Tenant Wins Rent Repayment Order Against Landlord for Unlicensed HMO

OUTCOME: Allowed in Part

Case References : BIR/00FY/HMF/2019/0003

BIR/00FY/HMF/2019/0004

BIR/00FY/HMF/2019/0005

Property

: 171 [ADDRESS], [POSTCODE]

Applicants

: [redacted]

[NAME] [COUNSEL]

: [APPELLANT]

Respondent: [redacted] : An Application by Tenants for Rent Repayment Orders pursuant to section 41 of the Housing & Planning Act 2016.

Tribunal Members : [NAME] B.Sc.(Est.Man.) FRICS (Chairman)

[NAME] JP

Date of Hearing : None. Paper determination.

Date of Decision : 21st November 2019

____________________________________________________________

DECISION

© CROWN COPYRIGHT 2019

FIRST - TIER TRIBUNAL [NAME] (RESIDENTIAL PROPERTY)

Introduction

1 This is an application by three former tenants of a house in Nottingham for Rent Repayment Orders under section 41 of the Housing & Planning Act 2016 as the house they occupied had been a registered House in Multiple Occupation (‘HMO’) but the HMO Licence expired on 31st December 2018 and had not been renewed. The tenants remained in occupation for several months but subsequently vacated and applied to the First-tier Tribunal (‘FTT’) for Rent Repayment Orders on 19th August 2019.

2 Former tenant and Applicant Mr [APPELLANT] requested an Order for the period 1st September 2018 to 31st August 2019. The other Applicants requested Orders but did not specify the periods for which Orders were requested.

3 [NAME] issued Directions on 3rd September 2019, consolidating the Applications to enable them to be considered together under The Tribunal Procedure (First-tier) Tribunal ([NAME]) Rules 2013, Rule 6.(3)(b).

4 Mr [APPELLANT] made a Submission on 3rd October 2019 on behalf of all three tenants.

5 Mr [RESPONDENT], the landlord, made a Submission on 14th October 2019.

Facts Found

6 [NAME] inspected the property on 12th November 2019. Mr [RESPONDENT] was present but the former tenants had vacated and were neither present nor represented.

7 The house comprises the left hand side of a pair of semi-detached bungalows on a housing estate in Nottingham about one mile west of the city centre. The estate is accessed from the A6514 [ADDRESS] about half a mile north of the Nottingham University campus. The house has no direct road frontage and is accessed by public footpath from [ADDRESS]. The immediate area is residential.

8 The accommodation comprises a hall and stairs, three bedrooms, kitchen, bathroom and veranda on the ground floor with two further bedrooms and a second bathroom on the first floor in a converted attic. There are gardens to the front and rear.

Relevant Law

Statute

9 Section 41(1) of the Housing and Planning Act 2016 provides:

‘A tenant or a local housing authority may apply to the First-tier Tribunal for a rent repayment order against a person who has committed an offence to which this Chapter applies.’

10 Section 40(3) of the Act lists 7 categories of offence and offence no.6 referring to section 95(1) of the Housing Act 2004 identifies the offence as: ‘control or management of unlicensed house.’

11 Section 95 (1) of the Housing Act 2004 provides:

‘A person commits an offence if he is a person having control of or managing a house which is required to be licensed under this Part … but is not so licensed.’

12 The house is required to be licensed as a HMO as the area was originally designated by Nottingham City Council for selective licensing and since 1st January 2019 for additional licensing. It had previously been licensed under section 64 of The Housing Act 2004 from 13th October 2017 to 31st December 2018 but the license expired and had not been renewed.

Contract

13 Mr [APPELLANT] provided a copy document between [NAME], an agency, dated 6th September 2018 that appeared to be a tenancy agreement between ‘Mr [NAME] [RESPONDENT]’, landlord, and ‘Mr [APPELLANT]’, tenant, for a period of 12 months from 6th September 2018 to 5th September 2019 at a rent of £299.00 per calendar month. It referred to a deposit of £300.00 in section 1 but under the heading ‘Special Tenancy Conditions’ stated ‘The deposit will be used to offset the last month’s rent’.

14 Mr [APPELLANT] provided a Schedule of rent payments with the application advising that he had paid £898.00 on 7th September 2018 and nine further payments of £300.00 per month, i.e. effectively 12 months’ rent of around £300.00 per month.

15 As a preliminary issue the Tribunal found this ‘agreement’ was not in fact an agreement at all and at best only a draft because:

1 the rent reserved in the draft was £299.00 per month but in fact the tenant had paid £300.00 pcm (evidenced by copy bank statements), i.e. the rent paid did not match the rent reserved;

2 the landlord was shown in the draft as ‘[NAME] [RESPONDENT]’ but the landlord shown on the previous expired HMO license was ‘[RESPONDENT]’ who provided the Submission for the application i.e. there was a question of the landlord’s identity;

3 the copy ‘Agreement’ had only been signed by Mr [APPELLANT], not the landlord and no action could be brought against a party who was not a signatory to a signed document and

4 in his Submission, Mr [APPELLANT] stated ‘The landlord, Mr [RESPONDENT], and I signed a seperate contract, to that of Tristram’s one, of which he did not provide a copy for me to hold’, in other words, Mr [APPELLANT] said there had been another Tenancy Agreement of which this was not a copy.

It is not clear why the draft had been provided. Nevertheless, it was not disputed by Mr [APPELLANT]’s or Mr [RESPONDENT]’s [APPELLANT] that Mr [APPELLANT] had been a tenant and had paid £3,598.00 for a year’s rent.

