had power to consider late applications - Rule 2.6(3) of the Act of Sederunt (Summary Applications, Statutory Applications and Appeals etc. Rules) 1999.

43

The only reported case in relation to qualifying occupiers was Glasgow Housing Association Ltd v. McNamara, supra. This case was persuasive but not binding. It could be distinguished for present purposes, as the facts were not on all fours. Sheriff Ross considered the law at paragraph 23 and had pointed out that the nature of a qualifying occupier's right in proceedings for recovery of possession was surrounded by some uncertainty. He held that the qualifying occupier could become a party and had a right to be heard which is independent of the other parties. He could make submissions which have a bearing on s16(2). The qualifying occupiers took no issue with Sheriff Ross's statement that a qualifying occupier had no substantive property right. Their defence rested on reasonableness, in the assessment of which the unreasonable refusal of the request to assign was one factor. In all the circumstances, the action should simply be dismissed.

44

It is important at the outset to keep clearly in focus the limited nature of the qualifying occupiers' right. I respectfully agree with Sheriff Ross's approach in Glasgow Housing Association Ltd v McNamara 2008 Hous. L.R.38, as set out above at paragraph 22, where he stated that a qualifying occupier merely has a right to be heard and not a right which exists independent of that of the tenant. A qualifying occupier can, therefore, submit that decree cannot, or should not, be granted. In doing so, he can advance any defence which could have been advanced by the tenant (such as, for example, that no ground of possession, against the tenant, exists). He is also entitled to argue that it is not reasonable for decree to be granted, and in doing that, he is entitled to found upon his own circumstances as distinct from those of the tenant (since the court is, as will be considered more fully below, obliged to take all circumstances into account in considering reasonableness).

45

However, that is the extent of the qualifying occupier's right. As was identified by Adrian Stalker in his book Evictions in Scotland at pages 187 -189, the right may therefore be of limited utility in the absence of some other express right to acquire the tenancy. Although Mrs Corsar submitted that I should order the pursuer to consent to an assignation of the tenancy by the defenders to the qualifying occupiers, she was unable to point to any authority which showed that such a course would be competent in the present proceedings. I do not consider that such an order, in this action, would be competent. Although Mrs Corsar invited me to hold that the summary application was dismissed other than on the instructions of the defenders, and treat this action as if it were the summary application, I am not prepared to do so, for two reasons. First, there is insufficient factual basis for doing so, given that Mrs Duffy conceded that she might have given such an instruction without fully understanding it. Further, we have not had the benefit of Shelter's input on the point. Second, the fact is that the action was dismissed, and it is simply not possible to undo that in the present proceedings. It would therefore be incompetent for me to treat this action as if it subsumed the now-defunct summary application so as to make the order that the qualifying occupiers would like me to make, that they acquire the tenancy. It follows from this that the best outcome the qualifying occupiers can hope for in this action is that it be dismissed, in the hope that the tenancy might in the future be assigned to them. Indeed, I accept, in principle, the argument that if a court were to find that a refusal to consent to assign was unreasonable and that a future summary application might be successful, then it may well be that it would be unreasonable to grant decree for recovery of possession, at least in some circumstances, and particularly if the rent were up-to-date (as here). Accordingly, although this action is not itself an appeal against the refusal of consent, it is relevant to consider whether it is unreasonable to refuse consent.

