16, Saxon Street, Manchester M40 7BY MAN/00BN/HNA/2021/0015
REASONS
[34]“Relevant housing offence”: the Tribunal was satisfied beyond reasonable doubt that the Applicant’s failure to comply with the Improvement Notice was conduct amounting to an offence under s30 of the Act, which constituted a “relevant housing offence” for the purposes of s249A of the Act, permitting the imposition of a financial penalty.[35]Procedural requirements: the Tribunal was satisfied that, in respect of the Notice of Intent and the Final Notice, the Respondent had complied with the following procedural requirements as required under Schedule 13A to the Act:(1) the offence under s30 of the Act was continuing as at the date of the Notice of Intent, namely, 16 March 2020;(2) the Notice of Intent and the Final Notice contained the information as required under paragraphs 3 and 8 of Schedule 13A to the Act; and,(3) the Notice of Intent contained information about the right to make representations.[36]Financial hardship/financial circumstances: the Tribunal made the following findings:(1) Mr. Mbachu had not provided any documentary evidence of his financial circumstances and/or of any financial hardship;(2) it was not persuaded that Mr.Mbachu’s concern that information about his financial affairs would be disclosed to 3rd parties was a reasonable justification for withholding information from the Respondent at the PACE interview or subsequently regarding the rental income from the Property.(3) at the PACE interview, Mr. Mbachu had referred to financial constraints as a reason for the delay in undertaking the remedial works;(4) in view of Mr. Mbachu’s oral evidence that the sale of the Property was in November 2020 and the purchase of a further rental property in Liverpool had only completed recently, it was possible that the significant cash deposit of £320,354 identified in the Experian search carried out by the Respondent in April 2021 may have been related to the sale proceeds of the Property;(5) Mr. Mbachu’s oral evidence at the hearing regarding the amount and subsequent application of the sale proceeds of the Property was confusing and lacked transparency. Specifically, the Tribunal was unable to reconcile the cash balance of £320,354 with Mr. Mbachu’s oral evidence regarding the amount and/or disbursement of those sale proceeds;(6) there was no evidence that Mr. Mbachu was suffering financial hardship that would have prevented him from undertaking the works required under the Improvement Notice or that should have been taken into account in determining the amount of the financial penalty;(7) the limited evidence that was available suggested that Mr. Mbachu had cash assets available at the date of the Final Notice sufficient to pay the financial penalty, and that, at the date of this determination, he has substantial property assets, one of which is mortgage-free.[37]Text messages: the Tribunal made the following findings:(1) the images appear to be of WhatsApp messages;(2) the messages of 21 and 28 January 2020 evidence that discussions did take place between Mr. Mbashu and the Respondent following the 2nd inspection;(3) whilst in the message of 28 January 2020, Mr.Mbachu says that he has placed orders for a new window and door, his subsequent written and oral evidence appears to contradict this. Specifically, Mr. Mbachu stated that the glass in the window was not replaced until May 2020, and that the remedial works to the patio door were never undertaken;(4) it is satisfied that Mr.Mbachu wrote a message on 8 June 2020 informing the Respondent that he had done works to the window, the kitchen cupboards and the TV socket;(5) successful transmission of a WhatsApp message is indicated by 2 grey ticks at the end of the message; these ticks turn blue when the message has been read. The one grey tick at the end of this message dated 8 June 2020 indicates that it was not successfully sent, although the Tribunal is satisfied that Mr. Mbachu intended that it should have been;(6) the Tribunal is therefore satisfied that the Respondent was not notified of the completion of some of the remedial works by this message and could not therefore have taken this into account as a mitigating factor prior to the issue of the Final Notice.