[APPELLANT]

Applicant

16 Mr [APPELLANT] said in a brief statement that he rented the house from 6th September 2018 to 1st September 2019 when it was required to be licensed and had not been, accordingly he requested a Rent Repayment Order for the full period of his occupation. He provided copies of bank statements showing periodic payments to ‘[NAME]’ (letting agents) and ‘[NAME] [RESPONDENT]’ as evidence.

Respondent

17 Mr [RESPONDENT] made four points:

1 he refuted the claim for the period to 31st December 2018 as he had a valid HMO licence until that date.

2 He said Mr [APPELLANT] had not been a student and was required to pay Council Tax of £119.50 per month as part of the £300.00 monthly rent, i.e. the rental element was only £180.50 per month.

3 Mr [APPELLANT] had damaged the house and furniture and he asked the Tribunal to deduct the cost of remedying this (claimed at £1,890) from any Rent Repayment Order;

4 Mr [RESPONDENT] was a single parent which was a personal circumstance to be taken into account by the Tribunal.

18 Tribunal Decision

The Tribunal considered the points and finds as follows:

1 Mr [APPELLANT] had been a tenant from 1st September 2018 to 31st August 2019, during which time he paid rent of £300.00 per calendar month.

2 The landlord was required to have a valid license for the property and by not having a license he committed an offence from 1st January 2019. There was no evidence that the license had been renewed although Mr [RESPONDENT] said he had made an application which the Council had rejected as incomplete.

Accordingly, the Tribunal finds beyond reasonable doubt that an offence was committed from 1st January 2019 to 1st September 2019 in respect of Mr [APPELLANT]’s tenancy.

3 The Tribunal are unable to deduct any amount in respect of alleged damage to the property. The Tribunal have no jurisdiction in this. Any costs of this nature would need to have been claimed from a deposit which would have been the subject of a separate dispute with the tenant at the date of vacation and in the event of non- agreement, settled by the appropriate arbitration authority, e.g. the [NAME].

4 There was no evidence that Mr [APPELLANT] was required to pay Council Tax to Mr [RESPONDENT] and no deduction is made on this ground.

5 The Tribunal makes no allowance for Mr [RESPONDENT]’s status as a single parent. The Tribunal are required to take account of the landlord’s and tenant’s conduct, the landlord’s financial circumstances and any previous convictions under section 44 of the Housing and Planning Act 2016 but there was no evidence to show any financial hardship by Mr [RESPONDENT].

6 Accordingly, the Tribunal makes a Rent Repayment Order requiring [NAME] [RESPONDENT] to pay eight months’ rent of £300.00 per month, i.e. £2,400 (Two Thousand Four Hundred Pounds), to Mr [APPELLANT] with immediate effect.

[APPELLANT]

Applicant

19 Mr [APPELLANT] produced no tenancy agreement showing the dates of his tenancy. He produced a photocopied bank statement showing a cash withdrawal of £1,800 on 12th

March 2019 but no evidence to show that any rent had been paid to Mr [RESPONDENT] for this property.

20 Respondent

Mr [RESPONDENT] acknowledged that Mr [APPELLANT] had been a tenant but said he had received no rent from him in 2019 and in addition Mr [NAME] produced no evidence to the Tribunal that he had paid any rent.

21 Tribunal Decision

With no proof of any tenancy to Mr [NAME] or evidence of rental payments, the Tribunal are unable to make an Order. Accordingly the Tribunal dismisses Mr [NAME] application.

[NAME] (identified as ‘[NAME] on the Application but full name appears on copy bank statements sent to the Tribunal)

Applicant

22 Mr [APPELLANT] produced no tenancy agreement showing the dates of his tenancy. He produced photocopied bank statements showing payments of £782.29 to ‘[NAME]’ on 20th July 2018, various cash withdrawals and payment of £767.00 to ‘[NAME]’ on 6th June 2019, but no evidence to show that any other rent had been paid to Mr [RESPONDENT] for this property.

23 Respondent

Mr [RESPONDENT] acknowledged that Mr [APPELLANT] had been a tenant and had paid ‘the correct amount directly into the landlord’s account’ on 6th June 2019, but said there was no evidence that he had paid any other rent.

24 Tribunal Decision

The Tribunal considered the points made and finds as follows:

1 Mr [APPELLANT] had been a tenant of the property.

Accordingly, the Tribunal finds beyond reasonable doubt that an offence was committed from 1st January 2019 to the date of Mr [NAME] vacation.

3 The Tribunal makes no allowance for Mr [RESPONDENT]’s status as a single parent. The Tribunal are required to take account of the landlord’s and tenant’s conduct, the landlord’s financial circumstances and any previous convictions under section 44

of the Housing and Planning Act 2016 but there was no evidence to show any financial hardship by Mr [RESPONDENT].

4 [NAME] had paid rent of £767.00 to the landlord’s account on 6th June 2019 as acknowledged by the landlord. No other payments are evidenced.

5 Accordingly, the Tribunal makes a Rent Repayment Order requiring [NAME] [RESPONDENT] to pay £767.00 (Seven Hundred and Sixty Seven Pounds) to Mr [NAME] with immediate effect.

[NAME] B.Sc.(Est.Man.) FRICS Chairman, First-tier Tribunal [NAME] (Residential Property)

Date: 21 November 2019

Application to the Upper Tribunal

If any party is dissatisfied with this decision they may apply to the First-tier Tribunal for permission to appeal to the Upper Tribunal, [NAME] (Residential Property), within 28 days of the date this decision is sent to the parties. Any such request should identify the decision to which the appeal relates, stating the grounds on which the party intends to rely in the appeal and the result sought by the party making the application.