Landlord prosecution casts spotlight on application of selective licensing to self-contained flats

Friday, November 18th, 2016 - Waltham Forest Council & Cornerstone Barristers

Following a trial at Thames Magistrates Court, a landlord has been ordered to pay a £12,000 fine as well as over £12,000 in court costs, after he was found guilty of not licensing three flats that he was renting privately in Waltham Forest.

Elston Tuitt, 62, of Watermint Quay, N16, was found guilty after being prosecuted by Waltham Forest Council for refusing to obtain licences for three rented flats in a mid-terraced house on Leyton Park Road, E10.

The three flats being rented out by Mr Tuitt were identified by officers during an action day in January 2016 and a court summons was subsequently issued for failure to licence.

At first Mr Tuitt entered an ‘abuse of process’ application against the Council’s decision to prosecute, which was rejected. The case was then heard at Thames Magistrates Court on Friday 11 November, where Mr Tuitt’s counsel argued that each flat should not have to be licensed separately, and only one licence should be required for the whole building. The Judge dismissed this argument and instead supported the Council’s requirement for all individual properties to be licensed.

The Judge ordered Mr Tuitt to pay a fine of £12,000 (£4,000 per offence) and full prosecution costs including the abuse of process application, totalling £12,652.93, plus a £120 victim surcharge. This brought the full financial penalty to £24,772.93.

Cllr Khevyn Limbajee, Cabinet Member for Housing, Waltham Forest Council said:

We are pleased that the Judge ruled in our favour and agreed that rented properties should be licensed separately. The majority of responsible landlords in the borough have responded well to the scheme, and we will continue to take action against anyone who thinks they can avoid obtaining a licence for their property.

The use of licensing is helping us to drive up standards in the private rented sector and reduce anti-social behaviour across the borough.

This is an interesting prosecution that explores the definition of a licensable property under Part 3 of the Housing Act 2004. Further details have been published by Cornerstone Barristers who represented the local authority.

Apparently, Mr Tuitt defended the proceedings arguing that, as a matter of law, section 85 of the 2004 Act did not require him to obtain a licence for each of the flats in the house, just one licence for the house itself. Thus, he contended, the information laid against him was bad in law.

District Judge McIvor held that each of the flats in the house was a ‘Part 3 house’ for the purposes of sections 85 and 99 of the Housing Act 2004; and that each required a licence.

The court held that Mr Tuitt’s application of section 99 of the 2004 Act, which defines the Part 3 house as ‘a building or part of a building consisting of one or more dwellings’, imperilled the policy objective of Part 3, which was to create sustainable communities by improving the condition and management of accommodation in the private rented sector.

In particular, as section 79 of the 2004 Act required the whole of the Part 3 house to be occupied under one or more tenancies or licences, none of which was exempt, the court considered that Mr Tuitt’s argument would have enabled the controller of a block of 10, 20 or 30 residential flats to avoid the need to license any of them, simply by leasing one to a registered provider of social housing for onward subletting, for example, or allowing it to lie vacant.

The counter-submission that the extent of the Part 3 house should, therefore, vary from time to time according to its occupied parts, thereby avoiding the section 79 limitation, created uncertainty and was unworkable.

While this first instance decision does not bind future courts, it certainly demonstrates the complexity of property licensing and it is likely to interest those practising in or affected by selective licensing schemes.

According to Cornerstone Barristers, it is expected that Mr Tuitt will now appeal to the High Court by way of case stated. Should that happen, London Property Licensing will watch the case with much interest.