46

Having raised the issue of the assignation, this is therefore a convenient place to deal with that issue. Since I accept that the reasonableness of the refusal is a relevant factor in considering reasonableness, it is necessary to have regard to the statutory provisions for assignation of a tenancy. Section 32(1) of the 2001 Act provides that it is a term of every Scottish secure tenancy that the tenant may assign (a) only with the consent of the landlord and (b) only where the house has been the assignee's only or principal home throughout the period of 6 months ending with the date of the application for consent. It is accepted in the present case that the latter condition is satisfied viz a viz the qualifying occupiers. Section 32(2) provides that the landlord may refuse consent only where he has reasonable grounds for doing so. Subsection (3) states that there are, in particular, reasonable grounds in certain specified circumstances. Since it is not contended by the pursuer that any of those grounds exist here, it is unnecessary to list what they are. However, the reference to "particular" reasonable grounds makes it clear that the list in subsection (3) is not intended to be exhaustive, and so any fact or circumstances could potentially render a refusal reasonable. Mrs Corsar's submission that none of the particular grounds exists is therefore nothing to the point, and the terms of the pursuer's consent to the sub-let must in my view be a relevant consideration in considering reasonableness in the present case. Further provisions regarding the assignation of a Scottish secure tenancy are contained in part 2 of schedule 5 of the Act. Paragraph 9 of that part requires the tenant to make a written application containing certain details, which it is accepted were provided here by the letter of 22 July 2009. Paragraph 11 provides that the landlord may (a) consent or (b) refuse consent, provided that consent is not refused unreasonably. By virtue of paragraph 12, the landlord must intimate its consent or refusal, and in the case of refusal, the reasons for the refusal, within one month of receipt of the application, otherwise (paragraph 13) it is to be taken to have consented. It is not contended in the present case that the pursuer failed to intimate its decision within one month. Although issue is taken with the wording of the letter of refusal, that was in the context of the reasonableness of the decision, and Mrs Corsar did not seek to argue that the letter of refusal was so unintelligible that paragraph 13 had been triggered. Paragraph 14 then confers a right to raise a summary application on a tenant who is aggrieved by a refusal. Paragraph 15 states that in such proceedings the court must, unless it considers that the refusal is reasonable, order the landlord to consent to the application.

47

Although I was not referred to any case dealing with the meaning and effect of paragraphs 14 and 15, nor indeed to any academic discussion thereof, my reading of those provisions is that the aggrieved tenant is given not so much a right of appeal as a right to have the question of reasonableness considered de novo by the court. The question for the court is not whether no reasonable landlord would have refused to grant consent, but whether the court itself considers that the refusal is reasonable. Thus the focus is not so much (as it would be in an appeal) on the decision itself as on the underlying circumstances. I stress this point because it seems to me that this detracts from the force of the qualifying occupiers' argument that the letter of 29 July 2009 intimating the refusal made no sense. I agree that it was poorly worded, but I consider that it can only bear the construction that the pursuer was refusing consent having regard to the terms of the sub-let. Those terms were that either the defenders would return to the tenancy after one year or they would terminate the lease.

48

The pursuer's decision might have been criticised on a number of grounds, not least that they appeared to have had regard only to one factor, namely the terms of the sub-let, and ignored other factors which might have been relevant, such as why the defenders had decided not to return, and the personal circumstances of the qualifying occupiers themselves. However, these criticisms would have been academic, since had the summary application which was presented run its full course, the sole question for the court in that case would have been whether it was reasonable to refuse consent. (As an aside, paragraph 15 by its use of the phrase "is reasonable" would tend to suggest that the court must consider reasonableness as at the date of hearing of the summary application, rather than the date of the landlord's original consideration, but I was not addressed on this point). In considering that question, the court would not be restricted to consideration of the sole ground relied upon by the pursuer, but would have been entitled, indeed bound, to have regard to all relevant factors. As I have said, this somewhat detracts from the criticisms of the pursuer's decision, since the court would be considering the matter de novo in any event, and in doing so would take into account the considerations left out of account by the pursuer.

