KARTAL CETIN v EPPING FOREST DISTRICT COUNCIL 90 Borders Lane, Loughton, Essex IG10 3QX [2025] UKUT 196 (LC)

UPPER TRIBUNAL
LANDS CHAMBER
[2025] UKUT 196 (LC)Case No LC-2025-31
Between
KARTAL CETINApplicantEPPING FOREST DISTRICT COUNCIL 90 Borders Lane, Loughton, Essex IG10 3QXRespondent
Before
Martin Rodger KCNiamh O’Brien (instructed by The Head of Legal Services, Epping Forest District Council) for RespondentDate 23 June 2025Catchwords: HOUSING – CIVIL PENALTY – unlicensed HMO – letting agent acting on a “let only” basis – tenant paying deposit and first month’s rent to agent before moving in – whether letting agent a “person managing” the HMO – s. 263(3), Housing Act 2004 – appeal allowed

Introduction

[1]Is a residential letting agent who is instructed on a “let only” basis to let a room in an HMO, and who has no further involvement with the property after receiving a single instalment of rent on the day of the letting, a “person managing” the HMO within the meaning of section 263(3) of the Housing Act 2004, so as to be subject to statutory duties in relation to HMO licensing and management and to be exposed to the risk of criminal or civil sanctions in the event of a breach of those duties?[2]That question arises in this appeal from a decision of the First-tier Tribunal, Property Chamber (FTT) by a director of a residential letting agency on whom a financial penalty was imposed by a local housing authority under section 249A of the Housing Act 2004 in respect of the agency’s alleged involvement in the control or management of an unlicensed HMO contrary to section 72(1) of the Act.[3]The appellant, Mr Kartal Cetin, is a director of Discover Residential Ltd (the Company), a letting agency in Essex. By a final notice served on him by the respondent, Epping Forest District Council, on 20 April 2023, Mr Cetin was personally made subject to a financial penalty of £7,064.32 after the Company had let rooms in an HMO at 90 Borders Lane, Loughton to two tenants.[4]Mr Cetin appealed against the financial penalty to the FTT, but it was satisfied that he had committed the relevant housing offence. It took a different view of the appropriate punishment from the Council and reduced the penalty to £3,532.16.[5]Mr Cetin now appeals with the permission of this Tribunal against the FTT’s finding that he had committed the offence of being a person having control of or managing an unlicensed HMO.[6]Mr Cetin notified the Tribunal on the afternoon before the hearing of his appeal that he would be unable to attend because of an unspecified “family emergency” and requested an adjournment. As this request was not supported by any proper explanation of the suggested emergency I refused it. Mr Cetin did not attend the hearing, but I was satisfied having regard to the issue in the appeal that it was in the interests of justice for the appeal to proceed in his absence. A colleague of Mr Cetin’s, Mr Gurkan Oba, did attend the hearing. I permitted him to make a statement on behalf of Mr Cetin which, in the event, contained nothing inconsistent with the FTT’s findings of fact. The respondent local housing authority was represented by Niamh O’Brien.

