Financial Penalty Appeal Allowed: Notice of Intent Served Late

OUTCOME: Allowed

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : LON/00BH/HNA/2024/0618 Property : 11 [ADDRESS], [POSTCODE] Applicant : [redacted] : [NAME] Respondent : [redacted] Representative : [COMPANY] of application : Appeal against a financial penalty - Section 249A & Schedule 13A to the Housing Act 2004 Tribunal : Judge [NAME] and venue of hearing : 11th September 2025 By remote video Date of decision : 11th September 2025

DECISION

The appeal is allowed and the Final Penalty Notice dated 26th June 2024 is cancelled. Reasons 1. The Applicant owns flats, including the subject property, in a block containing two floors of flats above commercial premises. The local authority Respondent has sought to impose a financial penalty of £15,600 on the Applicant for [NAME] or having control of a House in

2 Multiple Occupation when it should have been licensed but was not, contrary to section 72(1) of the Housing Act 2004 (“the 2004 Act”).

2. The final penalty notice was served on 23rd September 2024. The Applicant appealed to this Tribunal on 21st October 2024.

3. The Applicant’s appeal was originally due to be heard by the Tribunal on 17th June 2025. However, the Tribunal decided to adjourn for the reasons stated in their written decision. One of the issues was that there was a second appeal by the Applicant’s agents, [APPELLANT], and directions were made for the two appeals to be heard together. However, on 27th August 2025 the Tribunal gave consent to [APPELLANT] to withdraw their appeal.

4. The Applicant’s appeal was heard on 11th September 2025. It was converted from a face-to-face hearing to one by remote video due to the difficulties participants may have traveling to the Tribunal during the strike on the [NAME]. The attendees were: • Mr [APPELLANT] [NAME] of [NAME], representing the Applicant; • Mr [APPELLANT] of [NAME]; • The Applicant’s witnesses: o Mr [APPELLANT], director of the Applicant (attending by phone due to lack of access to a device with a screen – the Respondent did not object); o Mr [RESPONDENT], [NAME] Director of [RESPONDENT]; • Ms [COUNSEL], counsel for the Respondent; • Ms [COUNSEL] [NAME], solicitor for the Respondent; • The Respondent’s witnesses: o Ms [RESPONDENT], [NAME] and Licensing Team Manager; and o Mr [NAME], [NAME] and Licensing Enforcement Officer.

5. The directions of 17th June 2025 provided for each party to provide an amended bundle to incorporate documents relating to Grangeview Estate’s appeal but neither did so, presumably for the same reasons as led to the withdrawal. The Tribunal had the same documents as at the previous hearing: • Applicant’s Bundle, 90 pages; • Respondent’s Bundle, 298 pages; and • Respondent’s 7-page Reply.

6. Mr [RESPONDENT] and Ms [RESPONDENT] both provided skeleton arguments, supported by bundles of authorities.

7. The Applicant did not dispute the commission of the offence, putting it down to an inexplicable lapse in administration by their agents, but sought to challenge the Respondent’s procedure and the quantum of the penalty. Their first argument was that the notice of intent was out of time. Since this issue was potentially determinative of the whole appeal,

3 it was considered first. No live witness evidence was required for that purpose. Both parties’ representatives directed the Tribunal’s attention to their respective skeleton arguments and some of the authorities.

8. Under paragraph 1 of Schedule 13A to the Act, before imposing a financial penalty, the local housing authority must give notice of the authority's proposal to do so (a “Notice of Intent”). Under paragraph 2(1), the notice of intent must be given before the end of the period of 6 months beginning with the first day on which the authority has sufficient evidence of the conduct to which the financial penalty relates.

9. Mr [RESPONDENT] inspected the property on behalf of the Respondent on 21st September 2023. In paragraph 20 of his witness statement, he says, On 21 September 2023, I visited 'the property' to confirm if 'the property' was still rented and required to be licenced. I knocked on the door and the door was opened by [NAME] who confirmed receiving the S239 and allowed me access to 'the property'. [NAME] confirmed he lives with his two friends and moved into the property July 2023 and occupies the first- floor rear bedroom. [NAME] confirmed rent was payable of £2,000 per calendar month and was being paid via bank transfer to [COMPANY]. The visit confirmed 'the property' was occupied as an additional HMO which consisted of 3 occupants forming 3 households. All bedrooms were occupied by three single friends.

10. The Respondent sent the Notice of Intent to the Applicant by first class post on 20th March 2024 which means it would have been received after that date.

