An owner of a flat has been found liable for failing to have a selective licence, despite being unaware that he was required to do so.
A flat situated in the London Borough of Tower Hamlets was required to have a selective licence under Part 3 of the Housing Act 2004. Local Authorities have the power to introduce selective licensing schemes which requires all properties privately rented in a specified area (other than those required to be licensed as a HMO) to have a selective licence. There are often conditions attached to the granting of these licences with the intention of improving the quality of private rented properties in the area.
Failure to have a selective licence can result in enforcement action by the Local Authority, and private action by the tenants. The latter occurred in this case. The tenants of the flat applied to the First-tier Tribunal for a rent repayment order. The Tribunal have the power to order that the landlord repay a tenant a portion (or all) of the rent paid during the period in which they occupied the property without a licence.
In defence to the application for a rent repayment order, the landlord argued that he had a "reasonable excuse" on the basis that he was not aware he was required to have a licence. The First-tier Tribunal held that ignorance of the need to have a licence is not a "reasonable excuse", and that is "incumbent on landlords" to familiarise themselves with the relevant legal requirements. The First-tier Tribunal ordered the landlord to repay the tenant a sum in excess of £5,000.
The landlord appealed the decision to the Upper Tribunal, who ultimately agreed with the First-tier Tribunal that the landlord did not have a "reasonable excuse", and that the standard of assessing whether an excuse was reasonable was an objective one.
As evidenced by this case, it is vital that a landlord familiarises themselves with the legislation that they are required to comply with.
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