10 Decisions of the London First-tier Tribunal (property chamber) from 2018 on Rent Repayment Order applications

Getting hold of decisions by the Residential Property Tribunal can be rather difficult. They seem to be having an IT problem…for quite some time now. This is a pity as public access to such documents is recognised by HMCTS (Her Majesty’s Courts & Tribunal Service) as an important check on the accountability of the Courts system (https://www.judiciary.uk/wp-content/uploads/JCO/Documents/Consultations/accountability.pdf).

After over a month of negotiation, we have now received 10 copies of decisions on Rent Repayment Orders brought by tenants under the 2016 Housing & Planning Act in London. We are led to understand that this is the total number of cases heard at the First-tier Tribunal Residential Property Chamber (FtT) in London under this Act.
We are waiting for confirmation that we can publish these on our site: don’t hold your breath. In the meantime, I thought it could be useful to present some analysis of the cases so far and compare the methods used in arriving at decisions.
The decisions are all from this year, February to September, which makes me suspect that there may have been some more from last year. All were successful apart from one. There were 3 applications each for Greenwich and Camden and 1 each for RBKC, Hammersmith & Fulham, Ealing and Richmond.
Of the 10 cases, 9 were heard on the basis of running an unlicensed HMO and 1 for failure to comply with an improvement notice. One of the “unlicensed” cases also brought the charge of harassment but seemed to decide in the hearing to only have the case heard on the licensing offence. Most tenants had complaints about the landlord and/or agent’s management of the property.
In 2 of the unlicensed cases the landlords had already been fined. One, in RBKC, had been fined £50,000 and, it emerged during the hearing, had apprently previously been fined £214,000. Both these cases resulted in 100% awards by the judges who also did not consider any expenses from the landlord. Weirdly, in the RBKC case above, neither the applicant (so, none of the 9 tenants!) nor the respondent bothered to turn up to their hearing. Had the respondent turned up and offered some sort of defence, the judges intimated that the case would have been struck off…and the landlord would have saved over £25,000. Just shows: you do really have to go to the tribunal!
In the cases where no prior conviction existed the pattern for decisions was similar:

  1. Establish the total amount of rent paid during the time when the property was unlicensed and before any licence had been applied for (call this Gross Rent)
  2. Establish any ‘allowable’ expenses of the landlord, eg utility bills for utility inclusive rents (Costs)
  3. Establish the behaviour of the landlord & tenant in relation to the offence
  4. Establish the financial position of the landlord and ability to pay
  5. Decide on a percentage to apply based on 3&4 above
  6. Award = % x (Gross Rent-Costs)

None of the above is specified in the legislation and is a process that was arrived at for cases under the 2004 Act through decisions in the Upper Tribunal. We do not believe that this is correct as the 2016 Act does not ask Tribunals to consider whether the award should be “reasonable in the circumstances” (as it does in the 2004 Act): see our more in-depth discussion here https://www.getrentback.org/guide%20case%20law.html
Even when a respondent (landlord) did not answer communications from the tribunal, refused delivery of evidence bundles and did not show up to the hearing, the tribunal still reduced the award to 80% of the rent claimed. This after the judges wrote: “the respondent has taken no steps in these proceedings to demonstrate that it takes seriously its obligations as landlord and has wholly failed to participate in the hearing of this matter”. So, when a landlord shows the Tribunal a middle finger, the decision still allows for a reduction in the RRO…bizarre.
Of course, patterns are there to be broken. In one case (LON/00AL/HMK/2018/0022), no percentage reduction was made, only the deduction of landlord costs. In another, the award was made on the basis of a lump sum for each tenant which was not calculated in any way relating to the rent paid(LON/OOAG/HMK/2018/0003). Yet another awarded 100% without any deductions (LON/OOBD/HMK/2017/0012): a shining example!
Perhaps the most bizarre was case LON/00AJ/HMK/2018/006, where the judges considered, on really very little evidence, that the landlord might be in financial difficulty. The landlord’s solicitor argued at every step to use the case law relating to the 2004 Act and this seems to have been complied with wholeheartedly, reducing the claim of £32,586 in rent paid to an eventual RRO award of just under £2000…appeal anyone?
In the case that failed to receive an award, the landlord had applied for a licence at the earliest possible date but Greenwich, the LA concerned, had informed the tenant that they had received the application only some months later. Greenwich did not consider the landlord’s original application as valid as the property required a fire safety system (the specifications for which they apparently could not supply the landlord at time of application!). As the judges wrote:
“If Greenwich do operate in this way, they are opening landlords to possible criminal prosecution and liability for RROs in circumstances where they are not at fault.”
The judges argued that the licence application should have been recorded as having been made at the original date but for a later determination. Consequently, the tenant had been misled regarding the date of application by the landlord and everybody’s time had been wasted: Greenwich, please note! (Case number: LON/00AL/HMK/2018/0034).
In summary:
• Most judgements have relied on guidance from Upper Tribunal (UT) cases under the 2004 Act, whilst often admitting that this guidance might not be applicable to 2016 Act cases
• Huge variation in award calculations, from 100% to 25% of rent paid, and variation in factors taken into consideration
• There have been really very few cases so far brought by tenants for RRO under the 2016 Act, although the vast majority of applications have been very successful.