[38]Completion of the works/further inspection: the Tribunal made the following findings:(1) there is no evidence of any communication from Mr. Mbachu to the Respondent following up on his message of 8 June 2020 (which it is presumed Mr. Mbachu believed had been sent);(2) there is no evidence that Mr.Mbachu provided the Respondent with any photographic evidence of the works said to have been undertaken in May 2020;(3) the obligation was on Mr. Mbachu to persuade the Respondent that there was a reason to re-inspect the Property;(4) there is no evidence that the remedial works said to have been undertaken in May 2020 were done in compliance with the Improvement Notice;(5) there is no evidence that the remedial works to the patio door or the re-location of the electrical sockets in the kitchen were undertaken.[39]Determination of the financial penalty/application of the Policy: the Tribunal made the following findings:(1) it agreed with the Respondent’s categorisation of the harm as “low”;(2) the Tribunal considered that the categorisation of culpability in accordance with the Policy should be “medium” rather than “high”, where “high” culpability refers to “serious or systemic failings, actual foresight or wilful blindness to risk of offending”, and “medium” culpability refers to “failure…to take reasonable care to put in place and enforce proper systems for avoiding commission of the offence” and, by way of example, “part compliance with a schedule of works, but failure to fully complete all schedule items within notice timescale”. The Tribunal noted as follows: (i) there was no evidence before the Tribunal of any “serious or systemic failings” on Mr.Mbachu’s part, nor of “actual foresight…to risk of offending”; (ii) the Respondent referred to Mr. Mbachu’s failure to engage with it in relation to the Improvement Notice. The Tribunal considered that there is evidence of engagement (albeit late and limited) by Mr. Mbachu with the Respondent including, without limitation, the telephone call and WhatApp messages in January 2020 following the inspection on 17 January 2020 (which also suggested some prior communication between the parties) and his attendance at the PACE interview; (iii) the Tribunal accepted the WhatsApp message of 8 June 2020 as evidence that Mr. Mbachu had undertaken some of the remedial works as required under the Improvement Notice; (iv) taken together, the Tribunal considered that the evidence of Mr.Mbachu’s conduct in paragraphs (ii) and (iii) did not support a determination of “wilful blindness” but was more indicative of a “failure to take reasonable care”;(3) on balance, the Tribunal therefore determined that a categorisation of “medium” culpability was more apposite to the circumstances in this case.(4) Having regard to the Tribunal’s determination in paragraph (3) above, in accordance with the Policy, the relevant financial penalty banding for low harm/medium culpability is Band 2, where the range is from £5000 – 9999 with a starting point of £7500.(5) The Tribunal noted that the financial penalty should be set at an appropriate level in order to ensure that it reflects the factors set out in paragraph 4 of the Policy, including, without limitation, removing any financial benefit obtained from committing the offence.(6) The Tribunal noted that Mr. Mbachu had continued to receive rental income from the Property of c£1000 per month throughout the period of commission of the offence until the sale of the Property in or about November 2020, a period of 12 months.(7) The Tribunal determined that the starting point of £7500 was not an appropriate level to reflect the financial benefit obtained by Mr. Mbachu.(8) Further, the Tribunal had regard to paragraph 5.4 of the Policy which provides that the local authority may increase or reduce the financial penalty within the relevant banding where they “…are satisfied that the assets and income (not just the rental income) of the offender are such that it is just and appropriate” to do so.(9) The Tribunal was satisfied that it was appropriate to take into account Mr. Mbachu’s assets and income, including the following: (i) the rental income from the Property during the period of the commission of the relevant housing offence until its sale in or about November 2020; (ii) the mortgage-free property in Liverpool and the anticipated rental income from that property; (iii) Mr.Mbachu’s property in London; and, (iv) Mr. Mbachu’s failure to fully account for the application of the sale proceeds of the Property.(10) Having regard to the evidence of his assets and income as disclosed by Mr. Mbachu to the Tribunal, the Tribunal determined that it was just and appropriate to increase the financial penalty to the maximum amount of Band 2, namely, £9999.(11) In accordance with paragraph 10(4) of Schedule 13 to the Act, the Tribunal varied the Final Notice by reducing the amount of the financial penalty from £12500 to £9999. C Wood Tribunal Judge 3 August 2021