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Rent Repayment Orders – just the immediate landlord


Rakusen v Jepsen & Ors (2023) UKSC 9

The issue for the Supreme Court was whether the wording of section 40 and 41 Housing and Planning Act 2016 meant that a rent repayment order could be made against only a tenant’s immediate landlord, or also against a superior landlord (where the occupying tenant’s landlord themselves had a tenancy of the property) where that landlord had also committed a relevant offence.

Section 40 provides

    1. Introduction and key definitions

(1) This Chapter confers power on the First-tier Tribunal to make a rent repayment order where a landlord has committed an offence to which this Chapter applies.

(2) A rent repayment order is an order requiring the landlord under a tenancy of housing in England to—

(a) repay an amount of rent paid by a tenant, or

(b) pay a local housing authority an amount in respect of a relevant award of universal credit paid (to any person) in respect of rent under the tenancy.”

The issue really turned on the meaning of ‘a landlord’. The Court of Appeal, overturning the Upper Tribunal (Lands Chamber) had found that as a matter of statutory interpretation, this was a reference to the landlord in the tenant’s tenancy, not any superior landlord. (Our note here).

Shortly, the Supreme Court agreed.

This straightforward interpretation links the landlord with the tenancy that generates the relevant rent. It renders it artificial and unnatural to construe the opening words of section 40(2) as referring to any landlord other than the landlord under the tenancy which generates the relevant rent, that is the rent to be repaid under section 40(2)(a) and the rent in respect of which the universal credit is paid under section 40(2)(b). It excludes a superior landlord because it is not the “landlord under” the tenancy which generates the rent.

The appeal was dismissed.


For transparency, I acted for an intervener, Safer Renting, whose concern was to set out the range of poor and illegal practices carried out in ‘rent to rent’ arrangements, or where a property owner sought to distance themselves from the handling of the property behind a company or companies, obfuscating who was responsible for management and who ultimately received the rent.

The Supreme Court decision does make rent repayment orders of little utility as a way to tackle rogue landlord, and the committing of relevant offences, in ‘rent to rent’ set-ups. This is despite such set-ups being more likely to commit such offences, either deliberately or through incompetence. A ‘rent to rent’ landlord facing rent repayment order applications will typically just disappear, or dissolve the company. Payment of RROs made against such set-ups is rare and impossible to enforce.

The Supreme Court acknowledges this, but considers it a matter for Parliament to address

we accept that the interpretation we take renders RROs less effective than they perhaps could be if they were to be made available against superior landlords. But in our view that development would undermine the clear definition of an RRO, as set out in section 40(2) of the 2016 Act, and would therefore require new legislation. In other words, if this is thought to be a problem any reform would be a matter for Parliament and cannot be achieved through a distorted interpretation of the relevant provisions in the 2016 Act.

Hopefully, this will happen, otherwise tenants of rent to rent setups, most likely to suffer problems at the hands of their landlords, will simply see the landlord escape without penalty (and frequently re-emerge in a very similar guise – see here for example).


Giles Peaker is a solicitor and partner in the Housing and Public Law team at Anthony Gold Solicitors in South London. You can find him on Linkedin and on Twitter. Known as NL round these parts.


    • Giles Peaker

      And had £295 in assets in December 2021.

      • John

        If only Hammersmith’s Trading Standards were as keen as Islington’s to look into companies that routinely issue “licences to occupy” to visitors from overseas that wouldn’t necessarily know their rights.

  1. Tim Melville-Walker

    Deeply frustrating but I fear SC are (of course) correct: I hope government listens and amends the law, but I fear that needs primary legislation…

  2. David

    This is an open invitation for rogue landlords and even lazy landlords to just form a company, then rent through that company and avoid HMO regulations. We all need to write to the Minister who at the time of writing is Rachel Maclean.

    I have come across two different “rent to rent” outfits, one is literally a bunch of heavies who padlock tenants into their room if rent is not paid on time, they evict others and get tenants from homeless shelters with no Tenancy Agreement or anything. They coach them through making a claim for benefits and over occupy to a factor of 12 in a space for 5. Leaking ceilings are not repaired and they demand access to rooms without notice.

    During their day job they work as construction workers and even have a limited company. The Landlords already had a bad history and this ruling just gives them a clean slate.

    The Minister of State for Housing and Planning is a mid-level position in the Department for Levelling Up, Housing and Communities in the British government. The position has been held by Rachel Maclean since the 2023 British cabinet reshuffle on 7 February 2023.

    • Tim

      I’m sorry, did you really say “padlock tenants into their room”? Have 999 ever been called about this?

  3. WasimAmar

    civil penalties are available against the superior landlord, these can be upto £30,000 so would be greater than the majority of RRO’s.. only thing is there is no compensation available for clients, then again the RRO itself was meant to be a penalty and not compensation anyway.. For the example you give why has the council not looked into this and give a penalty payment to the superior landlord, the situation you are describing would clearly lead to a maximum penalty.

    • Giles Peaker

      RROs are meant to be additional to civil penalties, and of course the tenants don’t receive anything from a civil penalty. Also, RRO offences include various offences for which there is no civil penalty.

      Additionally, it is not necessarily the case that the superior landlord would be automatically on the hook for a civil penalty for an offence by the intermediate landlord.

      In the example I linked to, the council pursued banning orders. But a phoenix company with a different sole director (but obviously connected) simply springs up. The same is true of civil penalties against these entities.

  4. Alan

    The biggest issue for all of these is that even if you win and get the order, there then follows the ordeal of trying to actually get the money.

  5. Ben Reeve Lewis

    @Alan The data we (Safer Renting) submitted to the SC from our data system, is that RRO awards we have obtained against an asset holder, result in a 40% collection rate without chasing but where the respondent is a rent to rent company with no assets we have recovered just 5% of all monies awarded. Meaning that pursuing a rent to rent scam company or individual is quite frankly a waste of time.

    In 2 applications against a well established management company in recent months who manage a number of properties we got £71,000 awarded. They didn’t pay so we froze their bank account and found just £1,300 in it. The property owner is BVI, the management company has a London office of dubious provenance and the MD is based in China.

    On average Safer Renting deals with 350 cases a year of harassment and illegal eviction. 25% of those cases involve insubstantial, asset-less intermediaries as the immediate landlord. It takes us around 25 hours work just to get the award, not counting chasing the money. Being a charity we do RROs for free but there also some excellent non profit services out there who charge a percentage. They would have the same problem as us, so RROs against these scammers aren’t practical for them either and not worth referring over. Result? Criminals walk, tenants denied justice.

    That’s the real world effect of the SC decision. Lets hope DLUHC takes the lead offered by the comments by the SC and re-visit the law.


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