An Upper Tribunal has ruled that Rent Repayment Orders are to be made on a sliding scale of a landlord’s ‘badness of behaviour’.
It has only awarded 80% of the rent to six former tenants who lived in an unlicensed HMO with two category 1 hazards of fire safety and excessive cold, where one of the bedrooms was too small under the licensing scheme. The court over-ruled a First Tier Tribunal that had awarded the tenants 100% of rent, minus an amount for utilities costs, after the landlord, Amanda Williams, appealed.
Describing herself as a ‘professional landlord’ with a ‘modest portfolio’ of properties, she applied for a licence in February 2020 on the property in Afghan Road, London, shortly before the tenants left in March 2020, but the application was rejected based on the room size and the lack of remedial works.
The Upper Tribunal judge ruled: “If a landlord has not previously been convicted of a relevant offence, and if their conduct, though serious, is less serious than many other offences of that type, or if the conduct of the tenant is reprehensible in some way, the amount of the RRO may appropriately be less than the maximum amount for an order.”
Giles Peaker, partner at Anthony Gold Solicitors, tells LandlordZONE that since 2020 the starting point for payments has been 100% of the rent, but that would now only be for the most serious cases. For those whose landlord has just simply not licenced a property it could mean they might only get much less. “It will mean more uncertainty for tenants until there’s been a few more appeals and you might see a battle about who has behaved worse – landlords or tenants,” he says.
“There will be a lot of variation in FTT decisions, and doubtless a lot of appeals, by landlords trying to argue that although their behaviour was quite bad, it wasn’t all that bad, and tenants arguing that their landlord’s behaviour should properly be regarded as atrocious.”