6 Enfield Road, Crawley, RH11 9NA HAV/45UE/F77/2024/0603

FIRST-TIER TRIBUNAL
PROPERTY CHAMBER (RESIDENTIAL PROPERTY)
Case No HAV/45UE/F77/2024/0603
Between
D & B JagatiaApplicantLondon & QuadrantRespondentMr D & Mrs B JagatiaTenantLondon & QuadrantLandlord
Before
Mr R Waterhouse BSc (Hons) MA LLM FRICSMr MJF Donaldson FRICSDate 26 November 2024Property: 6 Enfield Road, Crawley, West Sussex, RH11 9NA

REASONS

[1]The decision of the Tribunal is that a fair rent of £219.00 per week including £3.90 per week for services is determined with an effective date of 26 November 2024. Background[2]An application was made to re-register a fair rent, dated 15 August 2023 by the landlord of the property London & Quadrant. Prior to the application to re-register a fair rent, the Rent Officer had registered a rent of £155.00 per week, with £7.72 per week attributed to services, with effect from 18 April 2017.[3]Subsequently the Rent Officer registered a fair rent of £230.00 per week, including £3.90 per week for services, with effect from 12 September 2024.[4]In a letter the tenant objected to the rent registered by letter dated 26 September 2024 and the matter was referred to the First –tier Tribunal (Property Chamber) (Residential Property).[5]Directions were issued by the Tribunal on the 11 October 2024. Thereafter, the Directions made provision for the filing with the Tribunal of the parties’ respective written submissions and, in particular, for the completion of a reply form giving details of the Property and including any further comments the parties wished the Tribunal to take into account in making its determination.The tenancy is a statutory (protected) periodic tenancy. The tenancy (not being for a fixed tenancy of 7 years or more) is subject to section 11 of the Landlord and Tenant Act 1985 which sets out the landlords statutory repairing obligations; the tenant is responsible for internal decorations. The Property[6]The property is as described by the Rent Register as a terraced house, with full central heating, on the ground floor two rooms, one kitchen, WC and storeroom. On the first floor there are three rooms, one bathroom with WC and outside a garden. The Inspection[7]The Tribunal did not inspect the property. Relevant Law[8]Provisions in respect of the jurisdiction of the Tribunal and the determination of a fair rent are found in Schedule 11, Part 1, paragraph 9(1) to the Rent Act 1977, as amended by paragraph 34 of the Transfer of Tribunal Functions Order 2013, and section 70 of the Rent Act 1977. Rent Act 1977 Schedule 11, Part 1, paragraph 9 (as amended) “Outcome of determination of fair rent by appropriate tribunal[9](1) The appropriate tribunal shall- (a) if it appears to them that the rent registered or confirmed by the rent officer is a fair rent, confirm that rent; (b) if it does not appear to them that that rent is a fair rent, determine a fair rent for the dwelling house.” Section 70: Determination of fair rent (as amended) “(1) In determining, for the purposes of the Part of this Act, what rent is or would be a fair rent under a regulated tenancy of a dwelling house, regard shall be had to all the circumstances (other than personal circumstances) and in particular to- (a) the age, character, locality and state of repair of the dwelling-house, … (b) if any furniture is provided for the use under the tenancy, the quantity, quality and condition of the furniture [, and (c) any premium, or sum in the nature of a premium, which has been or may be lawfully required or received on the grant, renewal, continuance or assignment of the tenancy.](2) For the purposes of the determination it shall be assumed that the number of persons seeking to become tenants of similar dwelling-houses in locality on the terms (other than those relating to rent) of the regulated tenancy is not substantially greater than the number of such dwelling-houses in the locality which are available for letting on such terms.(3) There shall be disregarded- (a) any disrepair or other defect attributable to a failure by the tenant under the regulated tenancy or any predecessor in title of his to comply with any terms thereof; (b) any improvement carried out, otherwise than in pursuance of the terms of the tenancy, by the tenant under the regulated tenancy or any predecessor in title of his; (c), (d) …[repealed] (e) if any furniture is provided for use under the regulated tenancy, any improvement to the furniture by the tenant under the regulated tenancy or any predecessor of his or, as the case may be, any deterioration in the condition of the furniture due to any ill-treatment by the tenant, any person residing or lodging with him, or any sub-tenant of his.”