Middlesbrough Council has won a landmark legal victory in the High Court after a judge dismissed an appeal by a charity accused of exploiting the Housing Benefit system. The ruling, handed down by Upper Tribunal Judge Edward Jacobs on 20 April 2026, supports the council’s decision to refuse benefit payments for housing schemes that were found to be unsuitable for vulnerable residents.
The case centred on two housing schemes in North Ormesby set up by the charity My Space Housing Solutions in 2017. Middlesbrough Council rejected the projects at the time, noting they were not appropriate for disabled or vulnerable people. When officials later visited the properties, they discovered that a single member of staff was expected to support 38 tenants, a level of care deemed insufficient.
Judge Jacobs confirmed that the charity had created tenancy agreements specifically to take advantage of the Housing Benefit system, meaning no payments were legally due. This decision has saved the public purse more than £1 million. Councillor Nicky Walker, the council’s executive member for finance, said the authority acted to protect taxpayers and ensure that vulnerable people receive support from organisations acting in their best interests.
The charity has faced significant scrutiny in recent years. In January 2023, the Regulator of Social Housing issued an enforcement notice citing unacceptable governance failures, and the Charity Commission launched a statutory inquiry in 2022 into potential conflicts of interest and the management of funds.
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