49

So, turning to consider the reasonableness or otherwise of the refusal to consent, it seems to me that it was, and is, reasonable to refuse consent. The qualifying occupiers went into the sub-let with their eyes open, and were aware that their occupation would last for at most one year, after which time either the defenders would move back or the tenancy would be terminated. They were aware that they would have no entitlement to succeed to the tenancy, and while there is a difference between succession and assignation, the terms of the agreement to consent to sub-let were such as to rule out the possibility of assignation in the event of the tenants deciding not to return, as turned out to be the case. Further, the defenders had agreed expressly that if they did not return to the subjects, they would terminate the tenancy. In refusing to consent to an assignation, the pursuer was doing no more than adhering to the terms of its agreement to a sub-let, which I think is what Mr MacLeod was trying to express in his letter of refusal. Additionally, there was and is nothing about the qualifying occupiers' personal circumstances which would render the pursuer's refusal unreasonable. They are both young, healthy and in employment. They are admittedly popular with the local community but that is not in my view a relevant consideration, at least not when set beside the pursuer's allocations policy. It is undoubtedly the case that the occupiers are not entitled to be allocated the house under that policy and while that is not the only consideration, it is a relevant factor, particularly when, as is the case, the pursuer has insufficient housing stock to meet demand. It is entitled to take reasonable steps to recover properties which have been vacated by a tenant in order that these properties might be allocated in accordance with its policy, to those most in need. In all these circumstances, the refusal to consent to an assignation cannot be held to be unreasonable. I therefore approach the remaining issues in the case on the footing that the qualifying occupiers not only have no entitlement to remain in the property but that there is no likelihood of their ever acquiring such entitlement by assignation.

50

Logically, the next question to consider is whether the tenancy was terminated by the tenants in July 2009, since if it was, as Mrs Corsar accepted, that would result in the pursuer being entitled to decree irrespective of any considerations of reasonableness. Whether the tenancy was terminated by the written notice turns on the wording of the letter of 14 July, no 5/9 of process, rather than on what was in Mrs Duffy's mind when she wrote the letter. Likewise, the pursuer's response must be construed according to its terms, rather than by reference to what Mr MacLeod thought he meant or to the pursuer's actions in closing the rent account.

51

The lease provides that it shall be terminated upon either party giving to the other 28 days notice in writing of termination. By contrast, the letter of 14 July 2009 intimated that the defenders would not be returning to the subjects on 4 August 2009. On the face of it, that was ineffective as a notice of termination as it did not give 28 days' notice in writing prior to 4 August. What the letter did not purport to do was to give notice of termination at 12 August 2009. The pursuer's argument is that because the defender was bound either to return to the subjects or to terminate and were not returning, then they must have been terminating, but I do not think that follows, since it assumes that parties always do what they are contractually bound to do, and takes no account of the possibility which the defenders in fact wished to explore that the lease might be assigned. Further, I accept Mrs Corsar's submission that the context against which the letter must be construed included Ms Burn having inquired about the tenancy being taken over.

52

Accordingly, Mr MacLeod's response was inapt, when he began his letter no 5/10 of process by stating "I acknowledge your notification to end the above tenancy as of 12 August 2009." The letter had given no such notification, and as recorded above, the purported acknowledgement was a somewhat disingenuous distortion of what had been said. Doubtless in many cases - indeed, in most cases, where the tenants are keen for their obligations as tenants to end as soon as possible - tenants will be only too happy to agree to the tenancy terminating four weeks after the date of their notice, but it is important to appreciate that that is done as a matter of bilateral agreement rather than because the landlord has the unilateral right to impose its will on the tenant where an inaptly worded notice has been given. Whether that is a correct statement of principle or not is in any event academic in this case, since the letter 5/10 of process went on to state that the tenancy would not terminate until the keys were handed in. It was a matter of agreement that no keys were handed in at any stage thereafter. Contracts are made by what people say, rather than what they think, and so the defenders were entitled to take that letter at face value and proceed on the basis that the pursuer had stated that the tenancy would not terminate until the keys were handed in. It was therefore unnecessary for them to expressly respond to the letter to rebut the statement that the tenancy would terminate on 12 August 2009. That said, the defenders did respond to the letter of 15 July by formally requesting consent to assign, which was inconsistent with their wishing the tenancy to come to an end, because as Mr Wilson acknowledged, the tenancy could not be assigned after it had terminated. As I have already indicated, it was nothing to the point that the pursuer took an internal decision to close the rental account. However, since the pursuer founds on its having done so, I would point out simply that it has taken other action indicative of the fact that the tenancy still exists (such as writing its letter of 22 October 2010 (no 5/2/1 of process) (rather pointlessly addressed to the defenders at the subjects) in which they requested return of the end of tenancy form. Moreover, the very basis on which this action was principally conducted was that the tenancy had not been terminated. In all these circumstances, I have reached the view that the tenancy was not terminated by the letter of 14 July and so remains in existence.

