Robert Hallett v Alex Parker & Ors

In fixing a rent repayment order under Housing and Planning Act 2016, the tribunal must evaluate all relevant circumstances. It must not begin with a presumption that all rent paid should be repaid, subject only to limited adjustment.

The landlord’s conduct includes the circumstances and relative seriousness of the housing offence. A maximum order for a licensing offence will ordinarily be exceptional and reserved for the most serious cases. Matters insufficient to establish a reasonable excuse may nevertheless mitigate the amount. Relevant matters may include reliance on a professional agent, the landlord’s scale of operation, the condition of the accommodation, and prompt compliance once the requirement is known.

The appellant landlord let a flat to three unrelated tenants. The letting made the flat a house in multiple occupation requiring a licence, which the landlord did not obtain until he was informed of the requirement. The tenants applied for a rent repayment order for rent paid during the unlicensed period.

On 6 July 2021, the First-tier Tribunal rejected the landlord’s reasonable-excuse defence and ordered repayment of the whole rent paid, £11,712.75. The landlord appealed only against the amount. The issue was whether the First-tier Tribunal had failed to take account of mitigating matters when applying section 44(4) of the Housing and Planning Act 2016.

1. Appeal allowed. The First-tier Tribunal’s order was set aside because it adopted the wrong starting point. It treated full repayment as the default unless the landlord established a reason for a discount. That approach was inconsistent with Williams v Parmar [2021] UKUT 244 (LC).

2. Under section 44(4) of the Housing and Planning Act 2016, the tribunal must assess all relevant circumstances when fixing the sum. The specified matters are not exhaustive. The landlord’s conduct includes the circumstances and seriousness of the offending conduct. Rent repayment orders are deterrent and punitive rather than compensatory, but they must not be harsher than necessary to achieve the statutory objectives.

3. Where section 46 does not require the maximum sum, full repayment should be reserved for the most serious cases warranting an exemplary sanction. A licensing offence may exceptionally justify that result, including repeat offending, but it will not usually do so.

4. A reasonable excuse and mitigation are distinct. A landlord who proves reasonable excuse commits no offence. But a circumstance which fails to establish that defence may still reduce the appropriate order. The First-tier Tribunal should therefore have considered the agent’s failure to alert the landlord to the licensing requirement, the single-property letting, the landlord’s ignorance, the good condition of the flat, and his prompt application for a licence.

5. The Tribunal remade the decision. Taking both the need to enforce licensing requirements and the mitigating circumstances into account, it ordered repayment of £1,000 to each tenant, a total of £3,000, approximately 25% of the relevant rent.

• Upper Tribunal (Lands Chamber): Allowed the landlord’s appeal and remade the rent repayment order: [2022] UKUT 165 (LC).
• First-tier Tribunal (Property Chamber): On 6 July 2021, rejected the reasonable-excuse defence and ordered repayment of £11,712.75. No citation is stated in the judgment.