In clarifying what can be considered a “house” for the purpose of the selective licensing scheme under part 3 of the Housing Act 2004, the Upper Tribunal (Lands Chamber) in Northumberland Mews Ltd v Thanet District Council [2022] UKUT 179 (LC); [2022] PLSCS 115 has focused on the flexibility of the scheme.
Houses under part 3 are required to be licensed if the local housing authority (LHA) has designated the area as being subject to selective licensing, they are occupied and are not excluded by virtue of section 85(1). Section 99 defines a “house” as a building or part of a building consisting of one or more dwellings. A “dwelling” is also defined in that section as a building or part of a building occupied or intending to be occupied as a separate dwelling.
Many LHAs have considered the following types of residential accommodation to be a “part 3 house”: (a) a flat; (b) part of a building consisting of several flats; and (c) a building consisting of several flats. It has been the practice of LHAs to grant licences under part 3 to landlords relating to more than one flat and granting more than one licence to the same landlord in relation to different parts of the building. This practice was called into question by the appellant landlord in Northumberland Mews Ltd.
In 2020, Northumberland Mews Ltd (NM), the appellant landlord, acquired a mid-terraced period house situated in Margate, Kent. The house had been converted into 22 flats. Some of the flats were already tenanted, but NM also granted tenancies following its purchase of the building.
Between 2011 to April 2021, Thanet District Council, the respondent LHA, designated its area as being subject to selective licensing. NM failed to obtain a licence until April 2021. NM’s predecessor-in-title had previously licensed the building, but NM erroneously believed that licence was transferrable.
After an investigation, Thanet was satisfied beyond reasonable doubt that in respect of the five flats which it had gained access, NM had committed an offence under section 95(1) of managing a house which was required to be licensed under part 3, but was not so licensed. Pursuant to section 249A(1), Thanet levied five separate financial penalties on NM in the sum of £10,000 per flat. NM appealed, but the penalties were upheld by the First-tier Tribunal.
NM argued on appeal to the UT that Thanet was wrong to impose the separate financial penalties. Pursuant to section 91(1) a licence could not relate to more than one “part 3 house”. It asserted that the only “part 3 house” that was required to be licensed was the building. Each flat in the building did not constitute a separate “part 3 house”. In short, there had to be a correlation between the number of offences committed, the number of “part 3 houses” required to be licensed and the number of licences that could be issued.
In dismissing the appeal, the UT found that the essence of the scheme under part 3 was flexibility. The Act was not prescriptive in relation to whether a block of flats owned by a single freeholder must be subject to one licence or several. This permitted LHAs to adapt their approach depending on the circumstances. An LHA could choose to grant a single licence for a block or separate licences for individual flats or group of flats.
Section 91(1) only required the premises to which the licence related to be a single “part 3 house”. This could be a flat, or a number of flats comprising part of the building or the whole building. In the present case each of the flats was a “part 3 house”. Each required a licence. NM had committed the offence under section 95(1).
Elizabeth Dwomoh is a barrister at Lamb Chambers
