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TODAY'S OTHER NEWS

Revealed: Why council's lettings fine was slashed by £28,000

A compliance consultant has explained why a local council’s penalty on a rogue landlord - initially £31,499 - was slashed to just £3,300 by a tribunal.

In the First Tier Tribunal (Property Chamber) a buy to let landlord, Tan Sandhu, appealed against a financial penalty fine of £24,649 - which had initially been £31,499 - imposed by Coventry council for breaches of the Housing Act 2004.

The Tribunal decided the council was entitled only to £3,300 and now a compliance consultant - Phil Turley of Landlord Licensing and Defence - has dissected the case. 

Turtle says: “Whilst we cannot condone a landlord not knowing and/or failing to comply with the HMO Management Regulations, this case is a clear example of a Council mis-applying the legislation for their own purposes.

“Coventry City Council had originally tried to extract £31,499 from this landlord when in fact, as the Tribunal determined, they were only entitled to fine the landlord a total of £3,300. An attempted over-charge of £28,199.

“Whilst there is no actual proof of causality in this case, it is however interesting that whereas court fines go to central government, councils get to keep these landlord fines as an income stream which may affect their objectivity.”

The property, a semi-detached house in Walsall Street, Coventry came to the Council’s attention as part of a campaign of inspections to improve the quality of HMO housing around Warwick University.The Council found that the landlord of this particular property had failed to comply with the Management of Houses in Multiple Occupation (England) Regulations 2006 in four breaches:

- Failed Duty of Manager to provide information to occupier(s);

- Failed Duty of Manager to take safety measures;

- Failed Duty of Manager to supply and maintain gas and electricity;

- Failed Duty of Manager to maintain common parts, fixtures, fittings and appliances.

In particular, the Council’s inspector noted that keys were needed to exit individual rooms (risk to life in case of fire). Rear door was insecure (risk of entry by intruders). There was also no notice displayed giving name, address and telephone number of the manager as required by the Regulations.

On the fire safety front, the smoke/heat detector in the kitchen had been removed and no fire blanket had been provided.

After giving the landlord notice of the breaches in November 2018 the council re-inspected in March this year, and found several of the breaches had not yet been rectified.

The council decided to impose a penalty of £2,100 in relation to the missing manager’s details notice and £29.399 in relation to breaches under regulation 4 (duty to take safety measures) - a total of £31,499. 

After receiving ‘representations’ from the landlord, Coventry council reduced the total to £24,649.

The landlord agreed breaches had been committed but appealed that the penalty charges were excessive and not in line with the council’s own policies nor government guidelines; he also appealed that his financial circumstances had not been taken into account.

However, Turtle says the Tribunal was “scathing” about Coventry council’s financial penalty calculations and claims.

In relation to the Manager Details Notice for which the council fine was originally £2,100, the Tribunal found that a fair and reasonable amount taking into account the landlord’s financial circumstances, and that it was a ‘first offence’ should be £200 though the Tribunal then added 10 per cent to this because as an estate agent or mortgage broker, Sandhu should have been aware of the issues.

In relation to the safety issues the council’s starting fine had been £29,399 including various add-ons for the property being “above the Coventry average value”, and that the landlord’s breaches were “motivated by financial gain” both of which the Tribunal found to be untrue. 

The Tribunal stated that it was not persuaded by the council’s calculations and "neither is it persuaded that the amounts demanded are in any way reasonable or reflect the actual failures of the applicant (landlord).”

The Tribunal then proceeded to calculate that the ‘fair’ financial penalty for the safety related issues should be £5,000 less 50 per cent for a ‘first offence’ but then plus 10 per cent because the landlord’s profession.

“Landlords in receipt of ‘Notice to Impose Financial Penalty’ from councils would be well advised to take immediate professional advice to defend against these unwarranted council excesses and hold them to account” concludes Turtle.

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