[2025] UKUT 97 (LC)

The current appeal is not against the FTT’s substantive decision to quash the improvement notice, nor did Lambeth question the FTT’s approach to Manaquel’s appeal against the notice in a cross-appeal of its own. The issue is whether the FTT erred in refusing to make a costs order against Lambeth. But it is impossible to determine whether the FTT was impermissibly lenient in its reaction to Lambeth’s conduct without first considering whether the criticisms it made were based on a mistaken appreciation of the real issues in the appeal. Before deciding, for example, whether it was unreasonable for a party to fail to prepare evidence it is relevant to consider whether that evidence would have been relevant to an issue which properly arose for determination. It was for that reason that I asked the parties to consider the relevance of the Court of Appeal’s decision in Waltham Forest v Hussain.

As I have explained, Waltham Forest v Hussain concerned a licencing decision under Part 3 of the 2004 Act. The local authority decided that Ms Hussain’s mother was not a fit and proper person to hold a licence, having been convicted of making false statements in previous licence applications, and that in view of her close association with her mother and her involvement in the family letting business Ms Hussain herself could not be regarded as fit and proper either. The FTT allowed Ms Hussain’s appeal, taking into account progress she had made with her accountancy studies and the fact that the property company of which she was a director, and which had not begun to do business at the time of the authority’s decision, was by the time of the appeal hearing a trading company with appropriate affiliations, a second director and an income stream to support its responsibilities as a licence holder. Those matters, which did not exist at the date of the local authority’s decision, gave rise to the dispute over the proper question to be asked on an appeal against a licence decision.

The Court of Appeal disagreed with the FTT and with the Tribunal on the proper approach. The task of the FTT was “to determine whether the decision under appeal was wrong at the time when it was taken”. Andrews LJ explained, at [64], that "wrong” in this context means that the FTT disagrees with the original decision despite having accorded it the deference appropriate to a decision involving the exercise of judgment by the body tasked by Parliament with the primary responsibility for making licensing decisions. It does not mean "wrong in law". Put simply, the FTT must consider whether the authority should have decided the application differently. Generally speaking:

“… an event which occurs after a decision is taken will not be relevant to the assessment of whether that decision was right or wrong at that time. There is an obvious illogicality in the proposition that the Council were wrong to conclude that Farina was not a fit and proper person in November 2018 because she has subsequently achieved, or made significant progress towards achieving, certain relevant professional qualifications, and demonstrated to the satisfaction of the FTT that she has been doing a good job of managing the Westbury Road property in the intervening period.”

Did paragraph 15(2) of Schedule 1 to the 2004 Act, which states that an appeal to the FTT against an improvement notice is to be by way of a re-hearing but may be determined having regard to matters of which the authority was unaware, require the adoption of the Hussain approach in this case? Or, when it decided Manaquel’s appeal, was the FTT entitled to take account of the condition of the Estate at the date of the appeal and the works which had been undertaken since the service of the improvement notice?

The 2004 Act repeatedly directs tribunals that appeals against the decisions of local housing authorities are to be by way of a re-hearing but may be determined having regard to matters of which the authority were unaware. The Court of Appeal reversed the Tribunal’s decision in Hussain, but it did not comment adversely on the President’s acceptance, at [50], “that Parliament must have intended that essentially the same approach to an appeal would be taken by the appropriate tribunal in all such cases under the 2004 Act.”

In Curd v Liverpool City Council [2024] UKUT 218 (LC), I referred to the Court of Appeal’s decision in Hussain and, without having heard argument to the contrary, I indicated at [14] that the same approach applied to appeals against improvement notices i.e. “the FTT was required to consider whether the decision under appeal was wrong at the time when the decision was taken (and not at the date of the appeal).”

Manaquel’s case on this aspect of the appeal was presented by Mr Miller. He acknowledged that there is a presumption that where the same words are used in different places in an Act of Parliament they are intended to have the same meanings, but that presumption is rebuttable. He submitted that differences between the new system for assessing the condition of residential premises introduced by Part 1 of the 2004 Act (the Housing Health and Safety Rating System, or HHSRS) and the selective licensing regime in Part 3 of the Act strongly suggest that the approach to appeals in Hussain should not apply to the former. Instead, in an improvement notice appeal, the statutory context requires an assessment of the notice and the works specified in it as at the date of the appeal hearing. He also identified what he suggested were anomalies if the FTT was required to consider the validity of an improvement notice by reference only to circumstances as they were at the date the notice was given and not at the hearing of the appeal.

The relevant differences and suggested anomalies which Mr Miller identified were the following:

I do not think any of these points justifies attributing a different meaning to the directions given to the FTT in paragraph 15(2) of Schedule 1 to the 2004 Act from that applied by the Court of Appeal in Hussain to the same language where it appears in paragraph 34(2) of Schedule 5. None of them provides any reason why Parliament should have contemplated a different form of re-hearing where the decision under appeal relates to the service of an enforcement notice rather than a licence. None of them justifies treating the issue on an appeal as an ever-moving target, as Lewison LJ put it in Hussain. The question in both types of appeals is whether the local authority’s decision was wrong. Events which occurred after the decision was made cannot be relevant to whether it was right or wrong.

The first of Mr Miller’s points does not seem to me to identify a relevant difference. But in any event, it is not a comprehensive statement of the courses of action open to a person who receives an enforcement notice. If there are matters in the notice with which the recipient disagrees, they may of course appeal, but they may also apply to the local authority to vary or revoke the notice (section 16(8), 2004 Act). A separate right of appeal is available against an authority’s refusal to vary an improvement notice (under paragraph 13 of Schedule 1, 2004 Act).

There would have been no obstacle in this case to Manaquel asking Lambeth to vary the notice to take account of work done after it was served in October 2021, or to have regard to evidence of how the heating system had performed during the next winter, or evidence that none of the potential deaths or serious injuries on which the hazard scores was predicated had occurred. On a proper analysis of the whole scheme, the anomalies and structural problems which Mr Miller relied on are illusory.

Sections 5 and 7, 2004 Act confer duties and powers in respect of enforcement action on the local housing authority, and Parliament intended that it should be the primary decision maker on the seriousness of hazards and the most appropriate way to address them. It is entirely consistent with that intention that any changes to enforcement action justified by evidence of recent events, or changes in the characteristics of the occupiers, or technological innovations should be considered first by the authority on an application to vary made under section 16(8). In my judgment the true anomaly would be for the FTT to have the first and final say on the effect of such changes.

Mr Miller suggested that there might be multiple appeals if the recipient of a notice was expected to request a variation from the local authority, and then appeal again if they were not satisfied with the response. Or if the recipient was content with some variations but not with others, an extant appeal against the notice would proceed on a confused basis. These do not seem likely to be serious objections in practice, but in any event, they are not a reason to upend the structure of Part 1 and substitute the FTT for the authority as the primary decision maker. That would be the effect of asking the FTT to consider whether an improvement notice should be upheld, varied, or quashed, based on circumstances existing at the date of the appeal rather than asking whether the authority’s decision to serve the notice was wrong at the date the notice was served.

For these reasons I am satisfied that significant parts of Manaquel’s case were presented to the FTT on a legally incorrect basis. The question for the FTT should have been whether Lambeth was wrong to serve the notice it did, when it did; works done since the service of the notice could not undermine the validity of Lambeth’s decision, nor was there any requirement for Lambeth’s officers to justify or reformulate the notice in the light of those works.

It is against that background that I now come to the appellant’s grounds of appeal.