The relevant statutory provisions

[7]Part 2 of the Housing Act 2004 (the Act) introduced a new statutory scheme for licensing houses in multiple occupation (HMOs). Statutory control of HMOs was introduced in the Housing Act 1957 which gave local housing authorities powers of oversight which were subsequently extended and eventually consolidated in Part XI of the Housing Act 1985. That scheme was entirely replaced by Part 2 of the Act which makes provision for HMO licensing. Part 2 is supplemented by provisions in Part 7 of the Act which confer powers on the Secretary of State to approve codes of practice and to make regulations concerning the management of HMOs. Under the Act, licensing and regulation are complementary responses to poor housing conditions.[8]By section 55(2)(a) of the Act, Part 2 applies to any HMO in a local housing authority’s district which falls within a prescribed description. In England, an HMO which meets the “standard test” in section 254(2) of the Act is within a prescribed description if it is occupied by five or more persons living in two or more separate households (article 4, Licensing of Houses in Multiple Occupation (Prescribed Description) (England) Order 2018).[9]The property in this case was an HMO because it met the “standard test” in section 254(2). In summary, it comprised a number of individual rooms which were not self- contained flats and whose only use was as living accommodation, which were occupied by individuals who did not form a single household, each occupying an individual room as their only or main residence, paying rent and sharing basic amenities.[10]Dealing first with licensing, section 55(5) imposes general duties on every local housing authority in relation to licensing. These include, by section 55(5)(c) and (6) a duty on the authority to satisfy themselves, by inspection or otherwise, that the condition of premises in respect of which a licence has been applied for is not such as to give rise to a hazard engaging the authority’s duties and powers under Part 1 of the Act, which is concerned with the enforcement of housing standards.[11]By section 61(1) of the Act, and subject to certain exemptions that do not apply in this case, any HMO to which Part 2 applies is required to be licensed. Unless it is exempt, every HMO which meets the standard test and which is occupied by more than five persons living in two or more separate households is therefore required to be licensed.[12]Section 64 of the Act makes provision for the grant or refusal of HMO licences by local housing authorities. By section 64(3), the matters of which an authority must be satisfied before they may grant a licence include:
“(3) … (b) that the proposed licence holder- (i) is a fit and proper person to be the licence holder, and (ii) is, out of all the persons reasonably available to be the licence holder in respect of the house, the most appropriate person to be the licence holder; (c) that the proposed manager of the house is either- (i) the person having control of the house, or (ii) a person who is an agent or employee of the person having control of the house; (d) that the proposed manager of the house is a fit and proper person to be the manager of the house; and (e) that the proposed management arrangements for the house are otherwise satisfactory.”
[13]The object of licensing is indicated by the general duties in section 55(5) and by the considerations relevant to the grant of licences in section 64(3) all of which relate to the condition and standard of management of the premises.[14]By section 72(1) of the Act a person commits an offence if they are “a person having control of or managing an HMO which is required to be licensed under this Part (see section 61(1)) but is not so licensed.”[15]Section 234 of the Act authorises the making of regulations for the purpose of ensuring the satisfactory management of HMOs. Like licensing, regulation under the Act is concerned with the maintenance of housing standards as regards the physical condition of HMOs and standards of management. Regulations made under section 234 may in particular impose duties on “the person managing” an HMO in respect of repair, maintenance, cleanliness and good order, and the facilities and equipment in it. A person commits an offence if they fail to comply with regulations made under the section.[16]The Management of Houses in Multiple Occupation (England) Regulations 2006 (“the Management Regulations”) were made under the power in section 234. They apply (by regulation 1) to any HMO in England (other than a section 257 HMO) and are therefore of wider application than the licensing regime which touches only those HMOs to which Part 2 applies. Extensive duties are imposed by the Management Regulations on “the manager” in relation to safety measures, utility supplies, maintenance of common parts and living accommodation and waste disposal. By regulation 3 the manager must ensure that their name and contact details are made available to each household in the HMO and are clearly displayed in a prominent position in the HMO.[17]The person who bears these responsibilities is “the manager”, an expression defined (with an accompanying footnote) in regulation 2(c) of the Management Regulations as follows:
“2(c) “the manager”, in relation to an HMO, means the person managing1 the HMO. 1 For the meaning of “person managing” see section 263(3) of the Act.”
[18]The term “person managing” used in sections 72(1) and 234 of the Act and in the definition of “manager” in the Management Regulations is defined in section 263(3) of the Act as follows:
“263. Meaning of “person having control” and “person managing” etc … (3) In this Act “person managing” means, in relation to premises, the person who, being an owner or lessee of the premises – (a) receives (whether directly or through an agent or trustee) rents or other payments from – (i) in the case of a house in multiple occupation, persons who are in occupation as tenants or licensees of parts of the premises; and (ii) in the case of a house to which Part 3 applies (see section 79(2)), persons who are in occupation as tenants or licensees of parts of the premises, or of the whole of the premises; or (b) would so receive those rents or other payments but for having entered into an arrangement (whether in pursuance of a court order or otherwise) with another person who is not an owner or lessee of the premises by virtue of which that other person receives the rents or other payments; and includes, where those rents or other payments are received through another person as agent or trustee, that other person.”
[19]Section 249A of the Act permits a local housing authority to impose a financial penalty on a person if it is satisfied beyond reasonable doubt that they have committed a relevant housing offence. Relevant housing offences include the offence under section 72 of managing or controlling an unlicensed HMO.[20]By section 252(1), where an offence under the Act committed by a company is proved to have been committed “with the consent or connivance of, or to be attributable to any neglect on the part of” a director, the director will also commit the offence and will be liable to be proceeded against and punished accordingly.[21]I mention also that letting agents are subject to separate consumer protection laws and that Part 2 of the Housing and Planning Act 2016 makes “rogue property agents” liable to banning orders prohibiting them from engaging in letting agency work if they committed a “banning order offence”. These offences are listed in the Schedule to The Housing and Planning Act 2016 (Banning Order Offences) Regulations 2018 and include the offences in relation to HMOs created by section 72 of the 2004 Act.