[9]Consequently, when determining a fair rent the Tribunal, in accordance with the Rent Act 1977, section 70, has regard to all the circumstances including the age, location and state of repair of the Property. It also disregards the effect of(a) any relevant Tenant’s improvements and(b) the effect of any disrepair or defect attributed to the Tenant of any predecessor in title under the regulated tenancy, on the rental value of the Property. In Spath Holme Ltd v Chairman of the Greater Manchester etc. Committee (1995) 28 HLR 107 and Curtis v London Rent Assessment Committee [1999] QB 92 the Court of Appeal emphasised: (a) that ordinarily a fair rent is the market rent for the property discounted for “scarcity” (i.e. that element, if any, of the market rent, that is attributable to there being a significant shortage of similar properties in the wider locality available for letting on terms- other than as to rent- to that of the regulated tenancy) and (b) that for the purposes of determining the market rent, assured tenancy (market rents) are usually appropriate comparables. (The rents may have to be adjusted where necessary to reflect any differences between the comparables and the subject property).[10]In considering scarcity under section 70 (2), the Tribunal recognises that:(a) there are considerable variations in the level of a scarcity in different parts of the country and that there is no general guidance or “rule of thumb” to indicate what adjustments should be made; the Tribunal, therefore, considers the case on its merits;(b) terms relating to rents are to be excluded. A lack of demand at a particular rent is not necessarily evidence of scarcity; it may be evidence that the prospective tenants are not prepared to pay that particular rent. Fair rents are subject to a capping procedure under the Rent Acts (Maximum Fair Rent) Order 1999 which limits increases by a formula based on the proportional increase in the Retail Price Index since last registration. The only exception to this restriction on a fair rent is provided under paragraph 7 of the Order where a landlord carries out repairs or improvements which increase the rent by 15% or more of the previous registered rent. Submissions Landlord[11]The landlord made no submissions other than the initial Application form. Tenant[12]The Tenant submitted a completed Reply Form, which noted, the Landlord supplied the central heating, double glazing and the Tenant supplied carpets, curtains and white goods. The Determination The determination was on papers only with no inspection.[13]The rent to be determined must reflect the condition found on the date of the hearing disregarding all Tenants' improvements.[14]The process for determining a fair rent is a two-stage process. First the application of Rent Act 1977 section 70 (see above) on the subject property and then subject to the maximum rent permitted under the Maximum Fair Rent Order 1999.The lower of the figures being adopted as the Fair Rent.[15]Initially the Tribunal determined what rent the Landlord could reasonably be expected to obtain for the Property in the open market if it were let today in the condition that is considered usual for such an open market letting. Considering evidence submitted and the Tribunal acting in its capacity as an expert Tribunal and using its general knowledge of market levels in the area, concluded that the rent was £335.00 per week if let on a contemporary assured shorthold basis.[16]The Tribunal determined that there should be a deduction of £75.00 per week to reflect the fact the terms and conditions and goods supplied under the tenancy would differ from those of a contemporary Assured Shorthold Tenancy, from which the rental comparables are derived. Thereafter the Tribunal considered the question of scarcity in section 70 (2) of the Rent Act 1977. Looking at the market in the locality the Tribunal determined that scarcity would not be applicable. The calculation[17]The rent prior to adjustment for condition, terms and scarcity, was £335 per week. £335.00 per week Less differing terms £75.00 per week ---------------------- £260.00 per week ----------------------[18]The rent after this final adjustment is £260.00 per week. Rent Acts (Maximum Fair Rent) Order 1999[19]The rent to be registered is limited by the Rent Acts (Maximum Fair Rent Order) 1999. The rent calculated in accordance with the Order is £219.00 per week. This figure is lower than the figure calculated by reference to the market rent with adjustments, of £260.00 per week.[20]Accordingly, the sum of £219.00 per week from 26 November 2024 being the date of the Tribunal’s decision is to be registered. Decision Date: 26 November 2024 Extended reasons: 26 November 2024 Appeal to the Upper Tribunal A person wishing to appeal this decision to the Upper Tribunal (Property Chamber) on a point of law must seek permission to do so by making a written application to the First-tier Tribunal at the Regional Office which has been dealing with the case which application must:a. be received by the said office within 28 days after the Tribunal sends to the person making the application written reasons for the decision.b. 