Renee Daff v Aris Gyalui & Anor

When fixing a rent repayment order, a tribunal must take the landlord’s financial circumstances into account under Housing and Planning Act 2016, section 44(4), including relevant information already before it. If the evidence is incomplete, the tribunal may need to ask questions, particularly where a party is unrepresented.

The seriousness of the offence remains central, but landlords should not be classified simply as “professional” or “amateur” as a threshold for a different penalty. All relevant circumstances must be assessed. Rent repayment orders are punitive and deterrent rather than compensatory, and their amount must not be disproportionate.

The First-tier Tribunal (Property Chamber) ordered Renee Daff to repay £22,230 to her former tenants under section 43 of the Housing and Planning Act 2016. The order followed her admission that she had controlled an unlicensed Part 3 house contrary to section 95(1) of the Housing Act 2004.

Ms Daff appealed, arguing that the FTT had failed to consider evidence of her poor health, limited income, financial commitments and property assets. She also argued that the FTT had taken too narrow an approach to the later exemption of the property from selective licensing. The Tribunal allowed the appeal on the first ground and redetermined the amount payable.

1. Appeal allowed. The FTT’s decision was set aside because it fixed the amount of the rent repayment order without taking account of relevant evidence concerning Ms Daff’s financial circumstances, contrary to section 44(4)(b) of the Housing and Planning Act 2016. The FTT’s statement that her circumstances were unknown because she had made no financial disclosure was factually incorrect.
2. A tribunal determining a rent repayment order must consider the landlord’s financial circumstances. It may not disregard material already contained in the hearing bundle merely because the evidence is incomplete. A tribunal may ask its own questions to obtain relevant information. That inquisitorial function is particularly important where a party is unrepresented. Unsupported oral evidence may have limited weight, but the absence of corroboration does not remove the statutory duty to consider the issue.
3. The later notification that the property was exempt did not establish retrospective exemption during the tenancy. The Tribunal identified three possible categories of exemption under Part 3 of the Housing Act 2004: the dwelling may not be a Part 3 house; the tenancy or licence may be exempt; or a temporary exemption notice may be in force. The applicant bears the initial burden of showing that a licence was required. Once the property is shown to lie within a selective licensing area, the respondent will usually need to establish the circumstances relied on for exemption.
4. For quantum, the Tribunal applied the approach described in Acheampong v Roman [2022] UKUT 239 (LC): identify the rent, deduct tenant-only utility costs, assess the seriousness of the offence, and then adjust the resulting figure in light of the factors in section 44(4). The unlicensed-house offence was towards the lower end of the relevant range, although licensing enforcement remains important.
5. The description of a landlord as “professional” or “amateur” is not a threshold determining the penalty. The scale of the property portfolio and the circumstances in which property is let are relevant, but all the circumstances must be considered. Ms Daff had never made a living from the portfolio, had serious illness, no employment income and a precarious financial position. A disproportionate penalty was unnecessary to achieve punishment and deterrence.
6. The appropriate order was £2,000, payable equally to the two respondents. Rent repayment orders are not compensatory and need not always be divided in proportion to the tenants’ respective rent contributions.

• Upper Tribunal (Lands Chamber): allowed the appeal on the failure to consider financial circumstances, rejected the separate exemption ground, set aside the FTT’s order and substituted an order for £2,000.
• First-tier Tribunal (Property Chamber): on 1 March 2022 ordered repayment of £22,230 under section 43 of the Housing and Planning Act 2016.