The material facts

[22]90 Borders Lane is a flat above a shop. In October 2021 the two individuals who ran the shop and let the flat asked Mr Cetin to arrange lettings of two vacant rooms in the flat on a ‘let only’ basis. On both occasions the negotiator was Mr Oba, an employee of the Company. The flat contains five rooms and after the second of the two lettings arranged by the Company there were five occupants.[23]The two tenants whom the Company placed in the flat each paid a holding deposit and a month’s rent in advance to the Company. Mr Cetin confirmed that he had received those payments as agent for the landlords whom he had charged £250.00 commission in respect of each letting.[24]The FTT found that the property was being used as a licensable HMO and that it was not licensed. If Mr Cetin did not know that it was being so let the FTT considered that as an experienced and qualified agent he ought to have been alert to that possibility and should have made proper enquiries of the landlords and Mr Oba. Mr Oba did know that the property was being operated as an HMO and his knowledge was to be imputed to the Company. The FTT was satisfied that the offences of the Company were committed with the consent or connivance or are attributable to the neglect of Mr Cetin.[25]A financial penalty was imposed by the Council on Mr Cetin for the offence of being a person having control of or managing an HMO which was required to be licensed but was not so licensed, contrary to section 72 of the Housing Act 2004. The offence was said to have been committed between 11th October 2021 and 10th February 2022 and between 17th February 2022 and 6th April 2022.[26]In addition to the penalty imposed on Mr Cetin, the Council imposed financial penalties in respect of the same offence on each of the landlords which they accepted and paid.

The FTT’s decision

[27]The FTT considered that the appeal turned on the concluding part of s. 263(3) (i.e. that “person managing … includes, where those rents or other payments are received through another person as agent or trustee, that other person”). Mr Cetin did not dispute that he received payments of rent on behalf of the landlords in respect of the letting of the property and the FTT was satisfied that Mr Oba knew, and that Mr Cetin either knew or ought to have known, that the property was being used as an HMO and was not licensed. The FTT therefore found that Mr Cetin had committed the offence under section 72(1) of the Act. Having regard to the modest fee of only £500 received by the Company, the FTT considered that the penalty imposed on Mr Cetin by the Council was excessive and reduced it by half.

