The law on the amount tribunals will award in successful Rent Repayment Order proceedings has been developed over a number of decisions by the Upper Tribunal. In their latest decision of Acheampong v. Roman [2022] UKUT 239 (LC), the Upper Tribunal gave helpful guidance to all First-Tier Tribunals deciding on Rent Repayment Orders.
This case, as with several of the cases before the Upper Tribunal dealing with the amount of Rent Repayment Orders, was a combined appeal of several different First-Tier Tribunal Rent Repayment Order decisions. Also, as with other cases of this sort, it was determined “on the papers”, with the parties providing written submissions to an Upper Tribunal Judge to review rather than having a hearing in person. Unusually, neither of the landlords were represented, but all the tenants had secured representation from one of the groups who offer representation in return for a cut of the money received by successful tenants applying for a Rent Repayment Order.
In the case of Acheampong, the Upper Tribunal set out the history of the case law on Rent Repayment Orders. They started with Parker v. Waller, a case under the older legislation which is no longer relevant. Next, they looked at the effects of Vadamalayan v. Stewart and others [2020] UKUT 183 (LC), a very significant case under the new legislation which led the First-tier Tribunal to award 100% awards in most Rent Repayment Order cases over a year. This case was partially overturned by Williams v. Parmar [2021] UKUT 244 (LC), which held that tribunals had to consider a range of factors in determining the appropriate award and should not start with a presumption of a 100% Rent Repayment Order. In that case, a Rent Repayment Order of 100% was replaced with one of 80% – a 20% reduction and thousands of pounds saved for the landlord. Williams v. Parmar also restated the importance of considering all the factors in a case.
In Acheampong, the Upper Tribunal then gave some practical advice for tribunals deciding on the size of Rent Repayment Order to make. They set out a four-stage approach to guide First-tier Tribunals in their deliberations:
“….
- Ascertain the whole of the rent for the relevant period;
- Subtract any element of that sum that represents payment for utilities that only benefited the tenant, for example, gas, electricity and internet access. It is for the landlord to supply evidence of these, but if precise figures are not available, an experienced tribunal will be able to make an informed estimate.
- Consider how serious this offence was, both compared to other types of offence in respect of which a Rent Repayment Order may be made (and whose relative seriousness can be seen from the relevant maximum sentences on conviction) and compared to other examples of the same type of offence. What proportion of the rent (after deduction as above) is a fair reflection of the seriousness of this offence? That figure is then the starting point (in the sense that that term is used in criminal sentencing); it is the default penalty in the absence of any other factors, but it may be higher or lower in light of the final step:
- Consider whether any deduction from or addition to that figure should be made in the light of the other factors set out in section 44(4)….”
These four stages make some important points clear for landlords:
- A 100% award is now much less likely unless the case is very serious (perhaps a repeat offence or truly terrible conditions at the property).
- Having assessed the overall seriousness to find a starting point, the Tribunal will then have to move onto further consideration of the factors set out in the legislation before reaching the final award.
- Any services included in the rent can be deducted from the sum of any award.
- It will be important to provide evidence of these in any defence to a Rent Repayment Order claim (although, if these are not available, the Tribunal can and should be asked to come to its view of what these expenses would be).
The Upper Tribunal has set out this approach. First-Tier Tribunals making decisions on Rent Repayment Orders can be expected to adopt it. If they do not, their decision could be open to challenge, particularly if they miss out on consideration of factors suggested or adopt the old approach of using a “starting point” of 100%, regardless of seriousness.
Conduct of all kinds can be considered in determining seriousness, and the conduct of the landlord and the tenants are factors set out in the legislation. Good records of issues and clear witness statements will be crucial in seeking to achieve the maximum appropriate reduction in the amount of any Rent Repayment Order award.
Each of these points shows how important it is to prepare and present a response to a Rent Repayment Order claim clearly. Expert advice and assistance is the best way to achieve this. Of course, the Tribunal only has to consider how large a Rent Repayment Order is to make if it is satisfied that an offence has been committed and no defence applies. These are complex questions which are best addressed with professional legal help.
How can we help?
Expert advice is the best way to find out how much you might have to pay in a Rent Repayment Order case and to assist you in putting forward the best evidence you can to reduce that amount. Freemans Solicitors have significant experience and expertise in Rent Repayment Order advice, and our team will be happy to help with your enquiry.
Contact Michael Field, Karol Hart or Julian Hunt in our Crime Team on 020 7935 3522 or hmolawyers@freemanssolicitors.net . We can advise on investigations, diversion from prosecution, prosecutions of HMO Offences and ancillary matters such as Rent Repayment Orders.
Whatever your personal circumstances the above is only a guide and we would advise you to contact us to obtain definitive advice as you will appreciate that each person’s circumstances are unique to them.