[2025] UKUT 196 (LC)

Part 2 of the Housing Act 2004 (the Act) introduced a new statutory scheme for licensing houses in multiple occupation (HMOs). Statutory control of HMOs was introduced in the Housing Act 1957 which gave local housing authorities powers of oversight which were subsequently extended and eventually consolidated in Part XI of the Housing Act 1985. That scheme was entirely replaced by Part 2 of the Act which makes provision for HMO licensing. Part 2 is supplemented by provisions in Part 7 of the Act which confer powers on the Secretary of State to approve codes of practice and to make regulations concerning the management of HMOs. Under the Act, licensing and regulation are complementary responses to poor housing conditions.

By section 55(2)(a) of the Act, Part 2 applies to any HMO in a local housing authority’s district which falls within a prescribed description. In England, an HMO which meets the “standard test” in section 254(2) of the Act is within a prescribed description if it is occupied by five or more persons living in two or more separate households (article 4, Licensing of Houses in Multiple Occupation (Prescribed Description) (England) Order 2018).

The property in this case was an HMO because it met the “standard test” in section 254(2). In summary, it comprised a number of individual rooms which were not self-contained flats and whose only use was as living accommodation, which were occupied by individuals who did not form a single household, each occupying an individual room as their only or main residence, paying rent and sharing basic amenities.

Dealing first with licensing, section 55(5) imposes general duties on every local housing authority in relation to licensing. These include, by section 55(5)(c) and (6) a duty on the authority to satisfy themselves, by inspection or otherwise, that the condition of premises in respect of which a licence has been applied for is not such as to give rise to a hazard engaging the authority’s duties and powers under Part 1 of the Act, which is concerned with the enforcement of housing standards.

By section 61(1) of the Act, and subject to certain exemptions that do not apply in this case, any HMO to which Part 2 applies is required to be licensed. Unless it is exempt, every HMO which meets the standard test and which is occupied by more than five persons living in two or more separate households is therefore required to be licensed.

Section 64 of the Act makes provision for the grant or refusal of HMO licences by local housing authorities. By section 64(3), the matters of which an authority must be satisfied before they may grant a licence include:

“(3)

…

(b)

that the proposed licence holder-

(i)

is a fit and proper person to be the licence holder, and

(ii)

is, out of all the persons reasonably available to be the licence holder in respect of the house, the most appropriate person to be the licence holder;

(c)

that the proposed manager of the house is either-

(i)

the person having control of the house, or

(ii)

a person who is an agent or employee of the person having control of the house;

(d)

that the proposed manager of the house is a fit and proper person to be the manager of the house; and

(e)

that the proposed management arrangements for the house are otherwise satisfactory.”

The object of licensing is indicated by the general duties in section 55(5) and by the considerations relevant to the grant of licences in section 64(3) all of which relate to the condition and standard of management of the premises.

By section 72(1) of the Act a person commits an offence if they are “a person having control of or managing an HMO which is required to be licensed under this Part (see section 61(1)) but is not so licensed.”

Section 234 of the Act authorises the making of regulations for the purpose of ensuring the satisfactory management of HMOs. Like licensing, regulation under the Act is concerned with the maintenance of housing standards as regards the physical condition of HMOs and standards of management. Regulations made under section 234 may in particular impose duties on “the person managing” an HMO in respect of repair, maintenance, cleanliness and good order, and the facilities and equipment in it. A person commits an offence if they fail to comply with regulations made under the section.

The Management of Houses in Multiple Occupation (England) Regulations 2006 (“the Management Regulations”) were made under the power in section 234. They apply (by regulation 1) to any HMO in England (other than a section 257 HMO) and are therefore of wider application than the licensing regime which touches only those HMOs to which Part 2 applies. Extensive duties are imposed by the Management Regulations on “the manager” in relation to safety measures, utility supplies, maintenance of common parts and living accommodation and waste disposal. By regulation 3 the manager must ensure that their name and contact details are made available to each household in the HMO and are clearly displayed in a prominent position in the HMO.

The person who bears these responsibilities is “the manager”, an expression defined (with an accompanying footnote) in regulation 2(c) of the Management Regulations as follows:

“2(c) “the manager”, in relation to an HMO, means the person managing¹ the HMO.

1

For the meaning of “person managing” see section 263(3) of the Act.”

The term “person managing” used in sections 72(1) and 234 of the Act and in the definition of “manager” in the Management Regulations is defined in section 263(3) of the Act as follows:

“263.

Meaning of “person having control” and “person managing” etc

…

(3)

In this Act “person managing” means, in relation to premises, the person who, being an owner or lessee of the premises –

(a)

receives (whether directly or through an agent or trustee) rents or other payments from –

(i)

in the case of a house in multiple occupation, persons who are in occupation as tenants or licensees of parts of the premises; and

(ii)

in the case of a house to which Part 3 applies (see section 79(2)), persons who are in occupation as tenants or licensees of parts of the premises, or of the whole of the premises; or

(b)

would so receive those rents or other payments but for having entered into an arrangement (whether in pursuance of a court order or otherwise) with another person who is not an owner or lessee of the premises by virtue of which that other person receives the rents or other payments;

and includes, where those rents or other payments are received through another person as agent or trustee, that other person.”

Section 249A of the Act permits a local housing authority to impose a financial penalty on a person if it is satisfied beyond reasonable doubt that they have committed a relevant housing offence. Relevant housing offences include the offence under section 72 of managing or controlling an unlicensed HMO.

By section 252(1), where an offence under the Act committed by a company is proved to have been committed “with the consent or connivance of, or to be attributable to any neglect on the part of” a director, the director will also commit the offence and will be liable to be proceeded against and punished accordingly.

I mention also that letting agents are subject to separate consumer protection laws and that Part 2 of the Housing and Planning Act 2016 makes “rogue property agents” liable to banning orders prohibiting them from engaging in letting agency work if they committed a “banning order offence”. These offences are listed in the Schedule to The Housing and Planning Act 2016 (Banning Order Offences) Regulations 2018 and include the offences in relation to HMOs created by section 72 of the 2004 Act.