Rent Repayment Order Decision

Where an HMO contains five or more persons who occupy the premises as their only or main residence and who form two or more households, the landlord must obtain a licence from the local housing authority. Failure to do so is an offence. Where the First-Tier Tribunal (Property Chamber) is satisfied beyond reasonable doubt that a landlord has committed an offence it may make a “rent repayment order” requiring the landlord to repay some or all of the rent to the tenant, to a maximum of 12 months rent.

In Acheampong v Roman [2022] UKUT 239 (LC), the Upper Tribunal decided that the correct assessment procedure was as follows: First, ascertain the total rent paid during the relevant period; secondly, deduct any element of the rent which is actually a payment for utilities or other matters which only benefit the tenant (e.g. gas, electricity, internet access); thirdly, assess the seriousness of the offence both in comparison to other types of offence in respect of which a rent repayment order can be made and in relation to the same type of offence; fourthly, assess what proportion of the rent reflects that seriousness; and, finally, make any adjustments necessary (whether upwards or downwards) to reflect any wider mitigating or aggravating factors.

In the case of Dowd v Martins and others [2022] UKUT 249 (LC) the appellant was the landlord of the respondents at a property which should have been – but was not – licensed as an HMO. The respondents sought a rent repayment order and the First-Tier Tribunal (FTT) found in their favour. The appellant appealed to the Upper Tribunal. He argued that – as regards one of the respondents – the FTT had erred at the first stage of the assessment. That applicant had occupied a room in the property with her partner and they had been jointly and severable liable for the rent; her partner had previously been part of the rent repayment order application but had settled with the appellant and the FTT should have therefore found that the total rent paid in respect of the relevant period was only the 50% attributable to her occupation. He further argued, as regards all of the respondents, that the FTT had failed to assess the seriousness of the offence.

The appeal was allowed. Where one joint tenant had settled their rent repayment order claim it could not possibly be fair that the other joint tenant could claim the whole of the rent in their application. It followed that the FTT should have – at stage 1 – divided the total sum paid by two in order to ascertain the maximum possible award to the one remaining joint tenant. The FTT had also failed to make any assessment of the seriousness of the offence. The Upper Tribunal re-made the decision and awarded between £1,800 and £3,113 per occupier (representing c.45% of the rent).

For advice on Rent Repayment claims, contact Oliver Kew at o.kew@hewetts.co.uk

Published on 01/11/2022