I can confirm the sddm start issue after upgrade from Ubuntu 14.04 to Ubuntu 16.04. From /etc/syslog:
chdir( /var/lib/sddm ) failed for user: "sddm"
/var/lib/sddm was not existing in my case. So, I created it and adapted its permissions:
sudo mkdir /var/lib/sddm
sudo chown -R sddm:sddm /var/lib/sddm
After that, I "service sddm restart" made sddm work again.
I can confirm the sddm start issue after upgrade from Ubuntu 14.04 to Ubuntu 16.04. From /etc/syslog:
chdir( /var/lib/sddm ) failed for user: "sddm"
/var/lib/sddm was not existing in my case. So, I created it and adapted its permissions:
sudo mkdir /var/lib/sddm
sudo chown -R sddm:sddm /var/lib/sddm
After that, I "service sddm restart" made sddm work again.