Conviction for managing an unlicensed HMO quashed on appeal: an application must be decided before instigating a prosecution

Thursday, July 19th, 2018 - By Alice Richardson, Barrister at Trinity Chambers Newcastle-upon-Tyne and Arden Chambers, London

Alice Richardson, Barrister at Trinity Chambers Newcastle-upon-Tyne and Arden Chambers, London

Mirza (1) City Based Lettings Limited (2) v Newcastle City Council, Newcastle Crown Court, HHJ Gittins, on appeal from Newcastle Magistrates’ Court, 8 June 2018

The Appellants appealed against the decision of the District Judge finding them guilty of three offences under s.72(1) Housing Act 2004: having control of or managing an HMO which is required to be licensed Part 2 of the Act but is not so licensed.


Mr Mirza was long leaseholder of a property known as Summerhill House (“the Property”). City Based Lettings Limited were the managing agent.

The Property was itself an HMO and there was no dispute that it was required to be licensed and was not so licensed on 30 November 2016 (‘the relevant time’).

However, the Property was split into four ‘blocks’ internally and the local authority considered that three of the blocks were HMOs requiring their own licenses.

On 16 December 2016 an officer of the local authority contacted the appellants and advised that should an application be made, and a licence granted, it would be deemed to have been in place since June 2016 (and thus no offence would have been committed).

On 17 December 2016 Mr Mirza applied online for a licence for Summerhill House.

There was correspondence between the parties thereafter but Mr Mirza’s application was never granted or refused under the Act. Nevertheless, the local authority took the decision to prosecute and the first appearance at the Magistrates Court took placed in May 2017.

Relevant Law

Where application for a licence under Part 2 is made the authority must either (a) grant a licence or (b) refuse to grant a licence: s.64(1).

Schedule 5 of the Act sets out the procedure to be taken if a licence is granted or refused and includes, ultimately, the right to appeal to the First Tier Tribunal: s.71.

By s.72(4)(b) in proceedings against a person for an offence under s.72(1) it is a defence that, at the material time an application for a licence had been duly made in respect of the house under s.63 and that application was still effective (i.e. had not been determined).

The Appeal

On appeal the appellants argued firstly that they had a defence under s.72(4)(b) and/or the decision to prosecute had been an abuse of process and secondly, that they had a ‘reasonable excuse’ defence.

The local authority conceded that Summerhill House was itself an HMO and that there would be no regulatory benefit in requiring a separate application for each block. However it argued that it was nevertheless entitled to require each block to be licensed separately.

The parties had reached what the judge described as a “Mexican stand-off” with the local authority refusing to process Mr Miza’s application.

The appellant argued that it was not open to the local authority to require a separate application for each block. In any event, where an application had been made for a licence for the building as a whole it was not open to the local authority to find that the application was “not valid”.

The ‘promise’ made by the authority in the email of the 16th December 2016 was reasonably relied upon by the appellants when they made their application. The decision to initiate a prosecution when there was an outstanding application was an abuse of process.

The Judge considered that the local authority had initially acted reasonably in giving the appellant’s the opportunity to avoid a prosecution by allowing time to make an application. However, having done so, it was incumbent on the council to draw that to a close before initiating a prosecution. There was a live application that had not been properly dealt with and to embark in criminal proceedings, at that stage, was premature.

Having delivered that judgment the judge allowed a short adjournment after which the local authority conceded the appeal.


Where an application for a HMO licence is made the local authority must properly determine that application before initiating a prosecution.

It is entirely appropriate for the local authority, on receipt of an incomplete (or even wrong) application, to take steps to assist and encourage the applicant to provide further information and so on. However, should the applicant fail to do so the application must be formally refused before enforcement proceedings are taken.

The question of whether it was ever open to the local authority to seek multiple licenses did not need to be resolved in this case. Arguably in this circumstances of this case the local authority were not entitled to reach any such conclusion as it was accepted that there would have been no regulatory benefit in doing so. It may be that if any such determination is made under s.255 in future the issue will arise again.

The author of this blog is Alice Richardson, Barrister at Trinity Chambers, Newcastle-upon-Tyne (here) and Arden Chambers, London (here). Alice successfully represented Mr Mirza in the appeal.

Please note that the views and opinions expressed in these blogs are those of the author and do not necessarily represent the views of London Property Licensing. These blogs are designed to stimulate discussion and debate within the property industry.

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