53

Given that I have found that the pursuer's response did not accurately refer to the terms of the defenders' letter, the argument that there was written agreement to terminate the tenancy is virtually unstateable, and was presented in a somewhat half-hearted manner. It is clear from the foregoing analysis that there was no such agreement. I reject that argument also.

54

It is not disputed that the ground specified in ground 5 of schedule 2 exists, namely that the tenants have ceased to occupy the subjects as their principal home. For that matter, they have now been absent from the subjects without reasonable cause for considerably longer than a continuous period of 6 months. Accordingly, by virtue of section 16(2) of the 2001 Act, I must make the order sought if it is reasonable to do so.

55

Since the existence of the ground is not disputed, the real point of controversy between the parties is the issue of reasonableness. Before considering the particular factors which bear upon that issue in this case, it is appropriate to comment on the nature of the test to be applied. I do not consider that the court should approach the issue of reasonableness by asking whether eviction is the most reasonable course or one of several equally reasonable but conflicting courses. A particular course of action can either be reasonable or unreasonable but it cannot be both. A reasonable course of action does not cease to be reasonable simply because there are other actions which might be equally, or more, reasonable. The court is not concerned here with whether a decision already reached falls within a range of reasonableness. Rather, the court must form its own view as to whether it is reasonable to make the order sought. If the answer to what question is yes, then the order must be granted. If it would not be reasonable to make the order, it must be refused.

56

In reaching a view on reasonableness, the court must have regard to all the circumstances of the case: Barclay v Hannah 1947 SC 245. However, the court is also enjoined, by section 16(3) of the 2001 Act to have regard in particular to four specific factors, namely:

"(a)

the nature, frequency and duration of -

(i) where the ground for recovery of possession is that set out in any of the paragraphs 1 and 3 to 7 of Schedule 2, the conduct taken into account by the court in concluding that the ground is established...

(b)

the extent to which that conduct is or was conduct of, or a consequence of acts or omissions of, persons other than the tenant.

(c)

the effect which that conduct has had, is having and is likely to have on any person other than the tenant, and

(d)

any action taken by the landlord before raising the proceedings, with a view to securing the cessation of that conduct."

57

Parties devoted considerable time and effort to trying to fit the facts of this case into those four factors. While this is a conduct case, in that the tenants have chosen to stop living in the subjects, the nature of that conduct is such that the factors set out in (b) to (d) of section 16(3) have no meaningful application here. I do not think that the court must always strain to apply all the factors, where it is clear that they have no application. However, now dealing with those particular factors insofar as they are applicable, I do not consider that any of them can result in any criticism being levelled at the defenders. They chose to leave the subjects because of the first defender's employment. They left initially with the consent of the pursuer, who also consented to the installation of the qualifying occupiers as sub-tenants. Likewise, the defenders' decision not to return was reached for entirely understandable reasons. Since the qualifying occupiers have at all times resided in the subjects, there is no question of the subjects having been left unoccupied or unattended. It is simply a fact that the defenders have, for perfectly understandable reasons, ceased to occupy the subjects as their home. The second factor has no real application. This is not a situation where another person is said to have acted in such a way as to cause the defenders to be in breach of their tenancy. Likewise, the third factor has no real application, in that this is not a situation where any third party has been affected by the defender's conduct. Finally, since the "conduct" consisted of a discrete decision to move into other accommodation, it is inappropriate to consider whether the pursuers have sought cessation of the conduct.

