A couple of Upper Tribunal decisions on rent repayment order appeals, with broader significance.

Ficcara & Ors v James (2021) UKUT 0038 (LC)

The applicant tenants had sought rent repayment orders for a) failure to licence, b) harassment under Protection from Eviction Act 177, and c) illegal eviction under the PfEA. They had sought RROs of 12 months rent in respect of each offence. The FTT was satisfied that three offences had been committed, but only made one RRO. The tenants appealed, assisted by Flat Justice.

The Upper Tribunal held that the wording of s.44 Housing Act 2016 precluded an award per offence:

Very clear guidance is provided by section 44 as to the amount which may be ordered to be repaid under a rent repayment order. Section 44(3) sets the limit. The amount a landlord may be required to repay in respect of a period must not exceed the rent paid in respect of that period less any relevant award of universal credit paid in respect of rent under the tenancy during that period. It is significant that the limit is expressed by reference to a period of time, and the rent paid in respect of that period of time, rather than by reference to a particular offence. If a number of offences are committed in the same period, the application of section 44(2) will result in a single period of time, rather than multiple periods of time each of the same duration and commencement. The amount which may be made the subject of a rent repayment order must relate to the rent paid by the tenant in respect of that period.

Further, although Flat Justice had not made the alternative argument that different periods beyond the 12 months could be considered where the dates of the offences allowed, this was also not clearly permitted by s.44 Housing Act 2016

Although their case was not developed in argument beyond the extreme position that each separate offence, whenever it was committed, should result in the repayment of a sum equal to 12 months’ rent, an intermediate argument is available to the appellants. That is that an order should be made in respect of the licensing offence for the period commencing on 15 March 2018, and in respect of the harassment and eviction offences for the period ending on 28 July 2019, resulting in aggregate in repayment of rent for the whole of the period of more than 16 months during which the appellant was landlord and was committing offences.

While I acknowledged that that is a possible construction of section 44, I do not believe it is what the section envisages. It is a general principle of law that a person should not be penalised except under clear law; that principle gives rise to a presumption of statutory interpretation sometimes referred to as the presumption against doubtful penalisation.

The appeal was dismissed, but the Upper Tribunal added further comment on the FTT’s discretion as to an amount of award that is clearly a sign post for the future. Addressing Vadamalayan v Stewart (2020) UKUT 183 (LC) (our note), the Deputy President of the Chamber said:

It has not been necessary or possible in this appeal to consider whether, in the absence of aggravating or mitigating factors, the direction in section 44(2) that the amount to be repaid must “relate” to the rent paid during the relevant period should be understood as meaning that the amount must “equate” to that rent. That issue must await a future appeal. Meanwhile Vadamalayan should not be treated as the last word on the exercise of discretion which section 44 clearly requires; neither party was represented in that case and the Tribunal’s main focus was on clearing away the redundant notion that the landlord’s profit represented a ceiling on the amount of the repayment.

It is clear that the full rent is the maximum that can be ordered to be repaid, but, absent a conviction and the application of section 46(1), the UT apparently does not think that setting the full rent as the ‘starting point’ is the correct application of the FTT’s discretion.

Raza v Bradford Metropolitan District Council (2021) UKUT 39 (LC)

Three joined appeals of RROs. In each case, the only ground of appeal considered was whether a hearing should have been held of the RRO applications, rather than a decision on the papers. (Even though the parties had either consented or not objected to determination on the papers without a hearing).

The Upper Tribunal noted that in each case there were disputed facts. This meant that the matters were not suited for determination on the papers, where there was no possibility of evidence being tested on cross examination. This was particularly a concern where the Tribunal was being asked to make findings to the criminal standard of proof that an offence had been committed. The procedure the FTT had adopted in each case was:

unfair because it resulted in a finding that a criminal offence had been committed without giving the landlord the opportunity to cross-examine the witnesses who gave evidence against him or to respond, under cross-examination, to the case against him.

All three appeals succeeded. Clearly, RROs with disputed facts should be dealt with by way of a hearing in the future.