A seasoned London landlord has been ordered to pay a £19,753 rent repayment order after failing to obtain a mandatory House in Multiple Occupation (HMO) licence for a property in Fordwych Road, London. The oversight, which lasted nearly three years, has resulted in significant financial penalties for City & Suburban Properties Ltd.
Landlord accepts responsibility but blames managing agent
City & Suburban Properties Ltd, a firm with a portfolio of 20 commercial and residential properties, was taken to the First Tier Property Tribunal by three tenants. The tribunal found that the company had no reasonable excuse for not licensing the flat as an HMO until February 2024, despite having licences for other properties in its portfolio.
Director Laurence Bellman, who has over 50 years of experience in the property sector, claimed that the firm had engaged Cedar Estates as professional agents to manage the property in 2021. Cedar Estates’ director, Darren Yanover, admitted to being aware of the additional HMO licensing schemes in London and took full responsibility for the error, offering his “sincere apologies” for not realising sooner that the property lacked the required licence.
Tribunal highlights landlord’s oversight
Despite the landlord’s lawyer arguing that the lapse was the agent’s fault and an act of inadvertence rather than deliberate neglect, the tribunal judge ruled otherwise. The judge emphasised, “A reasonable expectation of professional landlords and managing agents is that they should have systems in place for checking the regulatory requirements in respect of a property.”
The tribunal further noted that both the landlord and the managing agent were aware of the legal requirements for HMO licensing and their prolonged failure to ensure the property was licensed, even as new tenancies were agreed, amounted to “an act of recklessness.”
Tenants report disrepair issues
In addition to the licensing breach, tenants had reported ongoing issues with water leaks and mould in the property. Although Bellman argued that efforts were made to resolve the water leaks, the judge criticised both the landlord and the agent for not addressing the disrepair more swiftly, given their knowledge and resources.
As a result, the tribunal determined that 65% of the total rent paid by the tenants should be refunded, leading to the substantial rent repayment order.
