68 Ladbroke Road, Redhill, RH1 1LB CHI/43UF/HMF/2021/0009
DECISION
[1]On 17 March 2021 the Tribunal received an application under section 41 of the Housing and Planning Act 2016 (the Act) from the Applicant tenant for a rent repayment order (RRO) against the Respondent landlord. The amount claimed is £5,215 for the period 1 July to 31 December 2020[2]The Applicants state that the property in question did not have a HMO licence. The Applicants produced a witness statement from Rebecca Lade, Environmental Health Officer for Reigate and Banstead Borough Council dated 12 March 2021. Ms Lade stated that the property was a HMO as at 29 December 2020 and that it fell under the requirements of the Mandatory HMO Licensing. Ms Lade requested the Respondent to complete a valid HMO licence application which he did on 5 February 2021.[3]Directions were issued on 23rd April 2021. These directions included the matter being listed for a remote hearing.[4]Within this decision references in brackets [] are to pages within the hearing bundle. The Law[5]The relevant law is contained within the Housing and Planning Act 2016 (“the Act”). The relevant sections are set out in Annex A. Hearing[6]The below sets out the salient and important parts of the two days hearing of this matter. It is not a transcript of the hearing but focusses on those matters which the Tribunal has determined have been most relevant in reaching its determination.[7]The hearing was attended by both Applicants. The Respondent attended together with his wife who was assisting him as well as Mr Muhammad Wasif Amin and Mr Michael Wilding as witnesses.[8]At the beginning of the hearing the Tribunal checked all parties could hear and be heard. The parties were reminded that the hearing was being recorded. At the end of the hearing the parties confirmed to the Tribunal they had been given the opportunity to say everything they wished to say.[9]Mr Daly stated at the start that he accepted the Property was an HMO during the Applicants tenancy and it did not have a licence. He stated as soon as this was bought to his attention he made an application to the local authority and had been granted a licence. He explained he had previously had a licence for the property but gave this up and stopped using the basement as a room. He thought he did not need a licence and so had a reasonable excuse.[10]Mr Daly accepted that the tenants had paid £4530 as per the evidence at [139 & 140].[11]Ms Jones advised that Ms Garber found the proceedings stressful and she did leave the room although she returned later in the hearing.[12]Mr Jones confirmed the evidence he had given in the bundle [29] was true.[13]He was cross examined by Mr Daly.[14]He denied smoking cannabis at the Property. He said Mr Wilding was always smoking in his room.[15]Mr Jones said he did ask to leave earlier than 6 months but was told would have to stay for the minimum 6 month term as per the tenancy agreement [17]. He and his partner wished to leave as the room was damp and there was mould. He agreed initially told he could leave but the offer they had on an alternative property fell through.[16]On questioning by the Tribunal Mr Jones confirmed that he believed the rent was all inclusive of bills. The rent increased to £700 as a cleaner was arranged for the house. He was happy to pay this increase to have a cleaner. The cost was an extra £15 every 4 weeks.[17]Ms Garber (who had returned) stated that they left the property in good condition. The Applicants relied on the receipt for the return of their full deposit [18] dated 28th December 2020 as evidence of this.[18]Mr Jones confirmed they did not receive any Universal Credit whilst living at this address. He believed all the occupants were working and not students.[19]He explained that there were a few changes in occupants whilst they lived at the Property. The couple on the ground floor changed to a single lady. He explained there was a basement room, 2 rooms on the ground floor together with a kitchen and utility room and 4 bedrooms and 2 bathrooms on the first floor.[20]Mr Jones confirmed they did not have access to the garage which Mr Daly retained for storage. At times access to the kitchen was difficult due to the number of people living in the house.[21]Mr Daly then presented his case.[22]He explained he paid all the bills. He also explained he had to pay the mortgage on the property and account should be taken of all of these.[23]He relied upon his statement [146] and confirmed the same was true.[24]He relied on the schedule of utility and other bill payments [131 and 132] to which also mortgage payments need to be added.[25]On cross examination he told Mr Jones that he had agreed to them leaving and having all their deposit back as a gesture of goodwill. He agreed this to the stress they were causing him and to sort the house out.[26]Mr Daly was then asked questions by the Tribunal.[27]He relied upon the bills he had to hand. He accepted these may not be the bills for the period of the Applicants occupation, but they were the bills he had to hand when dealing with the application and they would be for very similar amounts as the relevant period.[28]He explained the lead tenant would pay some of the bills on his behalf such as the Virgin media bill. He calculated the amounts as per occupant not per room. He felt this was fair. He had divided the amounts by six.[29]He confirmed the property had full gas central heating and hot water provided via the same boiler and a hot water cylinder. He retained the garage for storage. There was a washing machine and drier in the utility room. He confirmed he agreed with Mr Jones description of the Property.[30]He explained Wasif Amin deals with everything for the house and is the lead tenant. He manages the property for him and keeps an eye on everything, including finding and vetting tenants etc.[31]He confirmed he has 3 properties which he lets including No 68 Ladbroke Road. The other two are let to families using a letting agent. He is not a member of any landlords association. All the properties are within Reigate and Banstead and his home address falls within the Borough.[32]He explained that Mr Amin lives in the house next door. He does not pay him anything for looking after No 68.[33]Mr Daly called Mr Amin. He confirmed his statement [152] was true.[34]Mr Jones had no questions.[35]The Tribunal questioned Mr Amin.[36]He said he told the Applicants to stop taking drugs. He said they denied taking drugs. He explained he wanted to reach an agreement with them so they would leave and he would get peace. Mr Daly told him to act nicely as otherwise due to Covid it may be difficult to get the Applicants out of the house.