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. If the application is not received within the 28–day time limit, it must include a request for an extension of time and the reason for it 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. --- decision_2.pdf --- 1 Case Reference : HAV/45UE/F77/2024/0603 Property : 6 Enfield Road, Crawley, RH11 9NA Tenant : D & B Jagatia Landlord : London & Quadrant Type of Application : Determination of a Fair Rent under section 70 of the Rent Act 1977 Tribunal : Mr R Waterhouse BSc (Hons) MA LLM FRICS Mr MJF Donaldson FRICS Determination on papers only: No inspection Date of Decision : 26 November 2024 Date of Statement of Reasons: 26 November 2024 _______________________________________________ Statement of Reasons ____________________________________ © CROWN COPYRIGHT 2024 Decision FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) 2[1]The decision of the Tribunal is that a fair rent of £219.00 per week including £3.90 per week for services is determined with an effective date of 26 November 2024. Background[2]An application was made to re-register a fair rent, dated 15 August 2023 by the landlord of the property London & Quadrant. Prior to the application to re- register a fair rent, the Rent Officer had registered a rent of £155.00 per week, with £7.72 per week attributed to services, with effect from 18 April 2017.[3]Subsequently the Rent Officer registered a fair rent of £230.00 per week, including £3.90 per week for services, with effect from 12 September 2024.[4]In a letter the tenant objected to the rent registered by letter dated 26 September 2024 and the matter was referred to the First –tier Tribunal (Property Chamber) (Residential Property).[5]Directions were issued by the Tribunal on the 11 October 2024. Thereafter, the Directions made provision for the filing with the Tribunal of the parties’ respective written submissions and, in particular, for the completion of a reply form giving details of the Property and including any further comments the parties wished the Tribunal to take into account in making its determination.The tenancy is a statutory (protected) periodic tenancy. The tenancy (not being for a fixed tenancy of 7 years or more) is subject to section 11 of the Landlord and Tenant Act 1985 which sets out the landlords statutory repairing obligations; the tenant is responsible for internal decorations. The Property[6]The property is as described by the Rent Register as a terraced house, with full central heating, on the ground floor two rooms, one kitchen, WC and storeroom. On the first floor there are three rooms, one bathroom with WC and outside a garden. The Inspection[7]The Tribunal did not inspect the property. Relevant Law 3[8]Provisions in respect of the jurisdiction of the Tribunal and the determination of a fair rent are found in Schedule 11, Part 1, paragraph 9(1) to the Rent Act 1977, as amended by paragraph 34 of the Transfer of Tribunal Functions Order 2013, and section 70 of the Rent Act 1977. Rent Act 1977 Schedule 11, Part 1, paragraph 9 (as amended) “Outcome of determination of fair rent by appropriate tribunal[9](1) The appropriate tribunal shall- (a) if it appears to them that the rent registered or confirmed by the rent officer is a fair rent, confirm that rent; (b) if it does not appear to them that that rent is a fair rent, determine a fair rent for the dwelling house.” Section 70: Determination of fair rent (as amended) “(1) In determining, for the purposes of the Part of this Act, what rent is or would be a fair rent under a regulated tenancy of a dwelling house, regard shall be had to all the circumstances (other than personal circumstances) and in particular to- (a) the age, character, locality and state of repair of the dwelling-house, … (b) if any furniture is provided for the use under the tenancy, the quantity, quality and condition of the furniture [, and (c) any premium, or sum in the nature of a premium, which has been or may be lawfully required or received on the grant, renewal, continuance or assignment of the tenancy.](2) For the purposes of the determination it shall be assumed that the number of persons seeking to become tenants of similar dwelling-houses in locality on the terms (other than those relating to rent) of the regulated tenancy is not substantially greater than the number of such dwelling-houses in the locality which are available for letting on such terms.(3) There shall be disregarded- 4 (a) any disrepair or other defect attributable to a failure by the tenant under the regulated tenancy or any predecessor in title of his to comply with any terms thereof; (b) any improvement carried out, otherwise than in pursuance of the terms of the tenancy, by the tenant under the regulated tenancy or any predecessor in title of his; (c), (d) …[repealed] (e) if any furniture is provided for use under the regulated tenancy, any improvement to the furniture by the tenant under the regulated tenancy or any predecessor of his or, as the case may be, any deterioration in the condition of the furniture due to any ill-treatment by the tenant, any person residing or lodging with him, or any sub-tenant of his.”