[2024] UKUT 40 (LC)

In August 2022 the respondents applied to the FTT for rent repayment orders. The amounts claimed by each of the respondents ranged from just over £6,500 to almost £9,200 and represented the full amount they had each paid during the 12 month period in respect of which an order could be made. In support of their applications they provided details of problems they had encountered in occupying the flats during the Covid 19 pandemic period when restrictions were in force. They also identified a number of appliances which needed to be replaced and made other complaints about the management of the building.

In its statement of case for the FTT the appellant asserted that it ought to have been consulted before the additional licensing scheme was introduced. Had it been consulted it would also have been notified when the scheme was made. As it was, it did not become aware of the scheme until in or around July 2022. It asserted that it had a reasonable excuse for managing the property without a licence although it did not, in terms, say what that excuse was. Reading between the lines, it blamed Haringey for the fact that it was unaware of the additional licensing scheme and the need to apply for a licence.

The FTT was unimpressed by this defence. In its decision handed down on 11 May 2023 it pointed out that the appellant could have challenged any failure by Haringey to consult by an application for judicial review, but it had not done so. The FTT rejected what it described as “the central tenor” of the appellant’s argument, namely, that as a provider of student housing which is exempt from mandatory licensing it was entitled to “special consultation treatment” which excused it from making its own investigations into the existence and effect of the designation on its property.

The FTT noted the evidence that, before the designation took effect, it was advertised in local newspapers, through a landlord’s forum, and by circulation to landlord “governing bodies” and to Haringey’s landlord and agent mailing list. The FTT was satisfied that the designation was widely advertised, and that Haringey had complied with its obligations under the 2006 Regulations. It concluded:

“The respondents cannot excuse their failure to licence on the basis that the local authority did not go one step further and contact them directly. The reasonable excuse defence is rejected.”

As the reasonable excuse defence was the appellant’s only answer to the application for rent repayment orders, the FTT was satisfied that the offence had been established and proceeded to address the factors relevant to its assessment of the amount of rent to be repaid. It directed itself by reference to recent decisions of this Tribunal, in particular Williams v Parmar [2021] UKUT 244 (LC), Hallett v Parker [2022] UKUT 165 (LC) and Acheampong v Roman [2022] UKUT 239 (LC). It found the allegations of misconduct relied on by the applicants were “unimpressive” and had been “formulated to try to boost the penalty rather than based on genuine complaint” and made no adjustment on account of them. Relying on information about the cost of utilities supplied to the whole building, it then adjusted the rent claimed by each tenant downwards by £40 per month to reflect the fact that those costs had been met by the appellant on the tenants’ behalf. It then had regard to the seriousness of the offence and concluded that repayment of 50% of the total rent (net of the allowance for utilities) was appropriate. The amounts awarded varied from £3,042 to £4,370 and totalled just over £23,000.