Background

How Rent Repayment Orders came about

An afterthought in a 2004 bill, turned into a real remedy by the 2016 Act, and doubled in reach by the Renters’ Rights Act. Knowing why the power exists explains a good deal about how tribunals use it.

The Housing Act 2004: the RRO as a compromise

Rent Repayment Orders were essentially an afterthought in the bill leading to the Housing Act 2004. The Act made letting a house in multiple occupation without a licence illegal. Rather late in the bill, it was realised that if letting an unlicensed HMO were illegal then tenants of such properties could argue their contracts were illegal and withhold their rent.

To avoid that potentially chaotic situation the RRO was invented as a classic British compromise. The 2004 Act specifies that tenants’ contracts in unlicensed HMOs continue to operate and that tenants must continue to pay rent — but gives them the chance to reclaim that rent if the landlord was successfully prosecuted by the local authority for operating an HMO without a licence.

In practice not many tenants could get their rent back, because not many landlords were prosecuted. The 2004 Act did not allow a direct claim by a tenant without a prior conviction.

The Housing and Planning Act 2016: a shift in power

The 2016 Act tried to get tough on rogue landlords and recognised some of the shortcomings of the 2004 Act. Local authorities had generally not prosecuted many landlords for operating unlicensed HMOs — on average about one a year.

In effect the 2016 Act hands part of the policing of the legislation to tenants themselves, by allowing a tenant to start a claim without waiting for the local authority to act first. It also brought in other landlord offences for which an RRO may be claimed: violent entry, harassment, failure to comply with improvement or prohibition notices, and breach of a banning order.

So the RRO became far more powerful under the 2016 Act than it had been under the 2004 Act. It is more a punishment of the landlord than simply a repayment of rent.

Our position: repayment without deductions

For years, tribunals deciding cases under the 2016 Act took their lead from appeal decisions made under the 2004 Act. We have always said that is wrong.

Those earlier decisions rested on the wording of the 2004 Act. In Parker v Waller (2012) the judgment relied heavily on section 74(5), which provided for the amount to be such amount as the tribunal considers reasonable in the circumstances. The 2016 Act contains no such test of reasonableness, so reliance on the 2004 Act appeals was misplaced.

We have seen hearings in which landlords’ expenses were examined in immense detail. That is a waste of expensive judicial time. An unlicensed landlord is a rogue landlord and should be punished — not rewarded for having his tenants pay his mortgage while he takes the capital appreciation, not rewarded for his tenants keeping the house warm and aired by deducting utility bills from their award, and not rewarded for setting capital expenditure on an illegally let property against it.

And then the Renters’ Rights Act

The Act that took effect on 1 May 2026 is the biggest change since the power was created: up to twenty-four months’ rent instead of twelve, two years to apply instead of one, superior landlords and company officers brought back into range, three new offences, and a rule that forces the maximum award where a final financial penalty has been imposed for the same offence.

Working on the law

Flat Justice challenges RRO judgments we believe are wrong by assisting appeals to the higher courts, which creates case law that helps every applicant, not only our own clients. If you have a case that raises a point of principle, tell us about it.