MR KISHORE KANSAL v LONDON BOROUGH OF LAMBETH [2020] UKUT 365 (LC)

UPPER TRIBUNAL

LANDS CHAMBER

[2020] UKUT 365 (LC)

Case No HA/15/2020

Between

MR KISHORE KANSALApplicant

LONDON BOROUGH OF LAMBETHRespondent

Before

Judge Elizabeth Cooke

Mr Nick Ham for Respondent

Property: 56 Crewdson Road,, London,, SW9 OLJ, Judge Elizabeth Cooke

Catchwords: HOUSING – HOUSE IN MULTIPLE OCCUPATION – variation of licence – notice of variation containing incorrect date – consequences of mistakes in notices AN APPEAL AGAINST A DECISION OF THE FIRST TIER TRIBUNAL (PROPERTY CHAMBER)

[1]This appeal is about the consequences of a mistake in a notice, given by a local authority, whose contents are prescribed by a statute.

[2]On 16 December 2019 the appellant, Mr Kishore Kansal, received a notice from the respondent local authority varying his licence in respect of a house in multiple occupation (“HMO”). He appealed the variation to the First-tier Tribunal (“the FTT”); one of his grounds for the appeal was that the notice said that the respondent had decided to vary the licence on 13 November 2019 when in fact it had made that decision on 16 December 2019. The FTT made a decision on the preliminary issue as to whether that error invalidated the notice and decided that it did not. The appellant appeals that decision.

[3]The Tribunal directed that the appeal would be a review of the FTT’s decision, determined on the basis of written representations. The appellant has not been legally represented, but his written representations show an extensive familiarity with the relevant case law. Mr Nick Ham of counsel has drafted written representations for the local authority. I am grateful to them both. The factual and legal background

[4]The Housing Act 2004 (“the 2004 Act”) created a regime for the licensing of houses in multiple occupation (“HMOs”). It is an offence to manage or be in control of an HMO that is required to be licensed and is not licensed (section 72 of the 2004 Act).

[5]The appellant holds an HMO licence in respect of 56 Crewsdon Road, London SW9; that is pretty much the only factual background the Tribunal has in this appeal, and that is all that is needed.

[6]Paragraph 16 of Schedule 5 to the 2004 Act provides as follows:

“(1) This paragraph applies where the local housing authority decide to vary a licence. (2) The local housing authority must serve on the licence holder and each relevant person– (a) a copy of the authority's decision to vary the licence, and (b) a notice setting out– (i) the reasons for the decision and the date on which it was made, (ii) the right of appeal against the decision under Part 3 of this Schedule, and (iii) the period within which an appeal may be made (see paragraph 33(2)). 4 (3) The documents required to be served under sub-paragraph (2) must be served within the period of seven days beginning with the day on which the decision is made.”

[7]In the present appeal the respondent local authority decided on 16 December 2016 to vary the appellant’s licence. On that same date it sent a letter to the appellant which, as the FTT put it, purported to vary his licence. But the notice sent pursuant to paragraph 16(2), set out above, stated that the decision to do so was taken on 13 November 2019 which, as the respondent conceded before the FTT, was incorrect.

[8]Paragraph 32 of Schedule 5 to the 2004 Act enables a licence holder to appeal to the FTT a decision to vary a licence. The appellant did so, and argued before the FTT that because the statute says that the notice “must” set out the date on which it was made, and this notice did not, it was invalid. He quoted Lord Woolf MR in R v Secretary of State for the Home Department ex parte Jeyeanthan

[1999] EWCA Civ 3010

who said “the requirement is never intended to be optional if a word such as “shall” or “must” is used.” The FTT disagreed. It accepted the respondent’s argument, which also rested upon Jeyeanthan. that this was an error that did not invalidate the notice. The requirement must be complied with, but the consequence of non-compliance is not necessarily the invalidity of the notice and in this case it was not.

[9]The Tribunal gave permission to appeal on the basis that the issue was suitable for determination by the Tribunal. The appellant has misconstrued the Court of Appeal’s decision in Jeyeanthan; he has also relied upon Natt v Osman

[2014] EWCA Civ 1520

and upon Elim Court RTM Company Limited v Avon Freeholds Limited

[2017] EWCA Civ 89

, and I hope that it will be helpful to explain how those decisions fit together. The decisions in Jeyeanthan, Natt v Osman and Elim Court

[10]In Jeyeanthan the Court of Appeal had to consider what was the consequence of the Secretary of State’s failure to use the prescribed form when appealing an immigration decision of the Special Adjudicator to the Immigration Appeal Tribunal.