11. Mr [RESPONDENT] argued that: (a) The Respondent had sufficient evidence on 21st September 2023 of the conduct to which the financial penalty relates. (b) Under paragraph 2(1) of Schedule 13A, the 6-month time limit for giving the Notice of Intent expressly includes that first day. (c) The end of the period comes before the end of 6 months, inclusive of the first day, meaning that, in this case, it was 20th March 2024. (d) The Notice of Intent would not have been received on the same day it was sent, 20th March 2024, and, therefore, was out of time.

12. Ms [NAME] set out four opposing points. Firstly, paragraph 2 of Schedule 13A to the 2004 Act has 3 time periods, not only that in sub-paragraph (1) but also a further two in sub-paragraph (2). Under paragraph 2(2), where the alleged conduct continues, there is no time limit while it continues and the time limit only starts when the conduct stops. Ms [RESPONDENT] pointed out that the Respondent only applied for an HMO licence on 3rd April 2024 and argued that, therefore, the relevant conduct had continued at least until that date.

4 13. The problem with this argument is that the Respondent did not allege in its correspondence with the Applicant that the conduct was continuing. The covering letter to the Notice of Intent (and the Final Notice itself) specify the “Date of the offence” as 21st September 2023. Unlike in Leicester City Council v Morjaria [2023] UKUT 129 (LC); [2023] HLR 42 (see paragraph 46), nowhere else in the covering letter, the Notice itself or the accompanying guidance and information was it suggested that the relevant conduct continued after or related to any date other than 21st September 2023. Any reasonable recipient would have concluded that the representations which were invited related to that date only and any assessment of whether to oppose and, in due course, appeal the penalty depended on considering the evidence the Respondent had to support its claim of an offence on that date alone.

14. Ms [NAME] sought to claim that the relevant conduct clearly continued due to the lack of a licence application but the lack of a licence is only one element of the offence. It is possible to cease committing the offence by other means. Of course, the offence under section 72(1) will normally continue over a period of time but it cannot be assumed that it continued for long enough to bring any Notice of Intent in time. It is perhaps understandable if the [NAME] assumed the relevant conduct was continuing in this case, and that assumption may well be right, but a finding that a person is guilty of a criminal offence cannot be founded on unexpressed assumptions.

15. Put simply, if a local authority wishes to rely on the extended time limits in paragraph 2(2) of Schedule 13A to the Housing Act 2004, they must notify the alleged offender that, in deciding whether to impose a financial penalty, they are relying on conduct for a period continuing after the date when they reached the threshold of sufficient evidence.

16. Secondly, Ms [RESPONDENT] submitted that the Respondent only had “sufficient evidence” when they received a copy of a written tenancy agreement. The Tribunal can understand that the Respondent might have preferred to wait for a copy after they had been told that there was a written agreement in existence before continuing to consider sanctions such as a financial penalty. However, the Tribunal is satisfied that the “sufficient evidence” threshold was passed when Mr [NAME] came into possession of the information he sets out at paragraph 20 of his witness statement (quoted above).

17. As it put to Ms [NAME], the Tribunal knows from its knowledge and experience that the worst of landlords, those most likely to be subject to the financial penalty regime, sometimes don’t provide written agreements. It would be severely limiting if local authority enforcement officers felt they could not proceed without one. There is no suggestion that the rest of the evidence was deficient so as to make a copy of the agreement essential to establishing the case.

18. Thirdly, in Dodds v Walker [1981] 1 WLR 1027 the House of Lords described the “corresponding date rule”: in calculating the period which

5 had elapsed after the giving of a notice, and excluding that day, the relevant period was the specified number of months thereafter which ended on the corresponding day of the appropriate subsequent month. Ms [NAME] argued that the corresponding date rule applied so that the time limit for the Notice of Intent expired on 21st March 2024, not 20th March.

19. Ms [NAME] also relied on [NAME] v Westminster City Council [2014] EWHC 2160 (Admin) in which the corresponding date rule was applied. However, the legislation being considered in that case was worded differently, measuring the relevant period by the months “after” the start date.

20. The Tribunal is satisfied that the wording of paragraph 2(1) of Schedule 13A to the 2004 Act excludes the application of the corresponding date rule. The wording is admirably clear relative to some statutory time limits. In the Tribunal’s opinion, the wording leaves 20th March 2024 as the only possible date for the end of the relevant period.