[37]He confirmed he told them on the day they leave he would return all of the deposit.[38]He stated he gave them verbal notice. He confirmed he did not give a written notice, it was a verbal notice he was referring to in his witness statement when he stated that he had served an Eviction Notice.[39]He explained he lived in number 70 Ladbroke Road. Originally his cousin was living in number 68 and he got involved to help Mr Daly out. He explained that he collects the rents, he pays some bills and Mr Daly pays the others. He stated he does not get paid for this; he just lives next door. He holds the deposits for Mr Daly. He did not know the deposits should be placed in a Government scheme.[40]He confirmed he is a Chartered Accountant. His property is rented from Mr Daly, originally via agents but he now deals direct. He is not Mr Daly’s accountant.[41]He explained he would visit No 68 3 or 4 times a week to provide toilet rolls and check all is ok. None of his family live there now. He believed that the difference in bills between the current and last year would be very small and insignificant.[42]Mr Daly then called Mr Wilding. He confirmed his statement [154] was true.[43]On questioning by the Tribunal Mr Wilding confirmed he had lived in the property for the past 16 years. He was employed by Mr Daly working in construction.[44]In closing Mr Daly explained the bills were in the bundle. He also sought to recover the costs of various works he said he had to undertake to the property including the fact, he said, he had to redecorate the whole house due to the cannabis being smoked by the Applicants.[45]He confirmed the Applicants did take him to court over the non-protection of the deposit. He had settled this with their solicitor when he said he would bring a counterclaim for the damage to the Property.[46]The case was causing him a lot of stress. He was a working man trying to do the best he could and the Applicants are simply doing this for money. Decision[47]The Tribunal thanks all parties for their assistance and the measured way everyone approached the case notwithstanding the obvious stress all felt. The Tribunal has considered carefully all of the documents within the bundle and the oral evidence which it heard.[48]Mr Daly candidly conceded at the start of the hearing that throughout the period of occupation the Property was an unlicensed HMO. He accepted he should have had a licence for this period on the basis that 5 or more persons were occupying the Property.[49]Mr Daly suggests he had a reasonable excuse. He explained how previously he had a licence but choose to cease having a licence by way of not letting the basement. The evidence of the Applicants was that the basement was occupied and so, even on Mr Daly’s understanding, it should have had a licence. Mr Daly describes himself as a businessman with other let property. He knows the subject property is let on a room by room basis, this is his choice. He delegates the day to day running to Mr Amin.[50]Whilst he delegates the running so that Mr Amin is effectively his agent, we are satisfied that Mr Daly continues to be entitled to receive the rent and so is in control of the Property.[51]Weighing up the evidence we were not satisfied that Mr Daly had a reasonable excuse. He was aware of the licencing regime. As a landlord it is for him to keep himself appraised of changes, particularly given he had specifically chosen to run 68 Ladbroke Road as a house in multiple occupation.[52]We were satisfied beyond reasonable doubt that for the period when the Applicants occupied the Property being from 1st July 2020 until 28th December 2020 the offence of controlling an HMO without a licence pursuant to section 42 of the Housing Act 2004 was being committed.[53]We turn now to the amount of any order. We remind ourselves that the Upper Tribunal has stated that the starting point for any Order is 100% of the rent. Mr Daly gave evidence of the payments received totalling £4530. This evidence was accepted by the Applicants.[54]The Applicants accepted that the costs was inclusive of all bills including a cleaner and WiFi.[55]Mr Daly suggests that costs for damage caused by the Applicants should also be deducted and various invoices are included within the bundle. We do not agree these amounts should be deducted because the deposit was returned in full to the Applicants by Mr Amin when they vacated. Further, in respect of the deposit claim proceedings bought by the Applicants against the Respondent, we are told these were settled having regard to the counterclaim which the Respondent said he would bring for essentially the same sums. Essentially the Respondent has already raised these sums to settle the deposit claim.[56]It was suggested there was bad conduct on the part of the Applicants. We make no findings as to poor conduct on the part of the tenants having considered all of the evidence. We note it cannot be said Mr Amin or Mr Wilding are independent given the links they have with the Respondent.[57]We are satisfied that deductions should be made. However we note that Mr Jones in his description of the property, which was agreed as accurate by Mr Daly, that there were seven bedrooms. In our judgment the calculation should be on a per room basis and so 1/7th of the bills should be deducted. We calculate this on the basis of the Respondents figures on [131 and 132] to be £452.26. On the basis that some bills presented relate to the current year rather than the period of occupation, we have rounded this down to £450.[58]We make no deduction for mortgage costs. No evidence was within the bundle and in any event this is a cost the landlord chooses to incur for the right to own the property.[59]This Tribunal makes a Rent Repayment Order in favour of the Applicants in the sum of £4,080 such sum to be paid by the Respondent to the Applicant within 14 days of the date of this decision.[60]We further Order that the Respondent shall reimburse the Applicant for the Tribunal fees paid of £300 within 14 days of the date of this decision. RIGHTS OF APPEAL[1]A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application by email to rpsouthern@justice.gov.uk to the First-tier Tribunal at the Regional office which has been dealing with the case.[2]The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.[3]If the person wishing to appeal does not comply with the 28 day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then decide whether to extend time or not to allow the application for permission to appeal to proceed.[4]The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.