58

So, the four particular factors set out in section 16(3) tell us very little about the reasonableness, or otherwise, of making the order sought. Neither the conduct of the pursuer, nor that of the defender, can be described as unreasonable. In determining reasonableness, it is necessary to have regard to the whole circumstances, not merely the statutory factors. Moreover, since those four factors have little application, it is likely that other factors will, in this particular case, carry more weight.

59

Mr Wilson also strained to fit the facts of the case into what he described as the Lockhart criteria, as though they were factors to which regard must be had in every case. However, I think that is to accord to those factors a status which they do not have. There is no statutory basis for them. Rather, they were four factors to which regard was had in the circumstances of a particular case, the facts of which bear no similarity to those in the present case. I therefore do not propose to conduct a similar exercise of trying to fit the facts of this case into those criteria. Rather, I will consider the additional factors which I do consider to be relevant in this case.

60

The first additional factor to which I have regard is that there is no person residing in the house who has any title to be there, and (given the view which I have reached on the reasonableness of the refusal to consent to an assignation) there is no foreseeable prospect of that changing. The defenders, who are entitled to reside there, have left and have no intention of returning. The qualifying occupiers, who do reside there, have no entitlement to do so and were decree to be refused, they would continue to reside in the property indefinitely on a precarious legal basis. There would be no obligation on them to pay rent, although I do accept that they have faithfully and honourably tendered the rent throughout the period of their occupation and would continue to do so if they were allowed to remain. Although the pursuer has steadfastly refused to accept these payments for fear of creating a tenancy with the qualifying occupiers, I consider that to be unduly cautious (since rent could have been accepted on the express basis that the tenancy with the defenders subsisted, which would have been consistent with the position stated in correspondence), and I therefore do not accept either that there would be any future financial loss to the pursuer, or, for that matter, that the pursuer has suffered any financial loss to date given that a sum of money equivalent to the rent has been tendered and is currently in a suspense account.

61

Nonetheless, reasonableness is not to be judged solely on the basis of financial loss. It would, I think, be unsatisfactory if the pursuer was unable to recover possession of a house which was occupied by persons whom they did not wish to accept as tenants, and prima facie it would be unreasonable of the court to compel them to abide by that position, when it has obligations as social landlords to allocate housing in accordance with need. Put another way, it is for the pursuer, not the court, to decide who should be allocated a house and who should not. In fact, the potential unreasonableness goes beyond that, since a refusal of decree would result in the tenancy with the defenders continuing, and that would not be a reasonable position to enforce on them. Taking the defenders' position at face value, it is not that they wish to remain obligants under the tenancy indefinitely, but that they wish the tenancy to be preserved meantime in order that they might assign it to the qualifying occupiers. It would be unreasonable to expect them to remain liable for all the obligations of a tenant (including payment of rent) for the foreseeable future when they have no intention of returning to the subjects. For that matter, it would be unreasonable of them to expect that the tenancy of the subjects continue indefinitely in those circumstances. So, in a question solely between the pursuer and the defenders, it is not unreasonable that the order sought be granted.

62

However, I accept as correct Mrs Corsar's submission that the circumstances of the qualifying occupiers must also be taken into account in assessing reasonableness. I accept that if they had any realistic prospect of acquiring the tenancy by assignation, then it may be unreasonable for an order to be made, particularly as the pursuer is not (or at least, need not) suffer any financial prejudice. However, for the reasons already given, I consider that the refusal to assign is reasonable, and consequently there is no realistic prospect of the tenancy being assigned.

63

For completeness, I should say that the argument over the pursuer's allocations policy is perhaps slightly circular, inasmuch as it only comes into play if the house is recovered and falls to be allocated. If it is not reasonable to recover possession, then there will be no need for the house to be allocated. However, it is clearly relevant as an indirect factor to take the policy into account, for at least two purposes. First, it is relevant to reasonableness that if the qualifying occupiers were allowed to continue residing in the subjects indefinitely, that would amount to an indirect subversion of the policy, since they would (in effect) be jumping the queue for allocation of a house. In fact, it goes beyond merely a timing issue, since they candidly accept that the terms of the policy are such that they will never be entitled to be allocated any of the pursuer's houses in East Lothian, let alone this one. Again, that tends to suggest that it would be unreasonable for them to remain in the subjects indefinitely. However, second, and paradoxically, that very same factor also falls to be considered as a factor which favours the qualifying occupiers, since it is undoubtedly the case that if they are evicted, they will be unable to obtain comparative accommodation at the rent which is currently charged for the subjects.