21. Fourthly, Ms [NAME] argued that the Notice of Intent should be regarded as having been received, in the words of section 7 of the Interpretation Act 1978, “in the ordinary course of post” on 21st March 2024. This submission rested on two matters: (a) That the previous submission had successfully extended the time limit to 21st March 2024. However, the Tribunal rejected that submission. (b) The ordinary course of post would see a first class letter delivered on the day after it was sent. The Tribunal accepts that at least some first class post does arrive on the day after it was sent but, in the absence of any direct evidence of the actual or likely date of receipt, cannot accept that it should be assumed this Notice did. In Newcastle City Council v Abdallah [2024] UKUT 140 (LC); [2024] HLR 33, Judge Rodger KC (at paragraph 25) adopted as a useful rule of thumb the provision in a Practice Direction of the Civil Procedure Rules that the ordinary course of post for first class mail means the second working day after posting. Ms [NAME] correctly pointed out that this comment was obiter and the CPR don’t apply in the Tribunal but this does not diminish the usefulness of this rule of thumb. In the absence of any other evidence, the Tribunal is satisfied that it is preferable to assume the Notice of Intent would have been received in the ordinary course of post on 22nd March 2024.

22. In the circumstances, the Tribunal has concluded that the Notice of Intent was given out of time. Therefore, the Respondent had no power to issue the Final Notice and it must be cancelled.

Name: Judge Nicol Date: 11th September 2025

6 Rights of appeal By rule 36(2) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, the tribunal is required to notify the parties about any right of appeal they may have. If a party wishes to appeal this decision to the Upper Tribunal (Lands Chamber), then a written application for permission must be made to the First- tier Tribunal at the regional office which has been dealing with the case. The application for permission to appeal must arrive at the regional office within 28 days after the tribunal sends written reasons for the decision to the person making the application. If the application is not made within the 28-day time limit, such application must include a request for an extension of time and the reason for not complying with the 28-day time limit; the tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed, despite not being within the time limit. The application for permission to appeal must identify the decision of the tribunal to which it relates (i.e. give the date, the property and the case number), state the grounds of appeal and state the result the party making the application is seeking. If the tribunal refuses to grant permission to appeal, a further application for permission may be made to the Upper Tribunal (Lands Chamber).

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : LON/00BH/HNA/2024/0618 Property : 11 [ADDRESS], [POSTCODE] Applicant : [redacted] : [NAME] Respondent : [redacted] Representative : [COMPANY] of application : Appeal against a financial penalty - Section 249A & Schedule 13A to the Housing Act 2004 Tribunal : Judge [NAME] of decision : 13th November 2025

DECISION ON REIMBURSEMENT OF FEES

The Respondent shall reimburse the Applicant his Tribunal fees of £330. Reasons 1. On 11th September 2025 the Tribunal upheld the Applicant’s appeal against a financial penalty of £15,600 imposed by the Respondent for [NAME] or having control of a House in Multiple Occupation when it should have been licensed but was not, contrary to section 72(1) of the Housing Act 2004 (“the 2004 Act”). The Tribunal held that the Notice of Intent which preceded the Final Notice of the penalty had been served two days out of time.

2 2. On 13th October 2025 the Tribunal refused the Respondent’s application for permission to appeal.

3. The Applicant applied for the Respondent to reimburse his Tribunal fees of £330 (£110 for making the application and £220 for the hearing). At the same time as refusing permission to appeal, the Tribunal directed the Respondent to make written submissions on the issue of reimbursement.

4. The only submission the Respondent made was that the issue of costs should be adjourned pending the determination of their appeal. The Tribunal rejects that submission. Reimbursement is a simple issue and costs are unlikely to be saved by leaving it hanging around indefinitely.

5. On the basis of the Tribunal’s decision, the Respondent should never have served the Final Notice and the Applicant should not have been put to the trouble of making the application, let alone making his case at a hearing. The Tribunal is satisfied in the circumstances that the Respondent should reimburse the Applicant his fees. Name: Judge Nicol Date: 13th November 2025

Rights of appeal By rule 36(2) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, the tribunal is required to notify the parties about any right of appeal they may have. If a party wishes to appeal this decision to the Upper Tribunal (Lands Chamber), then a written application for permission must be made to the First- tier Tribunal at the regional office which has been dealing with the case. The application for permission to appeal must arrive at the regional office within 28 days after the tribunal sends written reasons for the decision to the person making the application. If the application is not made within the 28-day time limit, such application must include a request for an extension of time and the reason for not complying with the 28-day time limit; the tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed, despite not being within the time limit. The application for permission to appeal must identify the decision of the tribunal to which it relates (i.e. give the date, the property and the case number), state the grounds of appeal and state the result the party making the application is seeking. If the tribunal refuses to grant permission to appeal, a further application for permission may be made to the Upper Tribunal (Lands Chamber).