[11]The Court of Appeal’s decision was important because it made clear that the traditional approach to procedural requirements, namely to decide whether they were “directory” or “mandatory”, was not correct. Lord Woolf MR explained that where a requirement framed by the words “must” or “shall” Parliament expected it to be precisely complied with; hence the words quoted by the appellant from paragraph 8 of the decision, which I repeat:

“the requirement is never intended to be optional if a word such as “shall” or “must” is used.”

But the appellant in relying on those words failed to go on to what the Master of the Rolls said next. He went on to say that nevertheless, where such a requirement has not been complied with the court or tribunal must decide what Parliament intended to be the consequences of non-compliance:

“the tribunal before whom the defect is properly raised has the task of determining what are to be the consequences of failing to comply with the requirement in the context of all the facts and circumstances of the case in which the issue arises. In 5 such a situation that tribunal’s task will be to seek to do what is just in all the circumstances.”

[12]That outcome of that task might be the invalidity of the notice or other document; or there might be a less dramatic consequence, as indeed there was in Jeyeanthan itself where the notice was found to be valid despite not being on the correct form.

[13]The appellant has argued that what Lord Woolf MR meant was that failure to meet a requirement prefaced by “must” or “shall” would invalidate a notice unless that outcome would be unjust. That is not what Lord Woolf MR said, nor what he meant – as we can see from the further decisions upon which the appellant relies.

[14]In Natt v Osman the Court of Appeal looked at how the court or tribunal is to determine whether there has been a failure to comply with a requirement. If there has been no failure then there is no need to determine the consequences of failure. Etherton C at paragraph 28 and following distinguished(1) cases involving a challenge to a decision of a public body, or concerning a procedural requirement for challenging a decision by litigation or some other process and

(2) cases where there is said to be a failure to comply with a statutory requirement in a process for the acquisition of a private property right. In the latter case, substantial compliance will not be sufficient; the strict requirements of the statute must be complied with. In the former case, substantial compliance may be sufficient.

[15]I agree with the appellant that even though this case concerns a challenge to a public authority’s decision rather than the acquisition of a private property right, so that substantial compliance may be sufficient, there was simply no compliance with the requirement to provide the date on which the decision was taken. But that is not the end of the matter. The requirement was not complied with; as the Court of Appeal in Jeyeanthan and in Natt v Osman made clear, it is still necessary to decide what are the consequences of non- compliance.

[16]The appellant further relies upon the Court of Appeal’s decision in Elim Court, which related to the acquisition of the right to manage a block of flats. The Upper Tribunal had decided that the RTM Company had not acquired the right to manage because of defects in its claim notice. The Court of Appeal referred to Natt v Osman and agreed that this was a case where substantial compliance was not compliance because the case fell into the second of Etherton C’s categories in Natt v Osman, relating to the acquisition of private rights. So there had been no compliance, but it remained to determine the consequences of non-compliance; and in that case, again, the Court of Appeal determined that non-compliance did not invalidate the notice.

[17]The appellant argues that in failing to find the notice invalid the FTT misconstrued the law, disregarded the will of Parliament, ignored the plain word “must” in the statute, took upon itself a discretion that it did not have and made a decision that was ultra vires. He seeks in effect to insist that the word “must” denotes a requirement with mandatory effect but, as we have seen, that is not the correct approach. In fact the FTT in deciding what would be just in all the circumstances did exactly as the Court of Appeal required in Jeyeanthan. 6 Applying the law stated in Jeyeanthan in this case

[18]The FTT correctly stated, and clearly understood, the law as set out in Jeyeanthan. It took the view, following Natt v Osman, that there had been substantial compliance with the requirement to state the date of the decision because the respondent stated the date, but got it wrong. I disagree with the FTT on that point; there was an attempt at compliance, but there cannot be said to have been substantial compliance. However, the FTT nevertheless undertook the task prescribed by the Court of Appeal in Jeyeanthan (and reiterated in Natt v Osman and in Elim Court), and asked what should be the consequences of non-compliance. So the FTT’s view about substantial compliance did not prevent it from taking the correct course.

[19]At its paragraph 25 the FTT pointed out that the appellant was not misled by the mistake in the notice, let alone prejudiced by it in any way, He had proceeded to appeal the variation of the licence despite the error. In Lord Woolf’s words it would clearly be “just in all the circumstances” to treat the notice as valid so that the FTT could go on to consider the appellant’s appeal of the variation.

[20]I agree with the FTT’s reasoning and uphold its decision. The appeal fails. Judge Elizabeth Cooke 18 December 2020