Paper determination’ process is not a fair way to determine criminal guilt says Upper Tribunal

Thursday, February 25th, 2021 - By Robin Stewart, Solicitor, Anthony Gold

Robin Stewart, Solicitor, Anthony Gold

To make a rent repayment order or uphold a financial penalty on appeal, the First-tier Tribunal has to be satisfied beyond reasonable doubt that a criminal offence has been committed. Cases in the tribunal will not result in a criminal conviction, but a finding that a landlord or agent has committed a crime is still a serious matter.

In Raza v Bradford Metropolitan District Council [2021] UKUT 39 (LC) the Upper Tribunal considered whether it was fair for the First-tier Tribunal to have used its ‘paper determination’ procedure in three separate cases: two rent repayment orders and a ‘financial penalty’.

In each case the landlord or agent in question had consented to the case being decided without a hearing. Under the ‘paper determination’ process, each side prepares a bundle of evidence and legal submission, and the judge or panel reads the documents before making their decision. No-one attends a hearing (not even a virtual hearing) and witnesses do not have to answer any questions from the other party (called ‘cross examination’).

The three landlords had appealed to the Upper Tribunal, citing various reasons why they said the original decisions against them were wrong, but the Upper Tribunal granted permission to appeal only to consider whether it was fair for these cases to have been dealt without a hearing.

In each case there had been disputed matters of fact. In the financial penalty appeal, the landlord who was found guilty of a breach of the HMO management regulations blamed a tenant for the state of the property, and disputed the evidence of the respondent’s housing officer.

Both rent repayment orders were concerned with not holding an HMO licence. In one, the landlords claimed that they had applied for a licence as soon as the local authority told them they needed a licence, but were unable to complete their application because the website kept crashing. In the other case the landlord said that they had been advised by council officers that the building regulations certificate and safety certificates were all that was legally required.

The Upper Tribunal’s decision in Raza v Bradford

The Tribunal noted that unrepresented parties would generally struggle to identify what information was required to prove their case without having the opportunity to supplement their witness statements with oral questioning at a hearing. For this reason, even if both parties agreed to it, the Tribunal should come to an independent view on whether a paper determination was appropriate.

That principle applied even to civil law disputes, and the Tribunal noted that the distinctive features of these types of cases made an oral hearing necessary. Judge Cooke held that the procedure used in these cases was “unreliable” because the landlords were “at risk of being found to have committed a criminal offence, there were factual issues in dispute and the FTT made findings of fact on the basis of evidence that had not been tested in cross-examination.” Judge Cooke stated that the process was also unfair because the tribunal had made findings that the landlord had committed criminal offences without giving them the opportunity to cross-examine the witnesses who gave evidence against them, or to respond under cross-examination to the case made against them.

Judge Cooke said it was difficult to imagine cases where there was disagreement about the facts and the tribunal, confronted with different versions of events from the parties, could be so sure of contested facts that it could find them proved to beyond reasonable doubt on the basis of written evidence alone. And, even if such a case existed and the tribunal could be sure about the evidence and facts, not holding a hearing would nevertheless be unfair in a case where the party concerned was at risk of being found to have committed a criminal offence.

Implications of Raza v Bradford Metropolitan Council

This is significant decision from the Upper Tribunal. The immediate effect of this appeal it appears to be an end to the practice of the First-tier Tribunal using the paper determination for rent repayment order and financial penalty cases. Even if landlords would prefer to have the case decided without a hearing this will not be an option, except perhaps in cases where it the landlord accepts they are guilty of the offence, and the only question for the Tribunal to determine is the amount of any rent repayment order or penalty.

Judge Cooke’s decision also contains important comments about the rights of accused persons to challenge the evidence relied on against them. In the criminal courts it is difficult for a prosecutor to rely on hearsay evidence; there are many exceptions and nuances, but the general position is that witnesses must attend court to be available for cross examination by the Defendant. The tribunal is more flexible and does not have such strict rules of evidence, but the decision in Raza appears to assert a right for landlord and agents to cross examine their accusers. This is consistent in my view with the European Court of Human Rights’ analysis of Article 6 ¬ß 3 (d) of the Convention on Human Rights: that is, the right “to examine or have examined witnesses against him and to obtain the attendance and examination of witnesses on his behalf under the same conditions as witnesses against him”. Evidence should be from a witness in person, unless there is good reason for their attendance.

In Al-Khawaja and Tahery v. the United Kingdom the European Court of Human Rights confirmed that Article 6 ¬ß 3 does not create an inflexible rule that no prosecution based solely or decisively on the statement of an absent witness can be fair, but the Court did affirm that the normal position will be that subject to some exceptions, an accused person must be given the opportunity to challenge a witness against him through some form of cross examination. A prosecution based primarily on the evidence of a witness who does not attend will only be a fair one if “sufficient counterbalancing factors” are in place.

Article 6 ¬ß 3 only applies to person ‘charged with a criminal offence’, and in the past the Upper Tribunal has stressed that the tribunals exercise a civil jurisdiction, and the rules of criminal evidence and procedure do not apply. However, the categorisation as ‘civil’ or ‘criminal’ under domestic law is only one factor among many when the courts assesses whether the criminal limb of Article 6 applies, and whether the procedural safeguards which come with that are required.

The argument that financial penalties constitute a ‘criminal charge’ for the purpose of ECHR Article 6 is compelling, but rent repayment orders are perhaps more difficult to classify. However, in Raza the Upper Tribunal has indicated that strict standards of procedural fairness apply to both rent repayment orders and financial penalties, and a close reading of the Upper Tribunal’s decision contains at the very least hints of procedural rights beyond simply a requirement that an oral hearing be held before a landlord is found to have committed a criminal offence.

The author of this blog, Robin Stewart, is a Solicitor in the Housing team at Anthony Gold. His email is ros@anthonygold.co.uk.

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. This article does not represent legal advice and should not be treated as such.

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