[9]Consequently, when determining a fair rent the Tribunal, in accordance with the Rent Act 1977, section 70, has regard to all the circumstances including the age, location and state of repair of the Property. It also disregards the effect of(a) any relevant Tenant’s improvements and(b) the effect of any disrepair or defect attributed to the Tenant of any predecessor in title under the regulated tenancy, on the rental value of the Property. In Spath Holme Ltd v Chairman of the Greater Manchester etc. Committee (1995) 28 HLR 107 and Curtis v London Rent Assessment Committee [1999] QB 92 the Court of Appeal emphasised: (a) that ordinarily a fair rent is the market rent for the property discounted for “scarcity” (i.e. that element, if any, of the market rent, that is attributable to there being a significant shortage of similar properties in the wider locality available for letting on terms- other than as to rent- to that of the regulated tenancy) and (b) that for the purposes of determining the market rent, assured tenancy (market rents) are usually appropriate comparables. (The rents may have to be adjusted where necessary to reflect any differences between the comparables and the subject property).[10]In considering scarcity under section 70 (2), the Tribunal recognises that: 5(a) there are considerable variations in the level of a scarcity in different parts of the country and that there is no general guidance or “rule of thumb” to indicate what adjustments should be made; the Tribunal, therefore, considers the case on its merits;(b) terms relating to rents are to be excluded. A lack of demand at a particular rent is not necessarily evidence of scarcity; it may be evidence that the prospective tenants are not prepared to pay that particular rent. Fair rents are subject to a capping procedure under the Rent Acts (Maximum Fair Rent) Order 1999 which limits increases by a formula based on the proportional increase in the Retail Price Index since last registration. The only exception to this restriction on a fair rent is provided under paragraph 7 of the Order where a landlord carries out repairs or improvements which increase the rent by 15% or more of the previous registered rent. Submissions Landlord[11]The landlord made no submissions other than the initial Application form. Tenant[12]The Tenant submitted a completed Reply Form, which noted, the Landlord supplied the central heating, double glazing and the Tenant supplied carpets, curtains and white goods. The Determination The determination was on papers only with no inspection.[13]The rent to be determined must reflect the condition found on the date of the hearing disregarding all Tenants' improvements.[14]The process for determining a fair rent is a two-stage process. First the application of Rent Act 1977 section 70 (see above) on the subject property and then subject to the maximum rent permitted under the Maximum Fair Rent Order 1999.The lower of the figures being adopted as the Fair Rent. 6[15]Initially the Tribunal determined what rent the Landlord could reasonably be expected to obtain for the Property in the open market if it were let today in the condition that is considered usual for such an open market letting. Considering evidence submitted and the Tribunal acting in its capacity as an expert Tribunal and using its general knowledge of market levels in the area, concluded that the rent was £335.00 per week if let on a contemporary assured shorthold basis.[16]The Tribunal determined that there should be a deduction of £75.00 per week to reflect the fact the terms and conditions and goods supplied under the tenancy would differ from those of a contemporary Assured Shorthold Tenancy, from which the rental comparables are derived. Thereafter the Tribunal considered the question of scarcity in section 70 (2) of the Rent Act 1977. Looking at the market in the locality the Tribunal determined that scarcity would not be applicable. The calculation[17]The rent prior to adjustment for condition, terms and scarcity, was £335 per week. £335.00 per week Less differing terms £75.00 per week ---------------------- £260.00 per week ----------------------[18]The rent after this final adjustment is £260.00 per week. Rent Acts (Maximum Fair Rent) Order 1999[19]The rent to be registered is limited by the Rent Acts (Maximum Fair Rent Order) 1999. The rent calculated in accordance with the Order is £219.00 per week. This figure is lower than the figure calculated by reference to the market rent with adjustments, of £260.00 per week.[20]Accordingly, the sum of £219.00 per week from 26 November 2024 being the date of the Tribunal’s decision is to be registered. Decision Date: 26 November 2024 7 Extended reasons: 26 November 2024 Appeal to the Upper Tribunal A person wishing to appeal this decision to the Upper Tribunal (Property Chamber) on a point of law must seek permission to do so by making a written application to the First-tier Tribunal at the Regional Office which has been dealing with the case which application must:a. be received by the said office within 28 days after the Tribunal sends to the person making the application written reasons for the decision.b. 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. If the application is not received within the 28–day time limit, it must include a request for an extension of time and the reason for it 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.