64

Indeed, that leads on to the most compelling argument that the qualifying occupiers have for being allowed to remain in the subjects. They would find it difficult to obtain alternative accommodation. They are unlikely to be able to afford accommodation suitable for their needs in North Berwick. I do not consider that they have acted unreasonably in restricting their application to specific areas and specific types of house, since they are unlikely to be offered any accommodation by the pursuer whatever they ask to be considered for. However, they have not demonstrated that they will be unable to afford any suitable housing elsewhere in East Lothian. If the geographical area which they are prepared to consider is widened, and if they apply for housing benefit, they ought in time to be able to find a house within their means. Further, the fact of the matter is that both do have relatives in the area with spare rooms which could be used as an alternative measure. Thus I proceed on the basis that the qualifying occupiers will in time be able to find a house, albeit one which is not in North Berwick and which will be more expensive. That is unfortunate for them, since they have clearly settled in to the subjects and are a valuable (and valued) part of the local community, but those factors are outweighed by the other factors which point towards the order sought being reasonable. Both qualifying occupiers are young, healthy and in employment. They do not have children. Perhaps ironically, the same factors which result in their being allocated few points under the pursuer's allocations policy also point towards it being reasonable to make the order sought in the present case.

65

The next relevant factor which must be considered is delay, since there was delay in the pursuer raising proceedings. It is not impossible to imagine such a delay that it might then become unreasonable to evict sub-tenants who had established roots in the local community. However, I do not consider the delay here to be of that nature or magnitude. Given that the defence to the action was originally said to be that it was unreasonable to grant decree while the summary application was pending, the pursuer could not be criticised for not taking action while it was pending, and cannot be held accountable for the delay in that application being progressed.

66

Drawing all of the foregoing together, and to summarise, against a background where the pursuer has insufficient housing stock to meet demand, it is reasonable for it to recover possession of the subjects in order that they might be allocated to a person with greater need than that of the qualifying occupiers, in circumstances where the latter have no right or title to be in the subjects and where they had agreed from the outset to vacate the subjects after one year, whether the defenders returned or not. Although the qualifying occupiers will suffer a degree of hardship, in that they will have to pay more rent for a property which is less convenient for them, the hardship is not of such a degree as to make it unreasonable to order them to vacate the subjects. They are, in reality, in no worse a position than that in which they would have found themselves had they moved out of the subjects in 2009 as they had originally agreed. Their position in evidence ultimately came down to an attack on the pursuer's allocations policy but it must be stated that the policy is, for the reasons submitted by Mr Wilson, in accordance with the legal obligations placed on the pursuer. It is in any event not the function of this court to tell the pursuer what its allocations policy should be.

67

Since the ground relied upon by the pursuer for recovery of possession of the subjects exists, and since it is reasonable to make that order, I have decided to grant decree against both the defenders and the qualifying occupiers.

68

Since the question of expenses remains unresolved, I have continued the cause for a hearing in relation to that issue, which will require to be dealt with before decree can be granted.

69

This decision should in no way be taken as reflecting badly on the qualifying occupiers. I accept that they are model "tenants" and neighbours and that the requirement for them to move will come as a blow to them, and to their neighbours. They are in reality a victim of pursuer's having insufficient housing stock to meet demand, and I can fully understand their frustration at their inability, and to all intents and purposes, ineligibility, to be awarded a house. That is not a criticism of the pursuer, simply a statement of fact. I hope that the pursuer will handle their necessary removal from the subjects in a sympathetic manner.