The appeal

[28]The basis of Mr Cetin’s appeal was that, as a letting agent engaged on “let only” terms (as the FTT accepted) he was not a person managing the property and so could not be liable for the offence under section 72. In granting permission to appeal the Tribunal (Judge Cooke) said there was a realistic prospect of a successful appeal on the basis that Mr Cetin did not come within the description in section 263(3) of “person managing” : either because he received one payment of rent only from each tenant or because the payment he did receive was made at the start of the tenancy and in advance and there was no finding that the tenants were in occupation at that time.[29]The FTT was satisfied that an offence had been committed under section 72 but it made no finding as to the date or duration of the offence. It will assist in considering the question of law which arises on the appeal if I begin by identifying the specific facts disclosed by the evidence and found by the FTT which were capable (subject to that question of law) of constituting a criminal offence.[30]The penalty notice alleged that Mr Cetin committed the offence of being a person in control of or managing an unlicensed HMO “between 11th October 2021 and 10th February 2022 and between 17th February 2022 and 6th April 2022” (the break for one week in February was when the number of tenants briefly fell below five).[31]I suspect the details of the offence were framed in that way because penalties were also being imposed on the landlords who received rent throughout the specified period. But the notice of intent provided a fuller description of the facts alleged to constitute the offence and alleged only that the Company had received holding deposits and rental payments from two tenants, the second of whom, Ms Weir-Clarke, moved in on 11th October at which point the flat became a licensable HMO.[32]Ms Weir-Clarke’s witness statement was unclear on the precise sequence of events. She said that she paid the deposit to the Company by bank transfer on 11th October, but her bank statement shows that sum leaving her account on 9th October. She said that she paid the first month’s rent on 12th October and that she lived at the flat from that date.[33]The important point is that only four people were living in the flat until Ms Weir-Clarke moved in. That was confirmed by Mr Spinks, the first of the two tenants found by the Company, who had moved in on 2nd October and who said he was shown two empty rooms. Although the flat was an HMO, until Ms Weir-Clarke moved in it was not an HMO which required to be licensed, because there were only four people living there. It follows that neither the receipt of payments from Mr Spinks nor the receipt of a holding deposit from Ms Weir-Clarke involved the commission of any offence. The earliest date on which an offence might have been committed was when Ms Weir-Clarke paid the first instalment of rent for her room on 12th October 2021.[34]It is not clear on the evidence whether the payment of rent on 12th October was made before or after Ms Weir-Clarke received keys for the flat or moved in. There was no written tenancy agreement and the letting itself is therefore likely to have commenced at the time the first rent instalment was paid. That would be the normal expectation and it is consistent with a receipt given for the holding deposit which stated that the rent of £480 was to be paid on or before taking the keys.[35]When permission to appeal was granted, the Tribunal suggested that the precise sequence of events might be significant (because there was no finding by the FTT that the tenants were in occupation at the time the first instalment of rent was received by the Company). On behalf of the Council Ms O’Brien objected to that point being taken on appeal as she said it had not been taken by Mr Cetin before the FTT. I do not think that complaint carries much weight in a case like this in which it was for the Council to prove all elements of the offence to the criminal standard.[36]In any event, as I will explain, I do not think that the precise sequence of events is critical. The evidence is that the first instalment of rent was received by the Company, as agent for the landlords, on the day the tenancy commenced. I am content to proceed on the basis that those facts are not inconsistent with the FTT’s finding that an offence had been committed.[37]The more fundamental question is the question posed at the start of this decision, namely, whether an agent who is instructed on a “let only” basis, can be a “person managing” an HMO within the meaning of section 263(3) of the Act. Mr Cetin’s response to the suggestion that he had committed an offence has, from the beginning, been that the Company had never managed the property and was engaged only to let it. It was the evidence of Ms Black, the Environmental Health Officer who had investigated the alleged offence and who represented the Council at the hearing, that she had taken advice from the Council’s legal department whether a “let-only” arrangement could give rise to the status of “person managing” under section 263. The Council has been live to the point from the beginning. It was the basis on which Mr Cetin asked for permission to appeal, and the broad proposition falls within the scope of the permission given by the Tribunal.[38]Neither Mr Cetin nor Mr Oba made submissions on the law. On behalf of the Council Ms O’Brien argued that a strictly literal approach to the construction of section 263(3) was required and that an agent who receives a single instalment of rent or other payment from a tenant in occupation of an HMO on behalf of an owner or lessee of the premises commits an offence. On the basis of that literal construction she suggested that there was force in the proposition that if the person making the payment was not yet “in occupation” as a tenant or licensee when they handed over the money, the recipient would not become a “person managing” by virtue of receiving the payment. She suggested that because the sequence of events had not been investigated at the hearing, no point which depended on it could be taken on an appeal, or alternatively that the matter should be remitted to the FTT for it to make additional findings of fact.

