Fah Hor Chong v Eleonora Severgnini & Ors

Where a landlord relies on reasonable excuse or an alleged licence application as a defence to an unlicensed HMO offence, the First-tier Tribunal must engage with the substance of the evidence, make findings on disputed material facts, and explain its conclusions. It must consider evidence about what the licensing authority told the landlord and whether the steps taken amounted to an application. If the evidence establishes no defence, it may nevertheless be relevant to mitigation when determining a rent repayment order. A failure to address relevant evidence or give adequate reasons is an error of law requiring the decision to be set aside.

The landlord appealed against rent repayment orders made in favour of three tenants of an HMO in London. He accepted that the property required a licence under the local additional licensing scheme but relied on the statutory defence of reasonable excuse and contended that he had made licence applications through the local authority’s online portal in 2021.

The First-tier Tribunal found that no application had been made and that the reasonable-excuse defence was not established. The Upper Tribunal considered whether the FTT had properly addressed the landlord’s detailed evidence about his online applications, his conversation with a local authority officer, and the subsequent disappearance of the application records.

1. Appeal allowed. The First-tier Tribunal’s decision was set aside and the matter was remitted to the FTT for redetermination by a different panel.
2. The FTT recorded some of the landlord’s evidence but failed to engage with its substance. It misunderstood the evidence by stating that he had said he did not submit the application, when his case was that applications had been made but were not processed.
3. The FTT had to make findings about the landlord’s account of his conversation with the local authority officer. That account was that he sought assistance, understood that his applications would be treated as valid and backdated, and was told to await further contact. If the FTT rejected that account, it had to explain why. It also had to address whether the application material had been deleted and make an express finding on that issue.
4. The finding that the steps taken did not amount to an application under Housing Act 2004, section 72(4)(b), might or might not be correct, but required explanation because it potentially conflicted with the officer’s alleged advice.
5. If the FTT accepted the landlord’s account of the officer’s advice, it had to consider whether he had a reasonable excuse under section 72(5). Even if no defence were established, the evidence might be relevant mitigation when assessing the amount of any rent repayment order under Housing and Planning Act 2016.
6. The failure to take relevant evidence into account and explain the conclusion constituted an error of law.

• First-tier Tribunal (Property Chamber): Made rent repayment orders against the landlord in favour of the three tenants and ordered reimbursement of their tribunal fees.
• Upper Tribunal (Lands Chamber): Allowed the appeal, set aside the FTT’s decision, and remitted the matter for redetermination by a different panel.