HT-2019-CDF-000012 - [2025] EWHC 1315 (TCC)

This head of claim relates to the risk that sub-tenants, who rented the flats from the Wilsons, may claim restitution of the rent they paid on the grounds that the flats were unfit for human habitation. The head of claim is said to rest on the decision of the Divisional Court in Coastal Housing Group Ltd v Mitchell [2024] EWHC 2831 (Ch), [2025] 1 WLR 1517. That case considered issues arising under the Renting Homes (Wales) Act 2016, which came into force on 1 December 2022. In particular, the court held that occupiers under housing contracts under the Act who had not been given electrical condition reports, as mandated by the legislation, had not been required to pay rent. (There is a pending appeal against that decision.) The case turned on the interpretation and application of two sets of regulations made under the Renting Homes (Wales) Act 2016, namely the Renting Homes (Supplementary Provisions) (Wales) Regulations 2022 and the Renting Homes (Fitness for Human Habitation) (Wales) Regulations 2022, which came into force simultaneously with the Act.

Mr Singer observed that, even if there were some underlying merit in this head of claim, no possible claim for an indemnity is shown. At best, Mr and Mrs Wilson could have a claim for damages in respect of the risk of suffering loss by reason of restitutionary claims made against them by former tenants. This is correct, though by itself it would not be fatal to the claim, because the court could permit the claimed relief to be recast as damages. However, I consider that the head of claim should be struck out. The fact that the claim is not pleaded in the POC means that no facts have been advanced to show that the risk of claims by previous tenants is a real possibility. The legal basis of the claim is also unclear. Mere reference to the Coastal Housing Group case will not suffice, because none of the defendants in that case had actually withheld rent, and the court was not asked to decide whether occupiers who had paid rent they were not required to pay might have a valid counterclaim for repayment of rent. If the Wilsons wish to advance a claim for damages representing the value of the risk of liability to third parties in respect of repayment of rent, they should formulate the claim properly and quantify it and apply for permission to amend.