Discussion and conclusion

[39]I am not attracted to an over-literal construction of section 263(3). The importance of the definition of “person managing” is not that it identifies an event or a transaction but that it describes a status to which certain responsibilities are attached, including responsibility for licensing, where it is required, and responsibility for compliance with the Management Regulations. It is true that that status will be acquired at a particular time but it does not seem to me to be helpful in deciding whether an individual does or does not have that status to focus on the precise instant at which it begins. To do so would be to pay too little attention to the context and would risk creating distinctions which cannot have been intended.[40]To take the case of a landlord rather than an agent, a landlord receiving rent from a tenant in occupation of an HMO is a person managing within the definition in section 263(3). It cannot have been intended that the acquisition of that status and the responsibilities which go with it should depend on the precise timing of the first payment of rent. A landlord who receives a deposit and an instalment of rent on the execution of a tenancy agreement before the new tenant has moved in must surely be a person managing the property during the whole of the first month of the tenancy. It would be inconsistent with the object of the legislation, which is the improvement of housing standards for the protection of tenants, for a payment made before the commencement of occupation to be disregarded with the result that the landlord’s statutory responsibilities only commence when a second instalment of rent is received, by which time the tenant has begun to occupy.[41]It is a general principle of interpretation that a construction that produces an absurd result is unlikely to have been intended by Parliament. The application of that principle was considered by the Administrative Court in the recent case of Clearsprings Ready Homes Ltd, R (On the Application Of) v Swindon Magistrates' Court [2024] EWHC 2023 (Admin) which raised a different question about the construction of section 263 and the Management Regulations, namely, whether they apply where the occupants of an HMO have been placed there by a local authority under statutory obligations and pay no rent but where payment is made under a statutory scheme by the Home Office. Warby LJ and Dove J referred to the following application of the presumption, at [28]:
“An example provided in support of the principle is R v Lehair [2015] EWCA Crim 1324, [2015] 1 WLR 4811, a case which concerned section 77(5) of the Proceeds of Crime Act 2002 relating to tainted gifts. The provision defined tainted gifts as gifts which were made at any time after "the date on which the offence was committed". The appellant had robbed a bank at 14.37 on the day in question and then at 16.15 the same day she gifted a portion of the proceeds of the robbery to her husband. It was argued in the confiscation proceedings that this could not come within the definition of a tainted gift because it was not made after the date on which the offence was committed. The Court of Appeal concluded that the literal meaning of the Act gave rise to absurd results on the basis that it appeared to provide a criminal with a day's grace to dispose of the proceeds of crime, and meant the treatment of a tainted gift would depend upon the time of day when an offence was committed. Macur LJ, giving the lead judgment in the Court of Appeal, adopted a purposive construction of this provision, reading it as though the date on which an offence was committed referred to the actual time of its commission, after which any tainted gift would fall for consideration for confiscation.”
[42]It would be anomalous, or absurd, to adopt an approach which delayed the obligation on the landlord of an HMO to obtain a licence or to take steps to ensure proper management arrangements and fire precautions were in place until a time after the tenancy had commenced and the tenant had gone into occupation. The precise timing of payment and commencement of occupation cannot have been intended to matter. Consideration of the language of section 263(3) alongside the purpose of the legislation therefore suggests that a strictly literal approach as advocated by Ms O’Brien will not do. I would have no difficulty in regarding a landlord as being a person managing and as capable of committing an offence on the day of the letting if, on that day, the tenant went into occupation on agreed terms which provide for the payment of rent, whether the first payment was made earlier or later than the commencement of occupation.[43]But what of an agent for the landlord? It was the receipt by the Company as agent for the landlords of a single instalment of rent on 12 October 2021 which the Council say made the Company a person managing the HMO on that day, notwithstanding that its only function in relation to the HMO had been to let the remaining room, a function which was complete when the letting was achieved.[44]The definition of person managing is intended to identify someone who undertakes management responsibilities and to make them subject to relevant statutory obligations. It is not a status or designation created for its own sake. The receipt of rent or other relevant payments is the hallmark of that status and it is understandable why it should be so. The receipt of rent is one of the fruits of property ownership to which obligations for the benefit of those paying the rent ought properly to attach. The receipt of rent is also a management function, and it is therefore an appropriate way of identifying those who should be made subject to statutory management responsibilities.[45]But can it have been intended that the receipt of a single instalment of rent by an agent who has no continuing management responsibilities should be enough to place the agent under the same statutory obligations as a landlord or a managing agent?[46]If a “let only” agent who receives a single instalment of rent on behalf of a landlord at the commencement of the letting is a person managing, they would commit a criminal offence if, for example, they failed to comply with regulation 3 of the Management Regulations by ensuring that their own name, address and telephone contact number were clearly displayed in a prominent location in the HMO. They would also be under duties imposed by the Management Regulations to ensure that the water supply, the common parts and the living accommodation in the HMO were all maintained in an appropriate condition and that arrangements were made for the disposal of refuse. It is the nature of property management that it is a continuing activity and the duties imposed by the Management Regulations are necessarily therefore continuing duties which are not to be performed on a single day.[47]Similarly, the obligations imposed by HMO licensing are continuing obligations. In one sense a licence is a snapshot, in that it provides confirmation that in the view of the authority the property meets the conditions in section 64(3) of the Act (which include that it is suitable for occupation by a maximum number of households). But a licence is more than a record of circumstances which existed on a particular day. It is a means of imposing the conditions described in section 67 of the Act; these include in every case the conditions in Schedule 4 of the Act, which concern the provision of gas safety certificates, the safety of appliances, and safety precautions such as smoke or carbon monoxide alarms. Once again, these are continuing management responsibilities which are required to be observed for so long as the licence is in force.[48]The fact that the purpose of the definition of person managing is to identify those who will be subject to continuing obligations, backed by criminal and civil sanctions, calls into question the intended breadth of the definition. Did Parliament mean to attribute that status to an agent with no involvement in management? I would suggest not.[49]My main reason is to do with the purpose of the definition, as I have described it, which is not served by including an agent who has nothing to do with continuing management. The imposition of the statutory obligations on such a person (in addition to the owner) would be redundant and might even be counterproductive. It would create ambiguity as it would be very difficult to know for how long the status would continue after the single transaction which created it. Would the letting agent remain a person managing, with all the relevant responsibilities, only for the period to which the payment was referable, or throughout the tenancy, or for some shorter or longer period? There is no obvious answer to that question, and Ms O’Brien was unable to suggest one. To extend the status of “person managing” to someone with no continuing involvement might also create confusion in the mind of tenants over who was managing the property, which regulation 3 of the Management Regulations is intended to avoid.[50]Secondly, simply as a matter of language, it would be surprising if the descriptor “person managing” was intended to apply to an agent who was not engaged to manage the property and who had no power to do so.[51]Thirdly, the relevant words of section 263(3) include within the definition an agent or trustee “where those rents or other payments are received through” them. The reference to “those rents” is to rents received by an owner or lessee from tenants or licensees in occupation. The rents received by the owner or lessee will typically be instalments received over an extended term, rather than a single payment. The reference to a situation “where those rents … are received” suggests a continuing state of affairs and is not apt to describe a single payment received by a letting agent at the commencement of the letting, even if it is a payment of rent. That payment is not received in the context of a continuing relationship between the agent and the tenant, or the agent and the landlord; it is a one off payment and unconnected with management.[52]A tantalising hint that the status of “person managing” may not be acquired by the receipt of a single payment can be found in Jacques v Liverpool City Council (1997) 29 H.L.R. 82. That was a decision of the High Court concerning the predecessor of section 263(3), section 398(6) of the Housing Act 1985, which defined “person managing” as follows: “Person managing”(a) means the person who, being an owner or lessee of the premises, receives, directly or through an agent or trustee, rents or other payments from persons who are tenants of parts of the premises, or who are lodgers, and(b) includes, where those rents or other payments are received through another person as agent or trustee, that other person; and for the purposes of the foregoing paragraphs, where rents or other payments are received by means of a payment made on behalf of any person, they shall be treated as rents or other payments received from that person.[53]It will be seen that paragraph (a) of the definition in the 1985 Act is the same as that in section 263(3)(a), with slightly different punctuation, while paragraph (b) includes the same wording concerning receipt through an agent or trustee.[54]Mr Jacques was prosecuted by his local housing authority for breach of the HMO Management Regulations then in force. He was found by the Magistrate to be the person responsible as agent of the landlord for the day to day management of an HMO which was let to tenants whose rent was all paid through Housing Benefit. He had originally collected rent directly from tenants in the HMO but had not done so for four years. He now collected Housing Benefit cheques from the tenants made payable to the landlord and he also emptied the gas and electricity coin meters. He appealed against his conviction by way of case stated to the Divisional Court.[55]It was conceded by the Council that the receipt of the cheques for Housing Benefit were not payments, whether by way of rents or otherwise, within section 398(6) of the 1985 Act because the cheques were made out to the landlord and all that the appellant did was to collect them and pay them in to the landlord’s bank. The Court (Saville LJ and McKinnon J) agreed that concession was correctly made.[56]Next, the Court agreed with Mr Jacques that no inference about his status as a person managing could be drawn from his receipt of rent and payments towards arrears of rent directly from tenants, because this had occurred three or four years before the date of the alleged offence.[57]Finally, the Court accepted the submission of the housing authority that the reference to “other payments” should not be understood as being limited to payments similar to, or in the nature of rent (such as a licence fee). “Other payments” should be understood in the context of the management of premises and, McKinnon J said:
“[O]ne has to look at the context in which the other payments are made and it seems to me right to limit the words “other payments” having regard to that context so as to make other payments referable to any sums of money other than rent payable in respect of the management of the premises which would be received by the landlord from the tenant in the ordinary course of the tenancy. Thus, “other payments” do include the collection of meter monies.”
[58]Saville LJ agreed but confined his answer to the critical question to the circumstances of the particular case before the Court (i.e. to a case in which payments were collected every week). He explained the need for that qualification in this way:
“I would rather like, subject to any submissions to the contrary, to have that qualification because I can conceive of a case where there is a complete one- off transaction, when one might be able to argue that this really was not intended to be comprehended by section 398. Unless either of you have any objection I think we can simply answer, “Yes, in the factual circumstances of this case”.”
[59]Three relevant points emerge from Jacques. The first is that there must be some temporal connection between the receipt of rent and the relevant offence. The defendant was not found to be a person managing because he had collected rent from tenants three or four years previously. The second is the importance of the statutory context in limiting a literal reading of the language, so as to confine “other payments” to payments of money related to the management of the property. Finally, there is Saville LJ’s reluctance to extend the meaning of “other payments” to cover “a complete one-off transaction”.[60]These points, and in particular the third (although it was not the basis of the decision), support the view I take that a payment made to an agent of the landlord whose only function is to let the property in question and who thereafter has no involvement in the continuing management, is not a payment within the scope of section 263(3). For that reason, the Company was not a person managing the HMO and Mr Cetin did not commit an offence when the Company received the payment of rent from Ms Weir-Clarke.

Disposal

[61]For these reasons I allow the appeal and set aside the financial penalty imposed on Mr Cetin by the Council. Martin Rodger KC, Deputy Chamber President 23 June 2025 Right of appeal Any party has a right of appeal to the Court of Appeal on any point of law arising from this decision. The right of appeal may be exercised only with permission. An application for permission to appeal to the Court of Appeal must be sent or delivered to the Tribunal so that it is received within 1 month after the date on which this decision is sent to the parties (unless an application for costs is made within 14 days of the decision being sent to the parties, in which case an application for permission to appeal must be made within 1 month of the date on which the Tribunal’s decision on costs is sent to the parties). An application for permission to appeal must identify the decision of the Tribunal to which it relates, identify the alleged error or errors of law in the decision, and state the result the party making the application is seeking. If the Tribunal refuses permission to appeal a further application may then be made to the Court of Appeal for permission.

Cited in 2 later judgments